This article is part of an ongoing series about the Shareholder Bill of Rights currently in Congress. Together, we can ensure that this bill truly represents our interests as shareholders and individual investors.

The Shareholder Bill of Rights is just an 11-page document, written in the quirky wide-margin, double-spaced format that all laws favor, perhaps to increase the page count so it looks like lawmakers are getting more work done (a favorite trick for those writing last-minute term papers, too).

There are plenty of details to be worked out if this becomes law. Who will work out many of those details? The U.S. Securities and Exchange Commission (SEC).

If the Shareholder Bill of Rights gets enacted, the SEC will have one year to clarify the rules about the issuance of proxies and the establishment of risk committees and decide which companies might be exempted.

That may not fill you with confidence. The SEC's reputation has been tarnished since the beginning of the "Great Recession," starting with the agency's failure to notice Bernie Madoff's Ponzi scheme, and continuing right up to last month's rebuke from Judge Jed Rakoff, who rejected the agency's settlement with Bank of America (NYSE:BAC) because, in his words, it "does not comport with the most elementary notions of justice and morality."

The current situation
Not that the SEC doesn't have enough on its plate already. The agency is wrestling with derivatives regulation, high-frequency trading, flash orders, hedge fund disclosure, increased oversight of credit ratings agencies, requiring brokers to act as fiduciaries, an AIG (NYSE:AIG) derivatives probe, and prosecution of Countrywide Financial co-founder Angelo Mozilo, among many other projects (including more run-of-the-mill options backdating probes, such as the ones we've seen in recent years at Apple (NASDAQ:AAPL), Take-Two (NASDAQ:TTWO), and IBM (NYSE:IBM)).

But the SEC has already begun grappling with some provisions of the Shareholder Bill of Rights. Last May, the agency voted to propose rule amendments that would make it easier for shareholders to nominate directors to corporate boards. Under the proposed rules, shareholders would be eligible to have their nominees added to the proxy materials if:

  • They own at least 1% of the voting securities of a company worth $700 million. 
  • They own at least 3% of the voting securities of a company worth between $75 million and $700 million.
  • They own at least 5% of the voting securities of a company worth less than $75 million.

Shareholders must have held the shares for at least a year, and can band together to aggregate their holdings.

This has a good deal in common with the provisions in the Shareholder Bill of Rights that deal with board elections. Thus, the SEC already has a leg up on the implementation of that aspect of the bill, and it is also familiar with many of its other features.

Lots of work ahead
By living in the Washington, D.C., area and attending far too many financial conferences, I've had the opportunity to meet several current and former employees of the SEC. I also gave a speech at the agency's main headquarters last September. My experience is that these folks are smart, well-qualified, and well-meaning. While a draft proposal went out yesterday that would beef up SEC resources, for now the organization is understaffed, and -- like all agencies -- subject to the whims of political pressures. And it has plenty of other issues to confront.

So is the SEC up to the task? Do you have a better idea for making Wall Street more shareholder-friendly? We want the Shareholder Bill of Rights to come from all of us. So post your comments at the bottom of this article (or any other in this series). Cast your vote in our online polls. Or send us an email at ShareholderRights@fool.com. Let’s all tell Wall Street and Washington what rights we shareholders really need.

Once you’re done, remember to check out "It's Time for a Shareholder Revolution" for more on the Shareholder Bill of Rights.