BILL NUMBER: AJR 79	CHAPTERED
	BILL TEXT

	RESOLUTION CHAPTER  92
	FILED WITH SECRETARY OF STATE  JUNE 10, 2004
	ADOPTED IN SENATE  JUNE 7, 2004
	ADOPTED IN ASSEMBLY  MAY 20, 2004
	AMENDED IN ASSEMBLY  MAY 20, 2004

INTRODUCED BY   Assembly Member Chu
   (Coauthors:  Assembly Members Aghazarian, Berg, Bermudez, Bogh,
Calderon, Canciamilla, Chan, Chavez, Cohn, Corbett, Correa, Daucher,
Diaz, Dutra, Dutton, Dymally, Firebaugh, Frommer, Garcia, Goldberg,
Hancock, Harman, Jerome Horton, Shirley Horton, Houston, Jackson,
Kehoe, Koretz, Laird, Leno, Leslie, Levine, Lieber, Liu, Longville,
Lowenthal, Maldonado, Matthews, Montanez, Mullin, Nakano, Nation,
Negrete McLeod, Nunez, Oropeza, Parra, Pavley, Plescia, Reyes,
Ridley-Thomas, Salinas, Samuelian, Simitian, Spitzer, Steinberg,
Vargas, Wesson, Wiggins, Wolk, Wyland, and Yee)

                        APRIL 12, 2004

   Assembly Joint Resolution No. 79--Relative to corporate elections.


	LEGISLATIVE COUNSEL'S DIGEST


   AJR 79, Chu.  Corporate elections.
   This measure would urge the United States Securities and Exchange
Commission to implement its proposed shareholder participation rules
in order to answer the call for badly needed reform, to improve
corporate accountability, to restore investor confidence, and to
provide shareholders with increased access to proxy to promote
greater board oversight of corporate operations and responsiveness to
shareholder concerns.




   WHEREAS, The California Legislature has noted with growing concern
the accounting scandals of major corporations including Enron,
WorldCom, and HealthSouth, and their sustained negative effect on
institutional and individual investors and on California's economy;
and
   WHEREAS, The cumulative effect of these instances of fraud and
wrongdoing has been to inflict avoidable investor losses totaling in
the billions of dollars and to significantly damage investor
confidence in California and elsewhere; and
   WHEREAS, These events have pointed to an urgent need for greater
corporate accountability, and specifically for corporate boards to
engage in greater oversight over corporate operations, thereby
fulfilling their traditional role as independent fiduciaries rather
than passive arms of management; and
   WHEREAS, One clear vehicle to achieving greater accountability on
the part of corporate boards is to increase shareholder access to
proxy, defined as the ability of shareholders to nominate a candidate
or slate of candidates for election to the board at annual company
meetings held for that purpose; and
   WHEREAS, Federal law controls many aspects of corporate election
procedures, and under current federal law and United States
Securities and Exchange Commission rules, shareholder access to proxy
is not required; and
   WHEREAS, The United States Securities and Exchange Commission has
been working for several months on proposed reforms to address this
dual crisis of corporate accountability and investor confidence,
addressing it in part by devising a means of providing within the
framework of the rules of the United States Securities and Exchange
Commission a mechanism for greater shareholder access to proxy and
has proposed a rule to improve the ability of shareholders to
participate in the nomination and election of directors of corporate
boards; now, therefore, be it
   Resolved by the Assembly and Senate of the State of California,
jointly,  That the Legislature hereby urges the United States
Securities and Exchange Commission to implement the proposed
shareholder participation rules at the earliest possible date in
order to answer the call for badly needed reform, to improve
corporate accountability, to restore investor confidence, and to
provide shareholders with increased access to proxy to promote
greater board oversight of corporate operations and responsiveness to
shareholder concerns; and be it further
   Resolved, That the Chief Clerk of the Assembly transmit copies of
this resolution to the President and Vice President of the United
States, to the Speaker of the House of Representatives, to the
Majority Leader of the Senate, and to each Senator and Representative
from California in the Congress of the United States.