Provides for the regulation of proxy advisors (EG INCREASE GF EX See Note)

House Bill 830 enacts Chapter 54 of Title 51 of the Louisiana Revised Statutes, titled the Proxy Advisor Transparency Act, creating three new sections establishing regulations for proxy advisors operating within Louisiana. The statute defines proxy advisors as persons who provide compensation-based advisory services regarding shareholder votes, whether such services involve direct voting recommendations, proxy statement analysis, or development of voting policies. The core mechanism requires proxy advisors making recommendations against company management to make specific disclosures depending on whether those recommendations rest on written financial analysis. When recommendations against management lack written financial analysis, proxy advisors must disclose this fact clearly to service recipients, provide the same disclosure to affected company boards for certain service types, and publicly display a statement on their website home page indicating they provide non-analyzed recommendations. Conversely, when recommendations against management are based on written financial analysis meeting statutory criteria, proxy advisors must disclose this foundation to service recipients, make the analysis available upon request, and provide it directly to company boards for certain service types.

The statute affects three primary constituencies. Proxy advisory firms that provide services related to Louisiana-headquartered or incorporated companies, or services to any person in Louisiana, must comply with the disclosure requirements or face enforcement actions. Companies headquartered or incorporated in Louisiana that are subjects of proxy advisory services gain the right to receive disclosures from proxy advisors and may bring legal actions as aggrieved parties. Shareholders, unitholders, limited partners, and other equity owners of Louisiana companies can challenge proxy advisor violations through private rights of action and may intervene as aggrieved parties. The statute's practical effect requires proxy advisors to alter their service delivery practices by integrating mandated disclosures into their standard communications and potentially revising their website presentations.

The statute operates within Louisiana's existing Unfair Trade Practices and Consumer Protection Law framework, specifically R.S. 51:1401 et seq., by establishing proxy advisor compliance as an unfair and deceptive trade practice enforceable under that statute's investigative and remedial provisions. The statute grants the Louisiana Attorney General authority to investigate suspected violations using powers available under the Consumer Protection Law while also creating a separate private right of action for aggrieved parties seeking declaratory or injunctive relief. The definition of written financial analysis incorporates financial methodologies requiring analysis of short-term and long-term benefits and costs, conclusions regarding shareholder value impact, and transparency about analytical methods and personnel qualifications. The statute applies prospectively from January 1, 2027 forward and establishes standing for recipients of proxy advisory services, affected companies, and equity owners of those companies to initiate civil actions, with mandatory notice to the Attorney General within seven days of filing.