Opening Statement at Open Meeting

Chairman Jay Clayton

June 28, 2018

Good morning.  This is an open meeting of the U.S. Securities and Exchange Commission, under the Government in the Sunshine Act.  Today we have five items on the agenda.  Each of these items is emblematic of the agency's commitment to review, improve, and modernize our rules for the benefit of our markets and our long-term Main Street investors.

• First, we will consider adopting amendments to the definition of "smaller reporting company," which was established in 2008.  Much has changed since then. 
• Second, we will consider adopting amendments to require the use of Inline XBRL in certain filings, which were proposed in 2017.  Machine-readable data and dissemination of that data have become a reality, and our rules should foster broad investor access to these techniques.    
• Third, we will consider a proposal to permit certain exchange-traded funds (or "ETFs") to operate without first obtaining a fund-specific exemptive order from the Commission.  This process has not changed since the first ETF was approved in 1992.  There are now over 1,900 ETFs. 
• Fourth, we will consider adopting amendments related to disclosures of liquidity risk management for open-end funds.  This is a new required disclosure that should improve investor understanding of a key aspect of effective portfolio management.      
• Finally, we will consider a proposal to amend rules that govern the Commission's whistleblower program.  It has been seven years since these rules were adopted and, since that time, Commission whistleblowers have provided original information that has led to enforcement actions in which the Commission has obtained over $1.4 billion in financial remedies.  Today's proposal is based on the office's experience with this very successful program.

The sixth item that appeared on the Sunshine Act notice – an updated regulatory coordination memorandum of understanding with the CFTC – has been removed from the agenda because it was voted upon by seriatim.

Before we go to the first item, I want to make a few observations about the agenda as a whole.  Over the past year, I have been increasingly impressed by the breadth of expertise at the SEC – kudos to the staff – and the diversity of topics the Commission is considering today is proof of that.  Commission staff is actively working on issues that touch all corners of the securities marketplace, including, importantly, our Main Street investors.  I am pleased that the meeting today shows measurable progress on many Commission initiatives, especially since some of the issues have been the subject of discussion for quite some time.  There is more to come.[1]

The recommendations today reflect tremendous work by the SEC's staff, and in my remarks I will identify by name many of the agency's dedicated public servants.  But an agenda this full uniquely affects my fellow Commissioners – and their staff – who have been working on all of the items simultaneously, and with other competing demands on their time.  I am particularly appreciative of their, and their staff's, efforts.  And I want to specifically acknowledge and thank Commissioner Piwowar in what is likely to be his last open meeting.  Today's rulemakings are only a small fraction of those he has worked on over his five year term.  Commissioner Piwowar has been tireless in his pursuit of the Commission's mission, and in his support of the staff — particularly his fellow economists in DERA.  He will certainly be missed.