Required Disclosures/Proxy Advisory Services.

This bill requires proxy advisory firms in North Carolina to clearly disclose when their voting recommendations are not based on a written financial analysis of how the vote affects shareholder value. The law defines a "written financial analysis" as a document that evaluates both short-term and long-term financial impacts and explains the methods used to reach a conclusion. If a firm recommends against company management or uses default policies that oppose management without such an analysis, it must inform clients that the recommendation was not grounded in these financial evaluations. Additionally, the bill mandates that proxy advisors provide these disclosures to both shareholders and company directors to ensure transparency in the voting guidance process.