DALLAS, May 28, 2026 — In an op-ed published in Fortune today, Texas Stock Exchange Chairman and CEO James H Lee announced the filing of a proposed rule amendment with the U.S. Securities and Exchange Commission that, if approved, would require member broker-dealers to vote uninstructed retail shares in proportion to the instructions they receive from participating shareholders.
The rule change is a first for a U.S. exchange, and is intended to address the impact of limited retail participation — as little as 28% annually — on shareholder vote outcomes. The foreign-owned proxy advisor duopoly has long relied on this participation gap and acquiescence of the legacy exchanges to defeat proposals supported by participating shareholders. TXSE's proposal builds on the approach ExxonMobil used to mobilize its retail shareholders and overcome proxy advisor opposition to moving its corporate domicile to Texas.
Excerpts from the op-ed are below:
"Most Americans hold shares in 'street name' through firms such as Schwab, Fidelity or Robinhood. When investors give voting instructions, their shares are voted accordingly. When they do not, legacy exchange rules increasingly leave those shares unvoted on substantive matters, as fewer proposals are now treated as routine.
"Broker non-votes and absent shares can create quorum risk, raise approval thresholds and function as practical opposition. Proposals fail not because shareholders opposed them, but because too many never responded. That is governance by friction …
"Not every public company has the will or resources to do what Exxon did, and companies breaking the proxy firms' grip one at a time, however laudable, will only get the market so far. Exchanges can address the same problem at the level of market structure, which is where it actually sits. At the Texas Stock Exchange, we are proposing what would be the first exchange-level reform of its kind to begin doing just that, subject to SEC review.
"The approach is straightforward: brokers should vote uninstructed retail shares in proportion to the instructions they receive from shareholders who do participate. If 60%of voting shareholders support a proposal and 40% oppose it, uninstructed shares would follow the same distribution. This is not broker discretion. It is math. It does not take away anyone's vote, and it does not entrench management. It restores a basic principle: participation confers influence; silence should not distort the outcome …
"The stakes extend beyond proxy mechanics. Governance friction is one reason being public has become more unpredictable, expensive and legally treacherous, helping push the number of U.S. public companies down sharply — from roughly 8,000 in the late 1990s to approximately 4,300 today — over the past generation while private markets have expanded. The answer is not to abandon public markets; it is to make them work again …
"Exxon's shareholders showed what is possible when retail's voice is restored and the proxy firms are held in check. Exchanges can provide that relief at scale, making where companies choose to list all the more consequential. On this and other areas of issuer alignment, the Texas Stock Exchange is leading the way."
Read the full op-ed here. View TXSE’s fact sheet here and the full SEC filing here.
About the Texas Stock Exchange
Texas Stock Exchange LLC, a wholly owned subsidiary of TXSE Group, is a fully integrated, electronic, national securities exchange headquartered and incorporated in Texas. Backed by many of the largest financial institutions and liquidity providers in the world, TXSE is purpose-built to bring real competition to corporate listings and expand access to America's public markets. With issuer alignment and transparency at its core, TXSE serves as a global listing and trading venue for both public companies and the growing universe of exchange-traded products. For more information, visit us at www.txse.com, on LinkedIn, or on X.