Good evening! It's great to see so many alumni and supporters of the SEC here tonight.
I always look forward to this dinner. In my time at the Commission, I worked with many of you in this room. This event is our best opportunity to re-connect and keep strong the bonds among the members of the SEC family. These gatherings always remind me of how much my Commission years meant to me, and how fortunate I was to have that opportunity.
Amy Goodman, ASECA's President, and Cecile Srodes, its Executive Director, have done a terrific job in putting this event together. Of course, tonight's dinner is especially important to me. I am greatly honored to receive the William O. Douglas award. It's a humbling experience, and one I will never forget.
Harvey Pitt, thank you for your generous introduction. After I learned that I would be receiving the Award, the second thing I thought — right after, "Wow, I guess I must be getting pretty old" — was, "Who should introduce me?"
Many names came to mind. In my sixteen years at the Commission, I had the pleasure of working with six Chairmen, another 17 Commissioners, five other General Counsels, and more Division Directors and Office Heads than I can remember. Many of them are here tonight. David Ruder, in particular, has had an indelible effect on my life. We went from being colleagues at the SEC during his chairmanship to being law partners at Baker & McKenzie. We have shared some unforgettable professional experiences. David's friendship is a treasured legacy of my SEC career.
But, the Douglas Award dinner brings back memories of my earliest SEC days. That led me inevitably to Harvey. Shortly after I joined the staff in 1974, Harvey became the Commission's General Counsel at the tender age of 30 — although from my perspective as a 28-year-old, new-to-the SEC staff attorney, fresh out of law school and a clerkship, he seemed, if not elderly, at least quite senior.
Working for Harvey was unforgettable.
Harvey is brilliant — we all know that. But he also inspired a sense of shared mission, public service, and camaraderie that made me look forward to going to work. Harvey, although there are a few days that I would probably prefer not to repeat, working with you were some of the best years of my career. You are a dear friend and one of the all-time greats.
There are many other people in the room that have made extraordinary contributions to the SEC, and I won't try to name them all. I do, however, especially want to acknowledge the current Commissioners in the audience — Chairman Schapiro, and Commissioners Walter, Aguilar, Paredes, and Gallagher. Elisse Walter and I go way back. When I became General Counsel in 1983, she was already a mainstay of the Office. Elisse, what would I have done without you? And, when I left in 1990, Mary Schapiro was on her first tour of duty as a Commissioner. We are all fortunate that she returned for a second. Without Mary's leadership during the past three years, the Commission's 75th anniversary might well have been its last.
I want to acknowledge my family here tonight. My wife, Angela, is herself an SEC alum, and enjoys these dinners as much as I do. Our daughter, Mary, is here — both she and her sister Christina were born while their mother was at the SEC. They are, I suspect, rather baffled about why anyone would give their father an award.
I said that this dinner brings back memories of my earliest days at the Commission. In the mid-1970s, I had the pleasure of working with some of the legends who built the modern SEC, including individuals like Irv Pollack and Stan Sporkin, both of whom are here, and men like Ray Garrett, Al Sommer, and Phil Loomis, who are no longer with us. To me, the real purpose of the Douglas Award is to remind us all of the tradition of integrity and devotion to the public good exemplified by William O. Douglas and by the outstanding individuals, such as Irv and Stan, who followed him.
My advice to the younger Commission staff — and I guess at this point in my life that means almost everyone on the staff — is to take some time to learn about the men and women who came before you and the challenges they faced. It will put today's issues in perspective. Go back and read the speeches of Commissioners from past decades; familiarize yourself with how and why the securities laws evolved as they have over the years and with the tensions and controversy that accompanied change. The SEC of today stands on the shoulders of the people who shaped those decisions.
I don't at all mean to imply that the agency's best years are in the past. When you join the SEC, you quickly start picking up bits and pieces of its culture. Here's one of the first I noticed: Everyone who ever worked at the Commission views their years on the staff as the agency's "golden era". To hear anyone who came before you tell it, in their day, the challenges were greater, the successes shone brighter, the staff and Commissioners were united as one, and the Chairman was a modern-day incarnation of King Solomon. Take this kind of reminiscing with a grain of salt. Somehow, along the way, we tend to forget the setbacks, frustrations, public criticism, and mistakes that we were all party to.
The truth is that the Commission's challenges have become far more daunting over the years, but the Commission and its staff continue to respond with the same imagination, integrity, enthusiasm, and commitment to the agency's mission. Certainly, the Commission today has some formidable tasks on its plate. For example —
· Implementing Dodd-Frank, which expands the Commission's mandate and requires it to grapple with areas ranging from conflict minerals to proprietary trading.
· Satisfying skeptical judges who have their own views of what makes for an effective enforcement program.
· Maintaining the integrity of the U.S. securities markets at a time when they are capital-raising vehicles for companies that operate in parts of the world with business cultures, legal and accounting institutions, and disclosure traditions far different than our own.
· Responding to judicial and legislative pressure to justify regulatory decisions, not just by their impact on investor protection, but with a mathematical comparison of difficult-to-measure benefits and uncertain costs.
All of this arises in an era of constrained budgets and unprecedented public cynicism about government and government service.
But, while the responsibilities have become more complex, the markets more global, and the environment more contentious, the SEC is still able to draw on things that made it great — a deeply ingrained culture of investor protection, dedicated leadership, and a commitment to excellence.
I know first-hand that the dedication and commitment of the Commission and its staff today are undiminished. In 2002, I was lucky enough to rejoin the SEC family — although as something of an in-law, rather than a full-fledged member. For the past nine-plus years, I have had the privilege of serving as a Board Member of the Public Company Accounting Oversight Board. We are under the SEC's oversight and work hand-in-hand with the Commission to further the interests of the investing public in fair and accurate audited financial reporting.
At a time when confidence in auditing was severely shaken, the first Board members were, I believe, able to tap into the same sense of mission and excitement that the early Commissioners must have felt in the wake of the 1929 crash. But the PCAOB had an advantage that the founders of the SEC did not: The example and support of the SEC itself. In fact, one of the things we have tried to instill at the PCAOB is the same culture of single-minded focus on the best interests of investors and the same pride in excellence through open and robust debate that have been hallmarks of the Commission.
I will be leaving the Board next week. However, I know that both its commitment and the Commission's to investor protection and full disclosure are strong — just as when I arrived at the SEC in 1974.
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One thing I have learned by attending these dinners over the years is that most of the audience is more interested in catching up with old friends than in listening to speeches.
I will close by simply saying how grateful I am to receive this award. The William O. Douglas Award is not really about an individual — it is about the Commission itself. So, I accept, not as personal recognition, but as recognition of the traditions and values of the Commission and of the key role it has played in our economy over the past 78 years — and that it continues to play today.
Thank you all for being here and good night.