Today, Congresswoman Maxine Waters (D-CA), Ranking Member on the House Financial Services Committee, issued the following statement commending S&P Dow Jones Indices and its Index Committee for declining to weaken the eligibility rules for the S&P 500, S&P mid-cap 400, and S&P small-cap 600, the benchmarks underpinning the retirement savings of tens of millions of American workers and retirees.

“I commend S&P Dow Jones Indices and its Index Committee for refusing to participate in a race to the bottom. This was the right call. The standards they upheld for inclusion in the indices—that a company be profitable, maintain a real public float, and trade long enough for the market to honestly assess it value—are not bureaucratic technicalities. They are the guardrails that make an index fund a safe place for a teacher’s pension or a worker’s 401(k). S&P chose the integrity of its benchmarks over the short-term demands of a handful of soon-to-be-public companies and their bankers. That is what a gold-standard index provider does.
 
I am calling on Nasdaq, LSEG and all others to reconsider their efforts to relax their eligibility standards for large, newly public, or unprofitable companies, and to reaffirm that the largest companies, like SpaceX, do not get to buy their way into America’s benchmarks on accommodating terms. Brokers, too, must reassess the concessions they have granted these mega-caps, especially the lowered investment thresholds that facilitate the push of untested and unprofitable securities onto the market.

I want to also extend my appreciation to investor and consumer advocates who mobilized and reminded everyone that index providers occupy a position of extraordinary public trust. And that violating that trust is unacceptable.”

###