Investors should have greater power to nominate and elect corporate directors says a report published by the Securities and Exchange Commission.

The report, which was prepared by the SEC’s Division of Corporation Finance, notes the need to improve the existing proxy process and recommends action in two areas: improved disclosure and improved shareholder access to the director nomination process.

The report recommends more robust disclosure of the nominating committee processes of public companies, including the consideration of candidates recommended by shareholders.

As well, it recommends specific disclosure of the processes by which shareholders may communicate with the directors of the companies in which they invest.

The report also recommends that major, long-term shareholders be provided access to company proxy materials to nominate directors.

“An effective proxy process has never been more important to restoring investor confidence,” said SEC chairman William Donaldson in a statement. “We have worked and continue to work with the markets to put in place listing standards and rules that increase both the role of independent directors and the voice of shareholders. The next step is to assure that the proxy process reinforces these important advances,” he added.

Donaldson said that he has asked SEC staff to prepare rule proposals that would effect each of the recommendations in the report. He added that he hopes that the commission will be able to consider proposals as early as August, with regard to the disclosure recommendations; and, as early as September with regard to the proxy access recommendation.