Board of Directors Application and Selection Process

MSRB will accept applications for its Board of Directors from January 6, 2025, through February 14, 2025.
Please read the press release for additional information.

The MSRB solicits applications from qualified candidates to serve on its Board of Directors. The MSRB Board of Directors includes eight members who are representative of the public and seven members who are representatives of MSRB-regulated broker-dealers, banks and municipal advisors. All Board members must be knowledgeable about the municipal market. Any interested individual with knowledge of the municipal securities market may apply to serve on the Board. Rule A-3, “Board Membership: Composition, Elections, Removal, Compensation,” discusses the nomination and election process, including provisions about eligibility and membership requirements. Board members receive an annual stipend of $65,000 for their service.

Each year the Board of Directors’ Nominating Committee publicly announces the solicitation of applicants for vacant positions on the Board that begin for the upcoming fiscal year that starts on October 1. 

The application form is available for preview, but must be completed through the online application portal during the submission period.

Once applications are submitted, MSRB staff conducts an initial review to confirm each applicant’s category as a public or regulated representative and ensure that all necessary information has been provided in the application. Read the FAQs below for additional information on Board membership categories and eligibility.

The Board’s Nominating Committee then reviews all applications and selects candidates for interviews. Additional documentation, including the Board Member Candidate Questionnaire and consent to a background check are required for applicants who are interviewed. After completion of the interview process, the Nominating Committee nominates selected candidates to the full Board of Directors for election and the nominating process is concluded by September 30. Upon completion of the process, the new Board members are publicly announced, and the names of all applicants are published on the MSRB’s website.

If you have questions about MSRB Board membership or the nominating process, you may contact MSRB staff at BoardApplication@msrb.org or 202-838-1341.
 

FAQs on MSRB Board Membership Categories and Eligibility
 

The MSRB was created by Congress in 1975, through amendments to the Securities Exchange Act of 1934 ("Exchange Act"). Congress set several specific requirements for the structure and composition of the MSRB Board of Directors—requirements that were substantially revised by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Board membership categories required by the Exchange Act and MSRB Rule A-3 ensure representation of the diverse perspectives of the many constituencies with an interest in the MSRB’s mission and decisions. These include investors and municipal securities issuers, which the MSRB is mandated to protect; dealers in municipal securities and municipal advisors, over which the MSRB has regulatory authority; and members of the public with knowledge of or experience in the municipal industry.

Under the Exchange Act and MSRB rules, the Board consists of 15 members who all are required to be “knowledgeable of matters related to the municipal securities market.” The Board has two broad categories of members: “public representatives” and “regulated representatives.” A majority of the Board must be “public representatives.” Eight of the Board members are public representatives, required to be “independent of any municipal securities broker, municipal securities dealer, or municipal advisor.” Further, overall public membership must include at least one person who is representative of institutional or retail investors, at least one person representative of municipal entities, and at least one member of the public with knowledge of or experience in the municipal industry.

View an infographic on the selection criteria and steps in the process.

Seven Board members will be regulated representatives, meaning they are associated with a dealer or municipal advisor. Further, overall regulated membership must include at least one person associated with a dealer that is not a bank (i.e., a broker dealer), at least one person associated with a dealer that is a bank, and at least two associated with non-dealer municipal advisors (i.e., municipal advisors that are not associated with a broker, dealer or municipal securities dealer).

The categories and sub-categories of Board members are:

A public representative must be independent of any municipal securities broker, municipal securities dealer, or municipal advisor. The Exchange Act requires the MSRB to set requirements by rule regarding the independence of its public representatives. Accordingly, MSRB Rule A-3 defines independent to mean that the individual has “no material business relationship” with any MSRB-regulated entities. MSRB Rule A-3 and Board policy further provide that, to have “no material business relationship”, at a minimum, the person:

• is not associated, and has not been associated within the last five years as of the start of the Board term, with a regulated entity;
• and does not have a relationship with any regulated entity, whether compensatory or otherwise, that reasonably could affect the person’s independent judgment or decision making.

In the past, potential candidates have been ineligible because their employer (such as an investment adviser) had an affiliated broker-dealer that transacts in municipal securities and is therefore an MSRB-regulated entity. This has occurred with many potential candidates who held portfolio management or research roles at “buy-side” firms. Potential candidates similarly have been ineligible where, for example, their employer had a subsidiary company that was a regulated entity.

To be a public representative, even for a person who is not “associated with” a dealer or municipal advisor, the person must not have a business relationship, compensatory or otherwise, with a regulated entity that could reasonably affect or be perceived to affect the person’s independence of judgment or decision making. For example, in the past, some attorneys who applied to be public members on the Board were disqualified because of their, or their law firm’s, client relationships with regulated entities. Similarly, persons who applied to be public members representative of institutional investors have at times been disqualified because of the extent of their or their employer’s business relationships with MSRB-regulated dealers. This can occur, for example, in the case of separately managed account arrangements.

The standard to be “associated with” an entity under the Exchange Act is generally expansive in scope. It typically covers most employees of the entity in question, but the standard goes beyond that typical situation. Under the Exchange Act and MSRB Rule A-3, a person also is associated with an entity if the person controls the entity, is controlled by the entity, or the person and the entity are subject to common control. This makes it essential, in analyzing eligibility to be a public MSRB Board member, to consider not only the nature of a potential candidate’s employer, but also all its parent, subsidiary and other affiliated companies.

MSRB Rule A-3 requires the Board to include at least two municipal advisor members that are not “associated with a broker, dealer or municipal securities dealer.” As described above, the standard to be “associated with” an entity is generally expansive in scope. This makes it essential, in analyzing eligibility to be non-dealer municipal advisor representative, to consider not only the nature of a potential candidate’s employer, but also all its parent, subsidiary and other affiliated companies.

For purposes of Board membership, any individual employed by a bank, a bank holding company, or any department, division, subsidiary or affiliate (including a broker-dealer affiliate) of a bank or a bank holding company will be identified as a bank representative on the Board. Accordingly, a broker-dealer representative is an individual associated with a broker-dealer that is not an affiliate of a bank or a bank holding company.

The Board convenes in person at least quarterly at the MSRB's offices and also schedules additional meetings (virtually) in between quarterly meetings. Attendance at these meetings is required. Each member of the Board also serves on one or more standing committees, with assignments determined each fiscal year, which convene virtually periodically and may conduct in-person meetings as necessary throughout the year. Attendance at these meetings is also required. Meeting materials are generally provided for all Board and committee meetings in advance and Board members are required to review the materials in preparation for the meetings. 

The term of service for Board members begins October 1 of the calendar year in which the member is elected and concludes on September 30 of the fourth year of service.

The Board’s Nominating Committee each year faces the challenging task of finding individuals to complement the skill sets of the continuing Board members and comply with the detailed requirements of the Exchange Act and MSRB Rule A-3. While seeking the best-possible candidates, the Committee strives to balance considerations such as the size, type and geographical location of the employers and organizations represented by candidates, experiences and skill sets of candidates and the likely needs of the Board in the coming years. It is not uncommon for individuals to be eminently qualified but not selected due to the Board's needs for a particular year, and some Board members have applied more than once before being selected. Interested persons are encouraged to apply again in the future if not selected.