A new group formed to represent the investor perspective on possible regulatory reforms for the U.S. financial markets is to be headed by two former heads of the U.S. Securities and Exchange Commission, William Donaldson and Arthur Levitt Jr.

Donaldson and Levitt will lead the Investors’ Working Group, which is co-sponsored by the Council of Institutional Investors and the CFA Institute Centre for Financial Market Integrity. It will issue an initial report and recommendations by late spring.

The CFA Institute and the Council of Institutional Investors say they believe that the ongoing national discussion about regulatory reform has largely ignored investor considerations, focusing instead on containing costs for issuers and dealers in the U.S. capital markets.

“This group has been established to work with policymakers in efforts to restore public confidence by seeing to it that essential regulatory changes will include consideration of the primacy of investor interest,” said Levitt, who chaired the SEC from 1993−2001. “Our group will receive input from the broadest possible base in order to assure investors that transparency and comprehensible investor protections are the metrics by which we judge our markets. Our approach will be inclusive, balanced, and pragmatic.”

“Too often, the views of investors get short shrift in discussions about how to modernize our financial regulatory system,” said Donaldson, who led the SEC from 2003−05. “The Investors’ Working Group will serve as a critical sounding board for proposals to improve the framework for financial regulation in the wake of the crippling global credit crisis.”

Other members of the group include: Jeremy Grantham, co-founder and chair, GMO, LLC; Bill Hambrecht, founder, chair and CEO, WR Hambrecht + Company; Bill Miller, chair and chief investment officer, Legg Mason Capital Management, Inc.; and, Nell Minow, editor and co-founder, The Corporate Library; among others.