With the Senate debating the overhaul of the nation s financial regulatory system, President Obama is in New York City Thursday to confront Wall Street in a speech. His purpose: to outline the elements he wants in the legislation, from limits on the size of banks to more consumer protections.

Such broad topics of course are of interest to everyday consumers, as well as members of the investment community. But there are also smaller, specific provisions in the legislation that could impact individual investors. Among them: whether derivatives should be sold on a regulated exchange, corporate governance and regulation of various players in the financial industry.

Here, a look at why those topics are important:

Standards for Brokers

Currently, brokers and insurance agents are required to present clients with generally suitable advice based on the individual s financial situation and tolerance for risk. Within the universe of suitable products, however, they are free to steer customers to whatever options make the most money for them not the client. The House version of the financial reform package included language that would hold brokers to the same fiduciary duty standard that investment advisors must already meet.

Such protections are needed because mainstream investors, once they ve chosen who they re going to rely on for investment recommendations, basically do whatever they re told, says Barbara Roper, the director of investor protection at the Consumer Federation of America. Roper says that the current Senate version doesn t include the provision, but that amendments will likely be introduced to add the House language or otherwise change the relevant law. A spokesperson for the Securities Industry and Financial Markets Association, a trade organization for the brokerage industry, says the group supports a new fiduciary standard for both brokers and investment advisors because the current patchwork, status quo system doesn t do enough to protect investors.

Rules on Credit-Rating Agencies

The legislation coming before the Senate now takes important steps to reduce reliance on and increase oversight of credit-rating agencies, including making them liable if they fail to follow proper procedures, Roper says. The Council of Institutional Investors has also backed measures to give the SEC more resources to oversee rating agencies, and to change the rules that require some institutional investors to invest only in securities with specific credit ratings.

In theory, changing the rules on credit-rating agencies should have no effect on the performance of money-market funds, for example, says Mercer Bullard, a professor of securities law at the University of Mississippi and the president of Fund Democracy, a mutual fund shareholder advocacy group. [Fund managers] should always be conducting an independent evaluation of the risk characteristics of portfolio securities, Bullard says. Some, however, have argued that fund managers essentially use ratings as a substitute for doing their own research. An improvement in the reliability of credit ratings could somewhat enhance the stability of money-market funds, Bullard says. A spokesperson for the Investment Company Institute, a trade organization for mutual funds, says that credit-rating agencies simply provide a floor because money-market fund managers do their own independent credit assessments, and that the industry has been calling for credit-rating agency reform since 2005.

Proxy Voting

The current Senate bill also takes on corporate governance issues although it s likely that amendments will be introduced attempting to weaken pro-shareholder provisions, according to the Consumer Federation of America. Such provisions include requiring directors to win a majority of votes cast in uncontested elections for corporate boards, and a plurality in contested elections, and requiring that large, long-term investors be given proxy access, or the ability to promote their own candidates for a board on proxy materials distributed by the company.

Currently, it s cost-prohibitive for institutional investors to nominate their own candidates for the boards of large-cap companies, says Brandon Rees, the deputy director of the AFL-CIO s office of investment, which works with union-sponsored pension plans. These voting-related measures are the most important parts of the legislation for investors, says Amy Borrus, deputy director of the Council of Institutional Investors, an industry group, because it s all about board accountability. If directors know they might lose their board seats, they might do a better job of representing shareholder interest. The Business Roundtable has argued that shareholders need more and better information about activist investors efforts to influence companies actions.

Executive Compensation

The current Senate bill includes what s known as a say on pay provision that requires an annual shareholder vote on executive compensation. What does executive compensation have to do with financial regulatory reform? The recent financial crisis was a failure of corporate governance as well as a regulatory failure, and executive pay structures incentivize excessive risk-taking, the AFL-CIO s Rees says.

Shareholder votes on pay wouldn t be binding, but could essentially shame companies into more moderate pay policies, according to the Council of Institutional Investors. Clawback provisions should also be strengthened to ensure that executives aren t overcompensated for underperformance, Borrus says.

Preventing Accounting Fraud

The financial reform bill could end up weakening a central part of the Sarbanes-Oxley reforms enacted in the aftermath of the Enron scandal, according to the Consumer Federation of America. After some delays, SEC standards requiring an annual audit of publicly traded companies procedures to prevent accounting fraud are now to be applied to all companies, regardless of size. Amendments exempting companies with less than $75 million in market capitalization succeeded in the House and were unsuccessful in the Senate Banking Committee, but could be re-introduced on the Senate floor, Roper says.

If such amendments are adopted in the final reform bill, that would mean that in the legislation that s designed to respond to the current crisis, we have language that weakens the protections adopted in the wake of the last financial crisis, Roper says. This question isn t central to current reform efforts, but symbolically I think it s important because it suggests that no matter what we do in this legislation, it s at risk of being weakened once public attention turns elsewhere, Roper says. The Business Roundtable has argued that accounting standards shouldn t be set through legislation and the current Financial Accounting Standards Board process should be respected.