Ann Yeager, executive director of the
Council of Institutional Investors.
The Council of Institutional Investors has asked the
Securities and Exchange Commission to intervene after the main company
that provides real-time tabulations on shareholder votes stopped giving this
information to the groups that sponsor proposals.
The running tallies on shareholder votes are
generally kept under lock and key. Only a handful of parties, notably the
companies who are the subject of the proposal and the sponsor of the
proposal, get to see them. Most firms facing shareholder proposals use a
company named Broadridge to distribute investor information and provide
information on how shareholders are voting.
Last Friday though, at the behest of Wall Street’s
main industry lobbying group, the Securities Industry and Financial Markets
Association, Broadridge stopped giving shareholder sponsors access to
real-time updates. The move drew fire from some investors who say knowing
the current tally of votes helps both sides devise their campaigns. For
instance, if one side is losing, it might send out an extra mailing or make
Ann Yerger, executive director of the Council of
Institutional Investors, which represents corporate, public and union
employee benefit plans, said that Broadridge’s decision “raises deeply
troubling questions about the fairness and impartiality of the proxy
The decision by Broadridge to shut off real-time
vote access to sponsors of shareholder proposals comes in the middle of one
of the most closely watched investor votes in years — over whether to
separate the roles of chairman and chief executive at
JPMorgan Chase. While the vote is nonbinding, if could strip
Jamie Dimon, the bank’s chief, of the chairman’s title.
Lyell Dampeer, a Broadridge executive, confirmed in
an interview this week that he changed his firm’s policy after a call from
Sifma. Broadridge is paid by the brokerage firms so he said he was
“contractually obligated” to comply with the request. He did not return a
call for comment for this article.
The Council of Institutional Investors said while it
realized the S.E.C. had “limited authority” over firms like Broadridge, the
agency has expressed interest in making sure the proxy system as a whole is
fair and look at whether
regulatory reform is necessary.
This Forum program is open, free of charge,
to anyone concerned with investor interests in the
development of marketplace standards for expanded access to
information for securities valuation and shareholder voting
decisions. As stated
in the posted
Conditions of Participation, the
Forum's purpose is to provide decision-makers with access to
information and a free exchange of views on the issues
presented in the program's Forum
participant is expected to make independent use of
information obtained through the Forum, subject to the
privacy rights of other participants. It is a Forum
rule that participants will not be identified or quoted
without their explicit permission.
This Forum program was initiated to address
issues and objectives defined by participants in the 2010 "E-Meetings"
program relevant to broad public interests in marketplace
practices, rather than investor decisions relating to only a
single company. The Forum may therefore invite program
support of several companies that can provide both expertise
and examples of leadership relating to the issues being
The information provided to
Forum participants is intended for their private reference,
and permission has not been granted for the republishing of
any copyrighted material. The material presented on this web
site is the responsibility of
Gary Lutin, as chairman of the Shareholder Forum.
is a trademark owned by The Shareholder Forum, Inc., for the
programs conducted since 1999 to support investor access to
decision-making information. It should be noted that we have
no responsibility for the services that Broadridge Financial
Solutions, Inc., introduced for review in the Forum's
2010 "E-Meetings" program and has since been offering
with the “Shareholder Forum” name, and we have asked
Broadridge to use a different name that does not suggest our
support or endorsement.