Shareholder rights and in particular their erosion due to the nominee system are a big problem and one that both the UK Shareholders Association and ShareSoc campaign on (see our Shareholder Rights Campaign). It is hugely disappointing that HM Government has put this on the back burner due to prioritising Brexit and the Great Repeal Act.
I would like to draw your attention to this article https://moneyweek.com/small-investors-voting-rights/ which includes comment from both the UK Shareholders Association and ShareSoc.
My own comment in particular, which made me chuckle when I read it. Occasionally it is nice to inject humour into a serious subject!
A nation of absentee landlords?
When asked how many investors make use of their shareholder rights, Cox says: “We average about two people wanting to attend per AGM and much fewer who just vote, a couple of hundred a year (compared with nearly a million clients).” In terms of corporate actions, he says, it depends on the specifics – but we’re still talking anything from a few hundred responses to “just a couple”. So you can see why brokers might feel that this is not a pressing issue.
However, Cliff Weight, director at small-investor group ShareSoc, counters that the voting system provided by brokers is hardly likely to encourage activity. “If this was Gmail, voting would be easy and user-friendly with simple clicks and lots of icons – but currently their voting systems are not fit for the 21st century.” He considers the times that he has voted through his investment platform: “Whenever I’m voting online, it’s difficult and time-consuming. There are 20 or more resolutions, and no guidance or support. By the time I’ve finished clicking all the boxes, my shoulder hurts.”
Can sharesoc please campaign for an update to LSE (and ideally also AIM) rules, to require companies to enable online attendance at AGMs and EGMs?
As a shareholder living several hours from London, it’s not practical for me to attend meetings there in person, unless they happen to coincide with a visit to southeast England. I’m sure that applies to vast numbers of shareholders.
Yet I do regularly attend meetings in distant places – from Silicon Valley to Australia – via my broadband connection. It’s not hard to set up, and would certainly help enfranchise shareholders.