Joint UKSA-ShareSoc Letter in the FT re Unilever Vote and UK Shareholder Disenfranchisement


The letter, headed Complacency on Unilever vote may rebound on UK, said


Neil Collins highlighted the importance of small investors in Unilever’s coming votes (Inside London, FT Weekend, September 22-23).

A scheme of arrangement requires approval by at least 75 per cent in value of each class of the members or creditors who vote on the scheme, being also at least a majority in number of each class.

The court’s permission is needed to convene the meetings of members and creditors to vote on the scheme and at this point the court will review whether any division of the members and creditors into classes for voting purposes is appropriate.

However, the UK government’s complacent attitude to individual investors who hold their shares via nominee accounts may disenfranchise individual investors who mostly hold an interest in shares — they are not, under UK law, shareholders in the company.

We have urged the government to implement the very clear objective, of the EU Shareholder Rights Directive, that the end investor should be on the shareholder register as well as the nominee. So far they have stonewalled. Now the politicians’ complacency will come back to bite them, if UK individual investors’ ownership of Unilever is ignored.

Cliff Weight, ShareSoc

Peter Parry, UK Shareholders’ Association


The Neil Collins article referred to can be accessed at if you subscribe to

The Unilever case is proving a fertile ground for us to push our shareholder rights campaign, including the need for the end investor to have their name on the shareholder register.

The key issue with schemes of arrangement like this one is that as the nominee is the only shareholder, all the beneficial owners represented by the nominee will simply count as one shareholder in aggregate when it comes to deciding whether a majority of shareholders are in favour. That defeats the intent of not only the Shareholder Rights Directive but also the UK Companies Act, where a majority by number was required in order to prevent a small number of large shareholders riding roughshod over the wishes of a majority of smaller shareholders.


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