Shareholder Rights

Probably the most important ShareSoc campaign is the Shareholder Rights campaign, launched in October 2014 to get full rights to ALL shareholders.

Individual shareholder rights have been eroded, particularly by the nominee account process and the way that platforms, registrars and brokers fail to provide a good service to individual investors. Often, individual investors do not get informed when a general meeting is going to happen, and do not receive circulars, voting forms and annual reports. And many platforms make it difficult and expensive for investors to get this information.

Help may be at hand from the EU in the form of the Shareholder Rights Directive. SRD II has a clear intent that the end investor should be identified on the company register, including their email address, and should be entitled to receive company information and annual reports. See https://ec.europa.eu/info/law/better-regulation/initiatives/ares-2018-1944240_en for details.

UK law is at odds with the EU Directive. UK law defines a shareholder as the nominee and not the end investor (e.g. the individual investor like you or me). The UK law must be changed.

However, to date, the UK Government has been resistant to changing the UK legislation so as to meet the intent of the EU Directive.

We now have a once in a decade opportunity to get this problem resolved. We must not let the opportunity slip. We will be working with UKSA (and others) to make sure that BEIS and the Government make the right decision.

As a first step we have written to BEIS: click here for a copy of our joint letter from UKSA and ShareSoc to BEIS about SRD II.

Our second step is to ask members to write to their MP requesting that Government implement the Shareholder Rights Directive’s clear intent that the end investor should be identified on the company register. You can find details of your MP’s name and email address at this webpage http://www.parliament.uk/mps-lords-and-offices/mps/

The suggested wording of a letter/email to your MP is as follows:

“Dear ….,

Please can you ask Greg Clark, the Secretary of State for Business, Energy and Industrial Strategy to implement the Shareholder Rights Directive’s clear intent that the end investor should be identified on the company register, including their email address, and should be entitled to receive company information and annual reports. See https://ec.europa.eu/info/law/better-regulation/initiatives/ares-2018-1944240_en for details.

The UK law is at odds with the EU Directive. UK law defines a shareholder as the nominee and not the end investor (e.g. the individual investor like you or me). The UK law must be changed.

However, to date, the UK Government and BEIS has been resistant to changing the UK legislation so as to meet the intent of the EU Directive.

We now have a once in a decade opportunity to get this problem resolved. We must not let the opportunity slip.

Your help in making this happen is most appreciated.

Yours sincerely,”

 

Cliff Weight