As a retail investor, whether you own shares directly, contribute to an IRA or a 401(k), there are many ways for you to voice your vote during annual meetings. Retail shareholders own 30% of the total shares of a publicly traded company and a majority of those shares go unrepresented.
If you own shares directly, you’ll likely receive a large packet in the mail a few weeks prior to the company’s annual shareholder meeting. This packet contains all the information you need regarding what’s on the agenda and your ballot. Unfortunately, most of these packets go directly into the trash. Getting familiar with these documents and what’s on the ballot is the first step in becoming an informed investor and voter.
Did you already trash your ballot? Don’t fret – you can find any company’s proxy statement online and you can also cast your vote by phone or online. The proxy statement provides an agenda and detailed description of each shareholder proposal. Each shareholder proposal will at least have the company’s recommendation on voting for or against and sometimes will provide a detailed description as to why they are giving that recommendation. After you’ve reviewed each proposal and its opposition (if applicable), simply follow the instructions on the ballot or call in your vote.
In addition to voting directly, you can also tell your financial advisor or mutual fund manager how to vote your shares (and why). If you have a financial manager who buys and sells shares for you, let them know how you want them to cast your vote. If your financial advisor does not follow your instructions on how to vote, then it’s probably time to find someone who will!
If your shares in a company are held in a mutual fund, technically you don’t own shares in the corporation, but you do own shares in the mutual fund that does. Mutual fund managers often don’t vote, but if they do, they typically vote based on the company’s Board of Directors recommendations. If you want to influence how they vote, you can write to them directly or reach out to the investor relations department.
This might all seem like a bit of a burden to take on, but not being an informed investor and participating in this annual vote could be detrimental to their share value and the company’s long-term success. Over the past decade, costs to consumers have increased and returns for shareholders have decreased because of the proposal resolutions voted on in annual meetings. If you want to be more involved or express concerns, call the company, call your asset manager or call your 401(k) fund.