Vote Your Proxy

By Jack Ehnes
Chief Executive Officer

Whether you are an individual investor with a handful of shares or an institutional investor with millions at stake, voting your proxy is a powerful tool you can use to influence corporate governance and social and environmental policies at the companies in your portfolio.

And in this age of the Internet, when you can discreetly buy and sell stocks online, all it takes is a few mouse clicks through the proxy process to be a shareholder activist.

What is proxy voting? Owning stock in a company gives you the right to vote on important matters concerning corporate policies and governance, including the election of directors who sit on the company's board. A U.S. public company is required by law to send shareholders a proxy statement and proxy card, or ballot, before holding its annual meeting. The proxy statement discusses the company's management, operations and financial performance along with descriptions of proposals on which shareholders can vote. While shareholders can vote in person at annual meetings, most vote by marking and signing the proxy card and returning it by mail or electronically via a proxy voting service.

Social and environmental issues are popping up on proxy ballots with increasing frequency, livening up the once-staid proxy season by spotlighting labor practices and climate change risk. These proposals deserve the attention of shareholders large and small. Their growing popularity has been fueled in part by former Vice-President Al Gore's 2006 Academy Award-winning hit documentary, An Inconvenient Truth, which elevated global warming as a national issue.

So how can ordinary shareholders use the proxy process to make their votes count at corporations? It's easy. You can do your own due diligence at home on your computer. Companies now routinely post their proxy statements online, either on their Web sites or on proxy-dedicated Web sites hosted by the companies or a proxy voting agent. The companies will provide you with a “Notice Regarding the Availability of Proxy Materials” and detailed instructions on how to cast votes electronically.

You will be directed to a Web site where complete meeting materials and instructions on how to use the voting platform are available. Your confidentiality will be preserved with a control or identification number that you will use only to vote proxies or provide proxy voting instructions.

In the time it takes to program your TiVo, you can weigh in on critical corporate issues that can affect your investment portfolio. We usually associate voting with the political world, but voting your proxy is a key legal right in business that deserves the attention of all investors.

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