A service launched this month promises to reveal to users exactly how institutions vote at shareholder meetings and let them determine what investors might want.
The initiative, Proxy Insight, was first announced by the firm’s managing director, Nick Dawson, in August 2013. It allows users to search and sort an expansive database of 18 mn shareholder votes covering more than 20,000 issuers around the globe, stretching back to January 2012. Each investor’s voting history can then be examined and sorted by resolution type.
At an aggregate level, clients can see which investors are most likely to veto management proposals. Dawson explains that, surprisingly, a number of investors routinely counter almost half of any proposed resolutions.
The company has also created more than 200 profiles of top investors’ corporate governance policies based on their voting preferences, with remuneration still proving to be one of the more troublesome subjects for investors.
‘Complicated remuneration plans and boilerplate disclosures are universally disliked and there is often a sense that plans are too short term in nature,’ notes Dawson, adding that Proxy Insight’s data suggests there is an ‘emerging trend for longer-term thinking’ around the topic.
Dawson suggests that Proxy Insight serves to dispel a number of myths surrounding shareholder resolutions and voting – especially the influence of proxy advisers.
‘Yes, most institutions use one or more [proxy advisers], but in most cases this is to help them through either research or recommendations based on that institution’s policies,’ he explains. ‘Very few significant investors simply vote according to the recommendations and policies of a particular proxy agency; the real determinant of most voting decisions lies with the individual policies created by each asset manager.’
Such trends will serve to shape future applications for the platform, Dawson adds, though feedback for Proxy Insight has been largely positive so far. One notable use to date has been activist investors using the voting data to determine the potential level of opposition at previous shareholder meetings, and thus estimate the support they might be able to garner.
This emerging use ranks among the ‘ever-growing list of developments’ that Proxy Insight’s team intends to pursue. ‘Our focus for now is to ensure the platform caters to as many of [our customers’] requirements as possible, while remaining really easy to use,’ Dawson concludes.
