What Is A Shareholder Proxy And Why It Matters

Shareholders can own part of a company through shares, which means they have a say in what happens. However, it is usually difficult to near-impossible for them to get to the ballot place and cast their vote. Many times, the company will send you a shareholder proxy ballot, which allows you to vote and not be at the annual meeting. Most people who own stock in companies believe it isn’t important to participate in corporate governance. You may not think you own enough or just don’t think your voice matters, but adding it to all other shareholders can get the attention you want and influence some of the decisions.

What Is It And Why You Vote It?

It is a requirement that the company hosts an annual meeting for shareholders. Before the meeting, packets are sent out that contains all the information and a proxy statement. This statement includes what topics will be covered, which includes board of director nominations and pay packages for the top executives. There may also be management proposals and more.

When you receive it, you, the shareholder, fill out the ballot and send it back. In some cases, you may also be allowed to vote online or by phone.

Some issues are advisory, which means there is nothing legally binding that states the company must make changes. However, some are binding and will require the corporation to make those changes that were voted for in the ballots.

You vote the shareholder proxy to be part of the process. If you and a handful of other shareholders get together on one particular issue and vote a certain way, you may raise eyebrows and get the situation noticed by others. They may, in turn, vote for you and your initiative, ensuring that change is made when it is necessary and good. For more information visit Colonial Stock Transfer Company.

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