UK/EUROPE - Cross-border proxy voting systems inhibit pension fund investors from voting their shares and need urgent reform, a new report claims.
The International Corporate Governance Network (ICGN) says there is no reliable system to verify receipt and tabulation of shareholders’ voting instructions.
The ICGN includes the world’s largest pension scheme the California Public Employees Retirement System, the UK’s British Telecommunications’ pension fund and Europe’s largest, ABP.
Its report – Cross Border Proxy Voting – also points out there is no agreement on how a global system of disclosure and voting would be regulated and who would foot the bill.
ICGN cross-border voting practices committee chairman John Wilcox said: “I urge companies, regulators, stock exchanges, intermediaries and service providers to coordinate their efforts to develop timely and efficient procedures, to upgrade disclosure documents and to facilitate share voting.”
One corporate governance adviser to a large UK pension scheme – who declined to be named – said: “The global system does appear to be rather cumbersome at the moment, without electronic voting being adopted in all countries.
“It makes it very bureaucratic.”
Manifest managing director Sarah Wilson agreed with the report’s findings.
She said: “These are property rights that people have and they are effectively being restricted from exercising them, so it is totally undemocratic.”
European Commission member Frits Bolkestein is examining the issue and will address the ICGN conference in July.
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