Proxy voting sites make shareholder activism easier

By Michael Kramer

Two emerging proxy voting websites are having an impact on shareholder activism, causing companies to take notice. This year marks the first proxy season that both ProxyDemocracy. org and MoxyVote.com are up and running. These websites aim to increase participation in the proxy voting process, particularly among retail investors, and early results show at least some success. While most retail investors don’t vote their proxy, if they begin to show a willingness to do so, activists and management will be clamoring for their votes.

ProxyDemocracy.org, which went live in mid-2008, follows the proxy voting records of ten public and union pension funds and socially responsible mutual funds prior to companies’ annual meetings. The purpose is to allow individual investors to see how funds are voting on certain issues to help them make educated decisions in their own proxy voting.

MoxyVote.com, launched last November, also publishes the voting records of institutional investors and other special interest groups before annual meetings. More transformationally, Moxy Vote allows investors to cast their proxy votes on its website.

As an example of its impact, Moxy Vote ‘s website processed more than 22 million shares, or about 12% of On2’s outstanding shares, against On2’s proposed acquisition by Google. This prompted Google to raise its share price from 60 cents to 75 cents, leading to approval of the deal.

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Michael Kramer

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