A Quick Look At Retail Investor Loyalty Programs – And Other Incentives To Get Out The Retail Vote

In the last few weeks of 2021 we had inquiries from three readers on this subject - one of our favorite ones - so we placed calls to a few colleagues who’ve had success here, and reviewed some of our own past articles for other ideas:

Peggy Foran, who pioneered the program of “tree-plantings or totes for votes” at Prudential many years ago promptly wrote back…”Bags and trees still on and have been a hit!”  

Our friends at Bank of America are still very satisfied with the charitable donations of $1 for every retail account that votes a proxy and will continue again this year (no charity determined yet.) They also mentioned a very interesting thing - that with their continuing share-buyback programs, the retail base is actually increasing noticeably as a factor in their Meeting quorum - something all companies with buyback programs need to be alert to this year.

IBM has also been very satisfied with its similar program - $1 to a designated charity per retail position voted - and they noted yet another important factor to pay attention to - a big surge in the numbers of their retail investor accounts, where there have been over 22 million first-time retail investors added to the ‘pool’ (on a nationwide basis) over the past 18 months or so. Many of these newcomers LOVE brand-name companies…but are new and naive re: proxy voting, and need some education - and some encouragement!

We have been telling one mega-cap company that asked about voting incentives that we’d bet $1000 they can raise their Quorum at the shareholder meeting by 4-5 percentage points if they can motivate their non-voting retail owners… and with “mostly company-friendly votes” so we are hoping they will give it a try this season. (This is a company that has had a lot of “squeakers” on shareholder proposals over the years…but, ouch - in the end, a tight-budget nixed the idea for this year.)

Here’s a link to the BofA success story, from 2018 (The Biggest And Best Thing We Saw This Season: A 41% Increase In Retail Investor Voting Participation…following An 8% Increase Last Year… At Bank Of America) and a link to a 2011 article that still has good ideas for incentivizing retail investors to vote proxies - and warnings about major turnoffs (A Short-List Of Incentives That Might Get More Folks To Vote Their Proxies)

Some of the very best tips for winning-over the big and fast growing “new investor” vote, please note, can be found in this very issue - and they revolve around using modern technologies - and also, more compellingly written and ‘engaging materials’ to truly “engage” - and convince - and motivate shareholders - and to make it fast - and easy for retail investor voters to cast their votes.