By John P. Dunn, Vice President Corporate Issuer Sales
Richard Barron, a New Jersey advertising executive, recently attended his first annual shareholder meeting…while sitting in an airport. “I was able to attend virtually, thanks to WiFi” he explains, “and I was even able to ask questions and vote my shares.”
This year, a record 300,000 shareholders have participated in the corporate governance process through not only laptop and desktop computers, but iPads, smart phones and other mobile devices. Approximately 30% of them voted for the first time. Clearly, the era of handheld technology and social media has arrived – not only for individuals, but for corporate issuers seeking to expand their shareholder communications efforts.
“Forward thinking companies have been using social media sites like Facebook, Twitter and Linkedin® to increase brand awareness and improve customer service,” says Mike Mostransky, Broadridge’s Senior Product and Community Manager. “Recently, however, investor relations professionals have begun to realize that the combination of mobile technology and social media enables them to reach shareholders through a channel where many of them want to be reached. Market researchers forecast that by 2015, more people will access the Internet by mobile devices than by PCs, and we believe this trend will also lead to increased mobile participation by shareholders.”
The Social Media Explosion
When the state of Delaware changed its laws in 2000 to permit virtual shareholder meetings, audio and video streaming capabilities were limited. Today, however, many Internet users have access to broadband which provides them with the ability to watch or listen to live action programming. Moreover, the evolution of social media has changed the way that people use the web. Users are becoming more accustomed to interactive experiences, as opposed to static viewing of individual pages. Now with the advent of mobile devices, people can choose to have an interactive online experience wherever and whenever they wish. To help public companies take advantage of this phenomenon in their efforts to enhance good governance and extend their shareholder reach, Broadridge has developed several groundbreaking tools that have already been adopted by such major corporations as The Coca-Cola Company, Best Buy, TD Ameritrade and NutriSystem. All of them enable issuers to interact with shareholders who have been validated by a proprietary process, thereby ensuring greater control:
The Virtual Shareholder Meeting offers issuers the ability to conduct what may be their most important corporate governance function of the year electronically, on the Internet. Unlike most social media forums, however, the Virtual Shareholder Meeting limits participation to validated shareholders. Non-shareholders may hear and/ or view the meeting, if permitted by the company, but not vote or ask questions.
By employing this innovative approach, issuers can:
- Eliminate geographic obstacles that stand in the way of maximum participation by not only shareholders, but directors and management
- Reduce travel expenses and minimize security issues
- Gain greater insight from better shareholder attendance and the ability to solicit input, post questions and conduct voting on a real-time basis
- Portray themselves as a company that embraces innovation, values inclusion and cares about the environment
- Display their commitment to greater transparency and strong governance
Virtual Shareholder Meetings can be held in conjunction with a traditional annual meeting or in place of it. For many issuers wishing to employ a transitional approach, a hybrid annual meeting, incorporating in-person and virtual elements, has enabled them to evaluate the effectiveness of this new medium and assess shareholder acceptance.
The Shareholder Forum helps issuers prepare for their annual meeting and, in fact, it provides them with an ongoing means of communicating with validated registered and beneficial shareholders. Depending on issuer preference, the Shareholder Forum can be customized to:
- Contain content as varied as white papers, surveys and streaming video presentations by senior management.
- Solicit questions from shareholders that can be answered privately or displayed online in the interest of greater transparency and stockholder inclusiveness.
- Deploy year-round or on a seasonal basis to facilitate the proxy process and provide shareholders with content that will help them make more informed voting decisions.
Shareholder Forum limits access to shareholders of record and provides them with a convenient mechanism to access their ballots, vote their shares and even attend a Virtual Shareholder Meeting. At the same time, it provides directors and executives with a clear view of shareholder concerns that can help structure annual meetings for maximum impact. In addition, Shareholder Forum enables issuers to access a variety of real-time and weekly reports that can increase their understanding of how many shareholders are registered at the site, what their share ranges are and how many questions they asked and visits they made – all without compromising shareholder anonymity.
Mobile ProxyVote.com enables issuers to reach shareholders through their smart phones or tablets. Available at no additional cost to issuers or shareholders, Mobile ProxyVote®.com is not an app that requires downloading. Shareholders simply visit ProxyVote.com with a mobile device and undergo an interactive experience that allows them to vote their shares. Issuers increase their voting returns and reach quorum more quickly by providing shareholders with the ability to vote through the channel of their choice as soon as they receive their notice.
Broadening the information flow between directors, management and shareholders
Over the past several years, various industry constituents expressed concern about corporate transparency and a decline in proxy participation. The ability to communicate with shareholders and provide them with a voting mechanism through a channel that many of them have already embraced and many more will embrace in the future can only be a positive development for companies committed to strong governance and innovative investor relations.
“As corporate governance continues to evolve, there’s going to be a need for companies to interface with shareholders on a far more regular basis,” says Broadridge CEO, Rich Daly. “At Broadridge, we take great pride in being the first company to help shareholders and companies take advantage of the efficiencies, convenience and new avenues of engagement that the combination of social media and mobile technology provide.”
Contact John Dunn at John.Dunn@Broadridge.com
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