Proxy vote records highlight greatly increased deference on key
environmental, social and governance issues
VANCOUVER, Jan. 29 /CNW/ - The Shareholder Association for Research and
Education's (SHARE (http://www.share.ca/)) eighth annual Key Proxy Vote Survey
(http://www.share.ca/files/SHARE_2008_Key_ProxyVote_Survey.pdf) has found a
significant increase in investment managers' willingness to support corporate
management's recommendations at the ballot box. The survey findings, released
today, sit awkwardly with continued revelations about lax corporate oversight
and its ramifications for the global economy.
"In Canada, we knew there were serious problems with a negative impact on
investment returns before the proxies were voted in 2008," says SHARE's
Director of Law and Policy, Laura O'Neill. "ABCP investments had soured and
huge write-downs were being taken by companies in the financial sector. The
response from private sector pension fund money managers appears to have been
to require less of companies on governance."
Every year, SHARE asks investment managers with Canadian pension fund
clients about their voting decisions on a number of key issues that proved
contentious in the most recent proxy season. For 2008, thirty-two firms
representing $453 billion in pension assets participated in the voluntary
survey. They were polled on 37 votes that appeared on the proxy ballots of
The investment managers averaged a score of 29% votes cast in accordance
with SHARE's responsible investment proxy-voting guidelines. This stands in
sharp contrast to the lowest average recorded by SHARE in past surveys (44%).
"Last proxy season, a handful of surveyed voters maintained their
vigilance on key issues. But others missed many opportunities to send a clear
message to management when they voted for proposals that were not in
shareholders' best interests," explains Peter Chapman, Executive Director of
SHARE. "Similarly, firms were more reluctant than in previous years to support
shareholder proposals that sought better corporate performance on
environmental, social and governance matters."
The survey questions and responses do not allow SHARE to examine the
rationale behind the managers' votes, so it is not possible to explain
precisely why a retrenchment occurred in 2008. However, SHARE encourages
pension fund trustees to sit down with the firm that votes their funds'
proxies and find out.
An encouraging trend from this year's survey was an increase in the
number of pension plans giving their proxy-voting agents (investment managers
or proxy-voting service) direction on how their proxies should be voted. Less
than two-thirds (63%) of survey respondents indicated that they exercised
discretion for voting over the accounts of most of their pension clients. In
2006 and 2007, discretion was exercised by 77% and 71% of firms respectively.
It is positive to note that fewer pension funds left their proxy-voting
decisions to investment advisers, particularly in a year when those managers
voted in-line with management much more often on key issues.
About SHARE: SHARE is a national social enterprise dedicated to improving
institutional investment practices that protect the long-term interests of
pension plan members, beneficiaries and society in general.
Editors Note: The SHARE 2008 Key Proxy Vote Survey is available for
download at: www.share.ca
For further information:
For further information: Peter Chapman, Executive Director, or Laura
O'Neill, Director of Law and Policy, (604) 408-2456, email: email@example.com,