|  | | 2006 News and Press Releases | | |
HEADLINE NEWS:
Reducing The Proxy Vote's Paper Trail
Cindy Skrzycki
WashingtonPost.com. April 11, 2006
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EXCERPT: For most shareholders, the arrival of the annual meeting and voting season is announced with a shrink-wrapped package in the mail. It's as predictable as daffodils sprouting in a spring garden. That may change if publicly traded corporations decide to ditch all that paper and go electronic, as a proposed rule from the Securities and Exchange Commission would allow. Some 11 million investors already have elected to receive annual reports and proxy statements via computer, but 76 million more have yet to convert. The initiative is part of a push by the SEC to get more investors to use technology to manage their portfolios and to encourage more disclosure by companies. SEC Chairman Christopher Cox has stated his support for using the Internet to view documents, vote shares and be able to compare information among companies. "It's one of those ideas that everybody loves, but the devil is in the details," said Martin Dunn , the agency's corporation finance deputy director. "Everyone realizes that the use of electronic communication is increasing, and this is our attempt to get ahead of it." It's possible the final rule will be ready for the 2007 proxy season. Issuers can continue mailing to their shareholders, but the SEC expects many large companies to convert to electronic delivery if they think it will save money. The agency asked for comment on two approaches to break the paper habit. Under one scenario, shareholders would receive a notice in the mail of an impending annual meeting. They would be directed to a Web site with all the materials they need to vote and inform themselves of the issues. If they wanted paper, they would have to call a toll-free number or send an e-mail requesting it. This would have to be done every year for each stock they held or mutual fund they participated in. The other option: Shareholders would receive notice in the mail that proxy background materials were on a Web site. The notice would include a voting card, which would allow them to vote on paper and put it in the mail, while doing background reading on the Web. |
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