AP1-4 target global voting service for joint project
SWEDEN - The first four Swedish National Pension buffer funds (AP1-4) are seeking a provider of a global voting service to assist its move into voting on more specific stocks.
The tender notice follows the establishment of a joint pilot voting project between the four pension funds earlier this year, which was used to vote at the shareholder meetings of 300 foreign companies, on issues such as international initiatives and environmental and social responsibility related resolutions. (See earlier IPE article: AP2 calculates carbon footprint of portfolio firms)
Under the pilot project, each fund made its own decision for each individual company, and a Swedish corporate governance consultancy then administered the votes and a UK consultancy provided the electronic voting platform, with the companies chosen based on a range of selection criteria.
The tender notice just issued revealed the new procurement process - being advertised by AP1 on behalf of all four funds which will each sign separate agreements - is to appoint a global voting service with advice, as the buffer funds "expand the global voting to cover more specified stocks".
It noted the four schemes have voted at AGMs for 300 companies during 2009, and across stock markets in the US, Canada, Japan, UK, Switzerland, France, Germany, Spain, Italy and the Netherlands, though it does not plan to expand voting to any other markets.
It stated the procedure for the global voting service must be simple to administer because "we want to control our voting policy and final vote decision while outsourcing the processing and management parts of the process".
The requirements on the provider include research and a proxy voting service, in addition to advice and support similar to that provided by the Swedish consultancy used by the pilot project, which offered "some vote recommendations", according to the AP-funds' ownership policies, alongside the administration of the votes and assistance with the manual handling of ballots where the vote is not automated.
Final agreements will be to sign a global voting service and advice for a period of three years, but the AP-funds admitted that because they have not decided how to expand the global voting process the applicants must indicate a price relating to an investment universe of 300, 500 and 1,000 companies.
The closing date for tender submissions is 30 November 2009, and the agreements are then expected to be signed by 18 December 2009. Further information on the procurement can be obtained from AP1.
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