UK – Crestco Ltd., the UK subsidiary of Euroclear, is to launch an electronic proxy voting service on January 20 in response to increasing market demand.
The service aims to allow dematerialised, or paperless, shareholders to exercise their proxy votes in “a straight-through and timely manner”. It will offer investors a secure, standardised and efficient system for communicating proxy appointments and voting instructions. For issuers, the new service will allow them to ascertain the status of the voting procedure in real time.
Company meeting announcements, the appointment of and instructions to a proxy, and the results of company meetings will be provided electronically through the service in formatted messages for investors and issuers.
“Given the growing importance of investor communications in corporate governance, the speed, efficiencies and benefits offered by Crestco’s new proxy voting service should further improve voting rates in 2003,” says Michael Kempe, head of issuer and investors services at Crestco.
Kempe added that investors and trade organisations were enthusiastic about the new proxy voting service, and were eager for issuers to use it.
Paul Marsland, manager at PIRC, Pensions Investment Research Consultants, welcomed the new platform. “There have been problems traditionally with voting levels in the UK. We measure them every year and they have only just moved beyond 50%. Hopefully this platform will push voting levels higher quite rapidly.
“The other advantage is that shareholders will receive confirmation of their votes, which just doesn’t happen at the moment.”
“We would like to see this taken further and eventually rolled out across Europe. Now that Crest is owned by Euroclear, hopefully this will happen, “ added Marsland.
A spokesman at Crest confirmed that the company may well look at producing something similar for markets other than the UK – depending on the success of the new service.
Electronic shareholder communication is one of the recommendations of the Winter group, a high-level group of corporate law specialists that reported to the European Commission late last year.