Why Companies Should Maximise Shareholder Communication

One very effective way of showing that your company can motivate and communicate with its shareholders is through maximising the voting turnout. It is also a good means to insulate a company against the potential risks of future dissent. The key is to get companies to maximise their proxy voting engagement through getting to know their shareholders and them maximising their engagement in the process.

When companies are able to maximise shareholder engagement during a proxy voting, it is a clear indication that the company knows its shareholder base very well, it also knows how to get in touch with the readily, and it is able to effectively communicate with them. This is a good way to boost the perception that the company is not only transparent, but one that is accountable, and also enjoys its shareholders’ confidence.

There is no such thing as a working formula when it comes to telling if a company is enjoying a level of shareholder engagement that is satisfactory. There are instances when it may be due to the prevalent use and or ownership of nominee accounts which makes many underlying shareholders unaware that the meetings even took place. However, if the company has experienced turnout that is lower than average, then it can be an indication that it may not have that much knowledge of its shareholder base and engagement is not really as wide-reaching as what would have been ideal.

Companies should strive at maximising participation now. This is because it will help secure better shareholder support in the future. These days, increase in compliance standards and corporate governance mean that there is less fear when it comes to voting against the management as there is also increased scrutiny on the resolutions being passed.

Maximising shareholder engagement is important if one were to prepare for those instances when activist investors are going to turn up- something that has since been advocated by Boudicca Proxy. While it is quite impractical to get a blanket coverage of all the company’s shareholders, maximisation is always the best possible means to identify any underlying shareholder that are behind nominee accounts. This way, contacting and communicating with them regularly is going to be more than feasible.

It is the ability of a company to engage with shareholders constructively that will help reduce the chance of getting negative votes. Companies should also comply, explain, and then engage their shareholders. Maximising the participation of active shareholders is also a sure-fire way of limiting the chances of shareholders resorting to activist methods just so they can be heard. When companies know their shareholder base very well, ensuring that proper communication is established in between will keep activism at bay.

Maximising the turnout in the proxy voting is no longer something that a company has to do on its own. Specialists such as Boudicca Proxy can help bring to light much of the shareholder base of a company. Then, getting in touch with them and reaching out to them is going to be so much easier to do. Learn more about the importance of shareholder engagement by reading about Boudicca Proxy online.