Interactive Investor

30% jump in shareholder votes processed in 2022, says ii

11th January 2023 09:19

by Jemma Jackson from interactive investor

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interactive investor reports its 2022 data on UK private investor voting behaviour.

megaphone vote agm
  • Lloyds Bank, followed by BP, GSK and Aviva generated the most votes in 2022
  • Plenty more high-profile meetings allowed investors to have their say, while police removed climate protestors from Shell’s May AGM

At a time when there is little published data on UK private investor voting behaviour, interactive investor, the UK’s second-largest investment platform for private investors, today reports its 2022 data for the full calendar year. 

The investment platform saw a 30% increase in the number of votes processed, from 162,673 in 2021 to 210,801 in 2022.

AGM attendance, as measured by the number of unique accounts requesting letters of representation, doubled. This was from a very low base –  720 letters were sent in 2022, up from 359 in 2021, 263 in 2020, and beating pre pandemic levels (651 in 2019). This emphasises the challenge UK PLC and the wider platform industry face if AGMs are to gain broader engagement. 

This significant progress over just one year comes after interactive investor made customer shareholder notifications for UK listed securities opt out, rather than opt in. This change, in November 2021, immediately removed a major barrier to retail investor participation.

But the picture is nuanced. The percentage of votes used in 2022 fell to 8%, compared to 14% in 2021. This is likely because, having enrolled the wider customer base, the ability to vote on interactive investor is no longer the preserve of those with a more natural inclination to do so. 

The interactive investor data comes as the Government’s Digitisation Taskforce prepares to publish its initial findings, by spring 2023, around the UK’s current shareholding framework. It will take forward Mark Austin’s Secondary Capital Raising Review recommendations. This includes the challenge to drive forward full digitisation of shareholdings, better facilitating the rights associated with direct share ownership, including voting.

Richard Wilson, Chief Executive, interactive investor, says: “Private investors can have a powerful collective influence over a company’s conduct and future direction through their vote, should they wish to use it. And we believe it is our duty to facilitate this. Our latest numbers are hugely encouraging and are a timely reminder that you don’t always need to reinvent the wheel to affect positive and significant change. Sometimes, you just need to remove barriers and red tape. We know there is far more to do.  

“Nor are we complacent. But our data should be food for thought for the industry. We shouldn’t let UK PLC off the hook, either – shareholder communications need to be far better tailored to private investors, who have been disenfranchised by legalese for too long.”

Plain English

Last year, interactive investor called on the UK’s financial authorities to support private investors by introducing guidance on plain English matching that given by the US Securities and Exchange Commission.

interactive investor called on the Financial Reporting Council and the Financial Conduct Authority to collaborate to produce a guide similar to that of the SEC’s A Plain English Handbook. It has also engaged with the Treasury on this issue, and believes that to encourage shareholder engagement and enfranchisement, companies need to use multimedia to stay relevant. For example, ii would like to see issuers host videos in advance of an AGM, setting out the issues, including pre-emption rights.

Number of votes processed from 2019 – to 2022

Number of votes processed

2019

43,753

2020

78,986

2021

162,673

2022

210,801

Percentage of votes used

2019

6.0%

2020

8.1%

2021

13.6%

2022

7.8%

The popular votes: which captured the most attention from investors in 2022?

Lee Wild, Head of Equity Strategy, interactive investor, says: “As the most widely owned stock in the UK, Lloyds Banking Group (LSE:LLOY) continues to generate the most engagement with shareholders. But there were plenty of other high-profile meetings in 2022 that gave investors a chance to let companies know what they thought of them. On occasions, one side might have wished they hadn’t bothered.

Aviva (LSE:AV.) used its annual get-together to wave through a £4.75 billion return of capital, but it was the behaviour of some shareholders that grabbed the headlines, and for the wrong reasons. Sexist comments aimed at Amanda Blanc, Aviva’s first female CEO, proved there is still work to be done eradicating behaviour more fitting to the Dark Ages. A topic very much of the modern age continued to cause chaos at AGMs held by the major oil companies.

“After police removed climate protestors from Shell (LSE:SHEL)’s meeting in May, it emerged that 20% of shareholders voted against the firm’s energy transition strategy. The same number voted in favour of a special resolution forcing Shell to do more to cut greenhouse gas emissions. A fifth of votes going against the majority demonstrates the power that shareholders wield, although, in this instance, the enthusiasm for change was significantly lower than the previous year. It was a similar story at BP (LSE:BP.).

“It was a much more predictable outcome at GSK (LSE:GSK), where shareholders rubber stamped the drug giant’s demerger of its £29 billion consumer healthcare business Haleon (LSE:HLN). Despite poor performance in the aftermath, any regrets will have been dismissed by a recent rally to record highs.”

Most voted shares on ii in 2022

RANKING

ISSUER NAME

MEETING DATE

MEETING TYPE

1

Lloyds Banking Group (LSE:LLOY)

12/05/2022

AGM

2

BP (LSE:BP.)

12/05/2022

AGM

3

GSK (LSE:GSK)

06/07/2022

OGM

4

Aviva (LSE:AV.)

09/05/2022

AGM

5

Vodafone Group (LSE:VOD)

26/07/2022

AGM

6

GSK (LSE:GSK)

04/05/2022

AGM

7

Rolls-Royce Holdings (LSE:RR.)

12/05/2022

AGM

8

Shell (LSE:SHEL)

24/05/2022

AGM

9

Aviva (LSE:AV.)

09/05/2022

OGM

10

Scottish Mortgage (LSE:SMT)

30/06/2022

AGM

These articles are provided for information purposes only.  Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties.  The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.

Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.

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