Interactive Investor

ii empowering investors to vote at AGMs, creating industry ‘tipping point’

1st November 2021 09:08

Jemma Jackson from interactive investor

UK’s second-largest DIY investment platform opts in all customers for voting and AGMs.

  • UK’s second-largest DIY investment platform opts in all customers for voting and AGMs.
  • Amanda Blanc, Group CEO and George Culmer, Chair, Aviva, say: “An important section of Aviva’s shareholder base comprises private investors. We firmly believe all shareholders, including private investors, should actively vote and participate in company AGMs.”
  • Helge Lund, Chair, BP says: “As a greening company navigating the energy transition, BP needs the support and challenge that only engaged shareholders can provide.”
  • Investment trust chairs add their voice on importance of shareholder voting, including Sir Laurie Magnus, chairman of The City of London (LSE:CTY) Investment Trust “[shareholders] can also influence the environmental, social and governance practices of their investee companies at a time when such considerations, particularly in the context of climate change, are receiving increasing attention.”

Hundreds of thousands of UK private investors are being empowered to vote at shareholder meetings, using a free service from interactive investor, the UK’s second-largest direct-to-consumer investment platform.

Instead of having to opt-in to use the platform’s voting capability in their online account, as has been the case historically, ii has made being able to vote at company annual general meetings, and other voting events, the default setting (but customers can still opt out if they wish)*.

Customers will now be notified when they are eligible to place a vote via ii’s ‘voting mailbox’ service online (unless they unsubscribe from the service), as well as being notified of shareholder events, such as AGMs.

This means that whereas in the first half of 2021, just under a fifth of interactive investor’s more than 400,000 customers were registered to vote on the investment platform, now the facility has been switched on across the board.

Richard Wilson, Chief Executive Officer of interactive investor, says: “This is not just a step change for interactive investor’s hundreds of thousands of customers, but, we hope, the start of a tipping point in the wider platform industry, through which millions invest – including through pensions and ISAs.

“Everyone deserves to be given the tools to make their voices heard by UK PLC – and there is strength in numbers. Shareholder democracy and engagement shouldn’t be inhibited by red tape or time-consuming bureaucracy – especially in today’s world where technology provides simple, time-saving solutions.

“We have seen how a default setting in the form of automatic enrolment for company pensions has had a huge and beneficial effect on savings for retirement. By making the ability to vote online the default for shareholders, we hope to increase the popularity of another aspect of investing that is valuable and important. The ability to vote simply and easily should become the new normal.”

Business leaders comment on the power of retail investor votes

Amanda Blanc, Group CEO and George Culmer, Chair, Aviva (LSE:AV.), say: “At Aviva we place considerable importance on communication with all shareholders. It provides valuable feedback for us, helping us to evaluate whether the strategy we have set and our delivery aligns with the expectations of our shareholders. 

“An important section of Aviva’s shareholder base comprises private investors.  We firmly believe all shareholders, including private investors, should actively vote and participate in company AGMs. These are important rights that provide shareholders with a say in how their company is run and an opportunity to elect those responsible for its management and oversight. For us, as directors of Aviva, the participation of private investors in our AGM provides a key opportunity to engage directly with this section of our shareholder base, to hear their views and to answer their questions. Without this participation this important and valued dialogue would be lost.”

Helge Lund, Chair, BP (LSE:BP.) says: “At bp, we never forget who owns the company. The board I lead knows that to succeed, we must listen to our shareholders – as well as all our other stakeholders including customers, employees and society.  

As a greening company navigating the energy transition, bp needs the support and challenge that only engaged shareholders can provide.That’s why it’s really important to us that we routinely meet with our shareholders, and we encourage them to use their votes to shape our company’s future.”

Sir Laurie Magnus, chairman of The City of London Investment Trust: “Private investors need to make their views known to the companies where they are shareholders and therefore ultimate owners. They are more directly affected by what happens at these businesses than intermediaries who manage share portfolios on behalf of others. The performance of their shares, both in terms of price movements and income yield, translates directly to their back pockets. 

“Their attendance at company meetings and active voting is therefore really important and wise boards of directors will welcome their participation. In particular, attendance at AGMs enables shareholders to hear directly from company management and put questions to them. They can also influence the environmental, social and governance practices of their investee companies at a time when such considerations, particularly in the context of climate change, are receiving increasing attention. 

“Private investors often face a struggle to exercise their voting rights because of logistical challenges. It is therefore good to see interactive investor’s commitment to shareholder engagement and encouragement for shareholders to exercise their rights.”

Andrew Bell, CEO, Witan (LSE:WTAN) Investment Trust, says: “As an investment trust that is overwhelmingly owned by private investors rather than institutions, Witan is keen to encourage communication with our shareholders and to facilitate voting and participation in our Annual General Meetings whether directly or via platforms such as Interactive Investor. We welcome the steps Interactive Investor have taken to support both our communications and AGMs by ensuring their clients are given notice of financial reports and can easily lodge their votes for AGMs. With increasing focus on good corporate governance, including clear reporting and accountability to shareholders, encouraging all our investors to vote their shares remains a key objective for Witan.”

Simon Hayes, chairman, Finsbury Growth & Income (LSE:FGT) Trust plc, says: “Finsbury Growth & Income Trust PLC is an investment trust with a market capitalisation of c.£2 billion and is a member of the FTSE 250 Index. In the past decade our shareholder base has seen a material shift towards retail investors, with some 42% of our equity now in the hands of shareholders investing through retail platforms, including a significant proportion via interactive investor. 

“It is important that Finsbury Growth & Income Trust plc engages effectively with, and encourages participation from, all relevant stakeholders.”

Fiona McBain, chair of Scottish Mortgage (LSE:SMT) Investment Trust PLC, says: “The Board of Scottish Mortgage Investment Trust PLC fully shares Baillie Gifford’s belief in the value of being responsible long-term owners of the businesses in which they invest our shareholders’ capital. Company engagement is accordingly deeply embedded in Scottish Mortgage’s philosophy and approach. In turn, the Board views the support of our own investors as similarly important to our long-term value creation for them. Therefore, we encourage all shareholders to engage with their investments and exercise their right to vote.”

Clare Dobie, Non-Executive Director of Alliance Trust (LSE:ATST), says: “We very much encourage voting and shareholder attendance at AGMs and our regular Investor Forums; it’s part and parcel of good governance to make sure shareholders’ voices are heard and that they get an opportunity to engage directly with the Board and investment manager.

“We are proud that we have historically had well-attended AGMs. It’s unfortunate that, due to the pandemic, at the last two we have not been able to have our shareholders physically present at the meetings. Online meetings are not a perfect substitute for in-person events, but they do have the benefit of providing the opportunity for shareholders in more distant locations to participate. Our recent Investors Forums have also reached a much wider geographical audience for being online. 

“There are no plans to hold completely virtual meetings, and we very much look forward to the time when we can once again interact with shareholders in person.  During the pandemic, the Board asked shareholders to approve changes to the Company’s Articles to permit more flexibility in how future AGMs could be held to take account of shareholders not being physically present, which they did. So we can now use a mix of both virtual and physical meetings to engage with as many of our shareholders as possible.”

Interactive investor shareholder democracy campaigning

Today’s announcement follows extensive campaigning by interactive investor on shareholder democracy. This includes a campaign to help raise awareness among retail shareholders about voting and AGM issues, and how they can make their voices heard. interactive investor argues that there is strength in numbers – investors do not have to be drowned out by large institutions. Over the past several months ii has:

  • Enhanced its shareholder voting and information page with educational articles and videos
  • Published regular articles to alert customers to upcoming AGMs, highlighting relevant corporate voting issues
  • Published regular data on our customer voting trends, to help raise the profile of voting
  • Written to customers about our voting service
  • Interactive investor also won the Association of Investment Companies (AIC) Shareholder Engagement Award in September 2021, as judged by the Lang Cat.

Notes to editors

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