Interactive Investor

‘More DIY investors making their voices heard’

10th January 2022 12:24

Jemma Jackson from interactive investor

interactive investor shows meaningful rise in votes processed in 2021.

·       Royal Dutch Shell, Lloyds (LSE:LLOY) and BP the three most voted companies on ii in 2021

·       It’s become easier to express personal opinions publicly - why shouldn’t shareholders have their thoughts heard by the big corporations too?

Shareholder activism can be a powerful tool for creating long-term and meaningful change. It is one of the most effective tried-and-tested ways of holding large corporates to account – and more DIY investors are getting in on the action. And with more of a focus on Environmental Social and Governance (ESG) considerations, shareholder activism has perhaps never felt so important.

interactive investor today publishes encouraging numbers, with the number of votes processed on ii in 2021 up 110% on 2020: 161,904 in 2021, compared to 77,185 the previous year.

In November 2021, interactive investor, the UK’s second-largest direct-to-consumer investment platform, began paving the way for greater access to voting for DIY investors by automatically opting in customers to its voting and information service. Customers can select to opt out if they wish, rather than previously having to select to opt in. The move followed an education campaign on voting started by the platform at the start of 2021.

Lee Wild, Head of Equity Strategy at interactive investor, explains: “The proliferation of social media has given us all a platform to air our views on everything from sport and politics to celebrity gossip and favourite TV shows. It’s become easier to express personal opinions publicly and most of us now do it every day, so why shouldn’t shareholders have their thoughts heard by more of the big corporations they own a stake in? With strength in numbers, there’s a real opportunity to hold businesses and the people who run them to account.” 

Richard Wilson, Chief Executive Officer of interactive investor, says: “Investment platforms are the gateway through which millions of people invest. They are easy to use, but most are missing a basic function when it comes to voting - all but the most determined investors have been shut out. That’s bad for shareholder democracy.

“Not everyone wants to vote, but let’s give investors that option. And let’s not underestimate them, either: since we started our voting education campaign in January last year, we processed 110% more customer votes in 2021 compared to 2020 – more than 160,000 of them. It won’t all be down to our educational efforts, and there’s lots more to do. But it shows that a little effort can go a long way. Imagine what could be done if the whole industry did more.

“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. Having made the ability to vote online the default for our customers last November, we hope to increase the popularity of another aspect of investing that is valuable and important. It could become the new normal.”

Lee Wild, Head of Equity Strategy at interactive investor, adds: More shareholders than ever are seeing the advantages of becoming more involved in the way their companies are run. And the more of them that exercise their right to vote at company meetings, the greater the influence they can have. We see time and again how effective professional activist investors can be at achieving change at underperforming companies, and management can be held to account by smaller shareholders, especially if they vote in numbers. 

There’s increasing pressure on companies to give all shareholders, not just the big banks and fund managers, a say in major decisions. So, expect more opportunities to make your views known. AstraZeneca (LSE:AZN) has already discovered the strength of feeling about its generous boardroom pay, GlaxoSmithKline (LSE:GSK)’s investors had a say on future strategy, and in June investors got to vote on the directors’ share qualification rule at Scottish Mortgage (LSE:SMT). Both Unilever (LSE:ULVR) and Shell (LSE:RDSB) put plans to simplify their share structures to shareholders, and emotive issues such as climate change are also attracting greater attention. Special resolutions gave investors a great chance to let both BP (LSE:BP.) and Shell know what they thought of their approach to this hot topic.”

Top 10 most voted shares in interactive investor in 2021:

ROYAL DUTCH SHELL PLC 10-Dec-2021
LLOYDS BANKING GROUP PLC 20-May-2021
BP PLC 12-May-2021
VODAFONE GROUP PLC 27-Jul-2021
GLAXOSMITHKLINE PLC 05-May-2021
AVIVA PLC 06-May-2021
ROYAL DUTCH SHELL PLC 18-May-2021
ASTRAZENECA PLC 11-May-2021
SCOTTISH MORTGAGE INVESTMENT TRUST PLC 24-Jun-2021

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.