Just as the governance community is beginning to feel it might explode if another consultation comes its way, the battle for regulatory attention over the parlous state of the proxy system is hotting up in the US.

Computershare, the global securities service provider has weighed in with the launch of a website to raise awareness about what’s at stake. Reformtheproxysystem.com  is a collaboration between the members of the Subcommittee on Proxy Reform of the Securities Transfer Association (STA).  The STA companies involved include: American Stock Transfer & Trust Co., BNY Mellon Shareholder Services, Computershare, Ltd., Continental Stock Transfer & Trust Co., Georgeson, and Registrar & Transfer Co.

Considering the complexity and scope of the proposed reforms, it’s clear that the web-site is a timely addition to the behind the scenes lobbying that’s been taking place in recent years. Speaking to Manifest about the launch of the site, Paul Conn President, Global Capital Markets at Computershare said:

“This is the first time in almost 30 years that the SEC has conducted a root and branch review of the US proxy system. Like our industry peers, we felt it important to highlight what seems like a “once in a generation” opportunity for issuers and others to convey their views about the key principles and ideas set out in the SEC’s concept release. So we built the site to serve a dual purpose: education and a “call to action”. Knowing how little spare time most industry execs have these days, we also created a video that takes some of the core elements of the SEC’s 150-page release and distills them into a 2 minute animated video. It’s pretty entertaining, whether or not you’re an industry policy wonk or market structure geek. A significant number of our clients are supportive of change and are already planning to write to the SEC before the Oct 20th deadline. Hopefully the site will cause a few more to express their point of view to the Commission.”

Computershare is investing heavily in supportive research in an effort to bring the US proxy system up to date. To date, Computershare has surveyed over 1,200 of its small-to large-cap U.S. public company clients. Nearly 60 percent of these companies support reforms relating to increasing transparency of share ownership and facilitating more direct communications to shareholders, described in the SEC’s concept release. Only 5 percent of corporations were not in agreement with these reforms.

Other aspects of proxy mechanics under review include broker share reconciliation methods, vote confirmations for investors and greater overall transparency of the voting system and the integrity of the vote.  Reformtheproxysystem.com provides background and resources on these issues.

In closing, Conn said: “In the current environment of rapidly changing regulations, it is vital that companies and shareholders press for a highly-efficient and robust proxy system that will enhance corporate governance and effectively position the US capital markets for the next thirty years.” We couldn’t agree more.

Investors and issuers have until October 20th to let the SEC know their views.

Last Updated: 29 September 2010