The Millstein Center calls on institutional investors to be more transparent about the way they act as owners of public corporations by disclosing how they vote, what ownership policies they follow, and what resources they put into engagement efforts.
Fund recommendations and the code of conduct are among a number of improvements to proxy voting systems and decision-making outlined in the Millstein Center policy briefing Voting Integrity: Practices for Investors and the Global Proxy Advisory Industry, which will be presented tomorrow at the International Corporate Governance Network mid-year meeting in Amsterdam.
“The economic crisis has highlighted as never before that the capital market’s health hinges on a reliable, open and efficient proxy voting system to keep corporate boards accountable,” said Ira M. Millstein, senior associate dean for corporate governance at the Yale School of Management. “The time has come for practical fixes.”
The briefing goes on to recommend that the U.S. Securities and Exchange Commission empanel an independent blue ribbon commission to modernize the U.S. share voting system; and that regulators should work with counterpart bodies in other markets to supervise the seamless integration of national systems to enable accurate and efficient cross-border voting.
Voting Integrity is based on independent research and insights from a roundtable of major U.S. and European institutional investors and proxy advisors convened by the Millstein Center on January 29, 2008 and chaired by Lynn Turner, former chief accountant to the SEC and former executive of Glass, Lewis & Co.