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Proxy Voting

Tuesday, 25 August 2020   (0 Comments)
Posted by: Robert Brown
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August 2020


Proxy Voting and AGMs - Procedural inefficiencies for institutional investors




In September 2012 the Corporations and Markets Advisory Committee (CAMAC) presented a discussion paper titled “The AGM and Shareholder Engagement”. ACSA formally responded at the time with focus on procedural inefficiencies impacting institutional investors and custodians, in particular proxy voting.


Fast forward to 2020. Despite good intentions, reform from this CAMAC initiative did not eventuate.  We believe that there are significant landscape changes that make the issues well worth revisiting:

  • procedural inefficiencies, a lack of transparency and challenges in tracking votes through the proxy lifecycle remain.These issues add friction through the value chain;
  • COVID-19 disruptions (including virtual AGMs) have amplified some of these inefficiencies, and show opportunities to retain the positive lessons learned;
  • technology has marched on, and when applied to the proxy voting use case, opens up opportunities (that can be further enabled through standards and the changes outlined below);
  • European regulations (Shareholder Rights Directive II) casts a long shadow, including on Australian institutions.Opportunities to leverage domestic solutions for global application;
  • The rise in importance of Governance (the “G” in ESG) continues to drive the need for asset owners to have visibility of their votes and demonstrate alignment to policy.



ACSA is advocating market standards to improve efficiency, transparency and certainty.  The following summarise current focus:

  1. Standardisation in electronic form for the proxy voting lifecycle, including:
    • announcements;
    • electronic delivery of proxy voting instructions; and
    • standardised electronic reporting of voting results.
  2. True record date – remove the ambiguity of the current Corporations Act provisions and practical market cut-offs.
  3. Streamlined processes for the appointment of corporate representatives.
  4. Standardised market practice for voting exclusion.



Policy Consultant John Butler and CEO Robert Brown are co-ordinating the initiative. A subcommittee of the Operations Working Group is supporting with practitioner guidance, and ACSA is also reaching out to consult with other interested parties.


Formal external engagement is planned for September.



The following selected articles provide background and current focus on the challenges of proxy voting and inefficiencies for institutional investors in Australia, plus a summary of the impacts of Shareholder Rights Directive II (SRD II).



The Corporations and Markets Advisory Committee (CAMAC) was established in 1989 under the Australian Securities and Investments Commission Act 2001 to provide advice and recommendations to the Minister about matters relating to corporations and financial services law, administration and practice. As part of the 2014-15 Budget, the Government announced its decision to cease the operation of CAMAC, and this eventually came into effect on 21 February 2018.  The CAMAC website remains accessible, and shows all submissions (including the one made by ACSA in 2012):

The AGM and Shareholder Engagement

Download the discussion paper  (September 2012)


Download the updated discussion paper and summary (December 2012)


Submissions on the AGM and Shareholder Engagement discussion paper


Parliamentary Joint Committee on Corporations and Financial Services

Better shareholders – Better company, Shareholder engagement and participation in Australia

23 June 2008


Chapter Four - Improving corporate accountability mechanisms

This chapter discusses the shareholder decision-making and accountability aspect of engagement. Shareholder voting on director appointments and other resolutions at company meetings is an important tool for shareholders to ensure the accountability of company boards. The following discussion examines issues raised during the inquiry concerning possible deficiencies and potential improvements to the framework for corporate governance accountability. In broad terms, these issues fall into two categories:

    • the efficacy and integrity of different voting mechanisms; that is, the vote lodgement and recording process; and
    • the capacity for shareholders to exercise their voting entitlements effectively.

Joint Committee Report 2008


Ownership Matters

Corporate Voting – improving the voting system (2017)


“The current voting system for listed companies in Australia is unwieldy and in need of reform, as was outlined in this 2012 report we prepared for ACSI: ‘Institutional Proxy Voting in Australia’. We uncovered evidence of miscounted votes, timing issues with voting entitlements, manual processes, lack of transparency and the absence of an audit trail”.

Ownership Matters Research


CHESS Replacement 

New Scope and Implementation Plan Consultation (April 2018)

Corporate actions – Electronic proxy voting


“ASX plans that the new system will provide the ability for electronic proxy voting for all relevant issuer meetings. As part of the requirement, the record date relative to the meeting date will be standardised so that the record date will be a fixed number of business days prior to the meeting date. The requirement also has potential to involve the extension of proxy voting to underlying beneficiaries. The extension of the mechanism to underlying beneficiaries is dependent upon the implementation of the business requirements allowing for the recording of additional investor information and centralised data capture and storage scheduled for Day 1 implementation (Section 2.2.2 and Section 2.2.3)”.

Chess Replacement - New Scope



“Institutional investors from around the world can now register their votes for Australian Annual General Meetings (AGMs) in less than 30 seconds, thanks to the widespread adoption of Proxymity, Citi and Computershare’s pioneering digital proxy and investor communication platform.

Using Proxymity, companies can receive real-time confirmation of investor votes as soon as they are entered onto the platform, from the meeting announcement through to the voting deadline. By removing the complex ownership chain, Proxymity delivers increased transparency, enhanced efficiency and improved risk mitigation”.

Computershare Product Highlights


Senate Select Committee

Financial Technology and Regulatory Technology

30 June 2020

Members in attendance: Senators Bragg, Scarr, Marielle Smith.

See pages 17 to 25 in particular for the following witnesses:

BOWERING, Ms Ann, Chief Executive Officer, Issuer Services, Australia and New Zealand, Computershare Ltd

MATHESON, Mr Ian, Chief Executive Officer, Australasian Investor Relations Association

McKENNA, Mrs Lysa, Co-Chief Executive Officer, Corporate Markets, Link Group

REID, Mrs Marnie, Head of Shareholder Services, AMP

Meeting Transcript



Your Ultimate Guide to the Shareholder Rights Directive II

April 2019

“From 2019, SRD II (Shareholder Rights Directive II) will have a far-reaching impact on the investment industry. And yet, however noble or necessary its aims are, many companies are still uncertain about what SRD II is, let alone what they can do to ensure they comply with – even thrive in the wake of – the new laws it’ll bring into force. So you can better understand SRD II – particularly the implications for issuers, investors, intermediaries and other parties – we’ve put together a fairly thorough, if plainly worded, guide to get you started”.

Proxymity SRD II Paper


Joint trade association letter (including the Association of Global Custodians) on the impact of COVID-19 on the further implementation of the Shareholder Rights Directive II 

9 April 2020


Trade Association Letter



European Central Bank - Timeline for Wave 2 Implementation of ISO20022 messaging for Corporate Actions

2 December 2019


ECB ISO 20022 Timeline



“With great interest, SMPG has followed and participated in the harmonisation initiatives triggered by the Shareholder Rights Directive II (SRD II), which, along with its Implementing Regulation (IR), aims to increase the level of information provided by issuers to their shareholders, via the chain of intermediaries or directly.

Following a dedicated meeting with DG Justice at the European Commission in September 2018, the SMPG took the lead in preparing SRD II compliant messaging flows, comparing existing ISO 15022 and 20022 messages with the minimum business data requirements in the IR. The aim was to define compliant message standards that could be adopted by the industry as efficiently as possible”.



SWIFT Comply with the Shareholder Rights Directive II (SRD II)


Shareholder Rights Directive ii


ISO 20022 Standards

ISO 20022 Message Definitions.

General Meeting (Proxy Voting) Message Set


ISO 20022 Message Definitions




About the Australian Custodial Services Association (ACSA): The Australian Custodial Services Association (ACSA) is the peak industry body representing members of Australia’s custodial and investment administration sector. Our mission is to promote efficiency and international best practice for members, our clients and the market. ACSA works with peer associations, governments, regulators and other market participants on a pre-competitive basis to encourage standards, process consistency, market reform and operating efficiency. Established in 1994, ACSA members currently hold assets in excess of $4 trillion in custody and under administration for Australian institutions. 

Important Note: The views expressed in this communique have been prepared by ACSA for the purposes of general information to Members   The comments in this letter do not comprise financial, legal or taxation advice and should not be regarded as the views of any particular member of ACSA

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