Individual shareholder activist, Steven Towns, is our newest Advocate on Moxy Vote.  Towns is a member of the United States Proxy Exchange (USPX) and actively supports efforts to facilitate shareholder rights.  This proxy season he is getting the word out to retail investors about how to vote intelligently on the General Electric ballot.  In a recent blog post, entitled “General Electric Shareholders’ Latent Power,” Towns explains his personal interest in GE.  “In the case of General Electric (GE), one of the most widely held and actively traded stocks, all stakeholders should be aware of the abuses of a select few that impact many.  With external recourse nearly nonexistent, it is up to shareowners to realize the latent power of their proxy votes, vote accordingly, and effect change.”

This year, he has several opinions on the GE ballot, including director recommendations, “say on pay” and “say when on pay” votes, and shareholder proposals regarding cumulative voting and employee stock options.  Towns explains that “cumulative voting, which appears to be used at approximately 10% of S&P 500 companies, is a logical and fair counter against the outsized number of shares controlled by institutions (as in the case of GE).  It allows for shareholders to place a multiple number of votes on one director instead of the traditional one vote per director.”  Towns’ full recommendations for the GE ballot can be found on Moxy Vote.

After years of work, Steven has some valuable advice for shareholders, and it wouldn’t be fair to keep it all to ourselves.  Here are a few pearls of wisdom from his experience as a stockholder and shareholder advocate.

What do you think is the best way to help inform other shareholders about the importance of proxy voting?

“I think a website such as yours, Moxy Vote, is great. The consolidated platform (i.e. one-stop shop) is very convenient as it offers the proxy statement, the ballot, management’s recommendations, and Advocates’ recommendations. However, there is a serious obstacle in that very few individual investors know what a proxy statement is and thus voter participation is quite limited. On the institutional front, I am not sure whether it’s apathy or wanting to avoid upsetting companies for business reasons (or both), but voting closely follows management’s recommendations, which is highly problematic. Given the importance of proxy voting, I think that investors should receive notice upon opening a new account, and an annual reminder, of said importance. It could be an email, or electronic message or icon appearing next to your stock holdings on your brokerage’s website, but the point is that the message should say simply that as a shareholder you have the right to vote on executive pay, director elections, other proposed items by the board, and shareholder proposals. It would be great if sites such as Moxy Vote could be included as resources. And I think that’s fair, since you by default show management’s recommendations for the ballot and have a navigable information box for Advocates’ recommendations.”

Is there a certain type of shareholder resolution or initiative that you support most or feel most passionate about?

“I am particularly interested in seeing cumulative voting passed. It has become increasingly clear to me that individual investors and even governance-minded funds face a formidable opposition, even though the board to some extent is supposed to be looking after common shareholders. Management and directors are too close (negating the efficacy of having a board), are really entrenched (dubious board independence), and know the votes as they come in and therefore can work the phones with big institutional holders… With cumulative voting, however, I think investors will slowly but surely be able to make their voices heard.”

Own shares of GE stock and want to make a difference?  Be sure to VOTE alongside Steven and other Advocates BEFORE APRIL 23RD on Moxy Vote.  Stay up to date with Steven Towns’ work by checking out his Advocate page and following his blog.