The Securities Transfer Association, Inc. Supports Securities and Exchange Commission Concept Release

NEW YORK, July 19 /PRNewswire/ -- The Securities Transfer Association, Inc. (STA) is pleased to announce its support of the Securities and Exchange Commission's (SEC) concept release on the U.S. proxy voting system. The STA, along with other industry organizations, has been very active for many years in advocating a fair and efficient system for public companies to share information with their shareholders, including proxy communications. 

The recent concept release published by the SEC is a very significant step towards realizing greater efficiency and transparency in an area of the financial markets that has remained unchanged for decades. The release discusses changes to the overall proxy system that, should they occur, will give issuers greater choice in service providers for their shareholder communications efforts, and will give retail investors more opportunity to be more informed and engaged.

STA President Charlie Rossi said, "If implemented, changes to the proxy system could provide issuers with more control of shareholder communication costs, greater accuracy in the voting process, improved participation by holders in the voting process, and an overall enhanced ability to communicate directly with all holders – both registered and beneficial."

The STA is urging public companies to participate in the possible reform of the proxy system by submitting their views to the SEC during the 90-day comment period of the concept release. In doing so, issuers will have a voice in creating positive change for themselves and for the market in general.

In a time when good corporate governance is the main focus of many shareholders, the SEC's action is an important step in reforming the current system for shareholder communications.

Today, public companies have no choice but to participate in a proxy system that is antiquated and inefficient, and is prone to more error, heavier costs, and greater restriction of two-way communications than if the potential changes discussed in the release were implemented.

Moreover, investors remain unaware of the communication restrictions that are in place. Ultimately, shareholders are bearing the costs of an outdated and inefficient system that unnecessarily diverts capital from productive endeavors and reduces the frequency with which public companies are able to communicate with shareholders.

The SEC's concept release covers three core areas: Accuracy, transparency, and efficiency of the voting process; communications and shareholder participation; and the relationship between voting power and economic interest. Specific issues identified in the release include:

• Over-voting and under-voting of shares
• Proxy vote confirmation
• Proxy voting by institutional securities lenders
• Proxy distribution fees
• Issuers' ability to communicate with beneficial owners of securities
• Potential means to facilitate retail investor voting participation
• Data-tagging proxy-related materials
• The role of proxy advisory firms
• Dual record date
• Empty voting

About the STA

The STA is an industry trade association for transfer agents. Founded in 1911, the STA represents more than 150 commercial stock transfer agents within the United States, including corporate and mutual fund transfer agents. Collectively, STA members serve as transfer agents for more than 15,000 publicly traded corporations, aggregating more than 100,000,000 shareholders.

SOURCE The Securities Transfer Association, Inc.