On January 29, 2015, members of the Canadian Securities Administrators (“CSA”) published CSA Staff Notice 54-303 - Progress Report on Review of the Proxy Voting Infrastructure (the “Progress Report”) to update the progress of their ongoing review. The Progress Report concludes that the current proxy voting infrastructure is in need of modernization and improvement.
The Progress Report enumerates five improvements that CSA members feel must be made regarding vote reconciliation:
- modernizing how meeting tabulators receive information about who is entitled to vote;
- ensuring that the information meeting tabulators receive is accurate and complete;
- enabling each intermediary who submits proxy votes on behalf of clients to find out how many shares the intermediary is entitled to vote, according to calculations made by meeting tabulators (its “Official Vote Entitlement”);
- increasing consistency in how meeting tabulators reconcile proxy votes submitted by intermediaries to Official Vote Entitlements; and
- establishing communication between meeting tabulators and intermediaries about whether proxy votes are accepted, rejected or pro-rated.
The CSA is directing all entities that play key roles in vote reconciliation to assess their processes and identify ways to improve vote reconciliation for the 2015 proxy season. The CSA has released a Request for Proposals for expert advice from a proxy solicitor and plans to continue their review throughout 2015.