European shareholder voting better if lacking drama – ISS

Shareholders in Europe voted more this proxy season than ever before, but that did not translate into radical action. Institutional Shareholder Services, the proxy voting agency owned by MSCI, calculated that the UK saw the biggest rise in participation in company annual meetings, thanks to the new Stewardship Code, which many of the largest asset managers adopted for the 2011 proxy season. Despite the turbulence in European markets in the past year, dissent from investors over management proposals was steady overall. Greater resistance to requests to authorise additional capital was offset by less concern about electing directors, discharging them of their responsibilities, or rejected proposals on mergers and acquisitions. Some highlights:

• Turnout: Participation in the UK moved above 70 per cent, the highest level in ISS's record and probably in living memory. It wasn't the best in Europe, however. That honour goes to Portugal, at 73 per cent. Greece and Ireland saw large increases, too, for reasons that may be obvious. The EU average was 62.6 per cent. Voting in Denmark was the lowest – just 37.2 per cent.
• Dissent: French companies saw the highest level of shareholder dissent about management proposals, but at 6.0 per cent it was the lowest in the four years surveyed in the report.
• Result disclosure: More companies reported the outcome of votes but that didn't stop ISS from complaining: "… given that full disclosure is now legally required in most markets surveyed, it is disappointing to record that only five markets have all companies disclosing their results in full."

Source document: The ISS European voting report is a 23-page pdf file.