There are plenty of reasons why the majority of retail investors fail to cast their proxy ballots each year. Too complicated, too time-consuming or too insignificant are how many of them view company disclosure materials or their own vote. This proxy season there's a more approachable way for individual investors-who own an estimated 30% of all outstanding shares of stock-to add their voice to hot button issues.
MoxyVote.com, a social networking Web site launched six months ago by Moxy Vote LLC, enables individual investors to link their brokerage accounts for automatic delivery of proxies, align themselves with dozens of organizations that offer expert opinions, cast ballots, and ban together with other investors. The Richmond, Va.-based company receives financial and other support from registered investment advisor TFS Capital LLC.
"There's been a tremendous surrender of power to institutional investors. It's up to individuals to say, 'Hey, enough is enough,'" says Mark Schlegel, CFA, Moxy Vote's co-founder and head of business development.
Moxy Vote, whose homepage includes a funny video about shareholder activism, has already helped average investors command attention in the boardroom. Last December, a group of On2 Technologies Inc. shareholders disappointed by Google's offer helped halt the proposed acquisition by voting over 12% of the video compression company's outstanding shares through MoxyVote. Google later sweetened its offer by about $25 million and won On2 shareholder approval.
"Individual investors aren't passionate about proxies but are passionate about issues. Tap into their passion for that one thing and they could be voting proxies for years to come," says Schlegel. Along the way, they'll see other responsible investing issues that may also pique their interest.
"We want a whole spectrum of opinions on our site. MoxyVote is a marketplace of ideas," says Schlegel. Nearly 40 advocates are already registered, including Green America, Calvert Investments, Green Century Capital Management, the Sierra Club, Oxfam America, Trillium Asset Management and Walden Asset Management.
"MoxyVote is a wonderful tool for individual investors who need some handholding during proxy season ... It lets them see how investors who do a lot of homework are voting," says Tim Smith, director of the Environment, Social and Governance Group for Walden Asset Management.
Although Walden votes its clients' proxies for them, "being an advocate with Moxy helps us reach out to the average individual investor...We can make sure the issues we think are important are highlighted," says Smith.
First Affirmative Financial Network LLC, an independent RIA that supports a nationwide network of investment professionals serving socially conscious investors, has referred individuals to MoxyVote. FAFN contracts with PROXY Governance Inc. to vote all proxies, according to FAFN proxy voting guidelines, for accounts where the client has provided authorization.
Although MoxyVote is the only Web site that enables investors to actually cast votes, other sites with proxy information that cater to responsible investors include ShareOwners.org, TransparentDemocracy.org, and ProxyDemocracy.org, notes Christie Renner, executive assistant to FAFN's CEO.