eToro has partnered with Broadridge Financial Solutions Inc. to enable proxy voting for its users, including those holding fractional shares through the social investing network.
The proxy voting functionality allows users to participate in annual general meetings (AGMs) by casting a proxy vote on issues such as mergers, executive pay and environmental, social and governance proposals. Votes are submitted by eToro investors, aggregated, and shared with the company.
Proxy voting for stocks listed on US exchanges will go live on the eToro platform later this month followed by voting for stocks listed on other global exchanges. In the coming months, eToro users will also be able to participate in voluntary corporate actions.
“Huge milestone in the retail investor story”
Yoni Assia, CEO and co-founder of eToro, said: “In the last few years we’ve seen an explosion in the number of retail investors. This group has the potential to have a major influence on financial markets. Thanks to our partnership with Broadridge, eToro’s users can now have their say in the corporate decision making at many of the biggest companies in the world. This is a huge milestone in the retail investor story and one that could have a lasting impact on the business world.
“Retail investors have not always been given the platform, the voice and the support that they deserve but this is rapidly changing and retail investor access to proxy voting is a crucial step in this journey. There is clearly a huge appetite amongst retail investors to participate in AGMs and we look forward to seeing how eToro clients engage with this new feature.”
Martin Koopman, President, Bank Broker-Dealer Investor Communication Solutions at Broadridge, said: “The substantial growth of retail investors has driven a step change in demand for greater shareholder engagement, with retail investors increasingly seeking to share their voice with the companies in their portfolios by voting on important issues relating to corporate policy. We are excited to be supporting eToro and helping them shape the future of corporate governance through our advanced proxy voting solution, while empowering their clients through a differentiated service proposition.”
An eToro survey of 10,000 global retail investors found that three in four (73%) wish to vote in AGMs, with younger investors significantly more likely than older investors to want a say, with 80% of 18-34-year-olds saying they would vote at AGMs if given the chance vs 65% of over 55s.
Those who have been investing for 3-5 years were most likely to vote (79%), with investors with over 20 years’ experience least likely to vote (65%). As to corporate issues, dividends have the most demand for voting (49%), followed by executive pay (33%) and climate strategy (28%).
eToro users said their preferred method of participation in AGMs would be via a website. Voting by post was the least popular option.