As a shareholder, one of your primary rights is the right to vote on important matters that can affect the company that you invest in. Shareholder voting is a proxy voting process that allows investors to share their views with a company’s leadership, thus helping to ensure the company’s business decisions and direction are in alignment with most of its shareholders.
Understanding Your Shareholder Voting Rights
There are two types of shareholders – common stock shareholders and preferred shares shareholders. Typically, only investors who own common stock are granted shareholder voting rights. Common stock owners are allowed one vote per one full share owned. So, if you own 2.5 shares in a company, you will have the right to cast two votes. In comparison, investors who own preferred stock in a company are not granted voting rights. Instead, they are given preferred treatment when it comes to receiving dividend payouts. It is important to note that your common stock shareholder voting rights can be impacted by your “Of Record” status. In most cases, to be eligible to vote, you need to be listed as an “Investor Of Record.” This status refers to the process in which investors are added to company records based on when they bought their shares, not how many shares they own. To be added to the company record and thereby be eligible to vote, an investor must purchase their shares prior to the ex-dividend date.
Shareholder Voting Rights: The Differences Between Privately Held and Publicly Traded Companies
Another factor that can determine your voting rights is whether the company you invest in is privately held or publicly traded. A privately held company can restrict its shareholder voting rights if it chooses to whereas a publicly traded company must adhere to the guidelines set by the Securities and Exchange Commission (SEC) as well as the rules (if any) that are specified by the exchange on which the company’s stock is listed for trading.
Shareholder Voting Lets Your Voice Be Heard
Investors can have a significant impact on a company’s direction when it comes to its leadership making important decisions on everything from its environmental initiatives to its cultural and societal choices, but only if they vote. Currently, only 10% of all investors take the time to vote by proxy. But Civex is changing that. Civex is an innovative app that allows investors to meet, discuss, and act, so they can have their voices heard on issues that matter with the companies they invest in. We make it easy for investors to put their shareholder voting rights into action and for companies to receive the feedback they need to make more informed decisions based on the wants of their shareholders. With Civex, you can stay informed about the topics that matter most to you and let your voice be heard.
