Allen attributes two issues to the lack of involvement: voting by show of hands and the dominance of major shareholders. The presence of a large number of family-controlled companies in Asia appears to have quashed any interest in pushing shareholders’ views at shareholder meetings.
But this reluctance could be based on a misconception. As Manifest’s Asian proxy research shows, where there is a major transaction on the agenda, the major shareholder is barred from voting. As Allen says: “funds are giving away the opportunity to influence the outcome.” This could mean that a quoted company being taken private at a significant discount to the market value.
The list of barriers to voting in Asia will sound familiar to anyone who has been voting across borders in continental Europe:
- late agendas;
- agendas unclear or bundled resolutions;
- insufficient information to make an informed judgement;
- no vote lodgement confirmation;
- absence of voting results; and
- voting by show of hands rather than by poll.