Some shareholders of some funds have it easier when finding out information on where their mutual funds stand on corporate issues, according to the Wall Street Journal.
Almost four years ago, the Securities and Exchange Commission started requiring funds to disclose their policies guiding how they vote shares of the companies they invest in. However, a review of dozens of funds’ guidelines for so-called proxy voting shows wide differences in how much information the funds disclose.
Some mutual funds divulge summaries on how they support or oppose specific ballot topics, while others fail to state where they stand on a single corporate-governance proposal.
For mutual fund investors this is important given that a fund’s shareholders are indirect owners of the stocks in that fund and may have an opinion about how those shares should be voted.
More investors are paying attention to proxy voting and some firms, after hearing from their clients that they want more information are providing significantly more details.
The SEC requires the guidelines to be published only in a relatively obscure regulatory filing called the Statement of Additional Information. The SAI isn’t automatically sent to shareholders. Many funds now have links to their SAIs on their websites. Otherwise investors have to go to the SEC’s database to locate one.
“This is an area that has not received the kind of detailed attention by mutual fund boards that they will pay in the future,” says David Ruder, former SEC chairman and current chairman of the Mutual Fund Directors Forum, a membership organization for fund directors.
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