The Securities and Exchange Commission voted unanimously on Tuesday to propose permitting companies to issue proxy statements via the Internet, which would not only help shareholders access information more quickly, but allow them to do it more cheaply, according to the Reuters.
If approved, the proposal would also cut investment managers' costs of waging proxy contests and give shareholders the ability to challenge corporate managers.
Under this new rule, investors would receive a postcard in the mail, informing them that a proxy statement and annual report are now available online. Those investors who prefer to use the hard copy, could request one to be sent to them.
"Studies show that today, 75% of Americans have access to the Internet, and this percentage is rising steadily. The percentage of investors with Internet access is even higher," said SEC Chairman Christopher Cox.
If approved, the rule would go into effect in 2007, as per Alan Beller director of the SEC's corporation finance division.
But critics are concerned that the online proxy distribution will exclude off-line investors.