ProxyDemocracy

Time to big up the rather marvellous ProxyDemocracy.org. This is a great initiative that is really trying to get under skin of how the agents we appoint to manage our money exercise voting rights. If you search for a particular fund you can see how it votes on different types of resolutions. They also get an activism score.

It's the latest example of online resources aimed at giving punters some info about how fund managers handle corporate governance issues. Another one that I've plugged before but which is worth a look is FundVotes.com.

The obvious drawback is that these are US sites, focusing on votes at US companies. We had a go at doing something similar for the UK market at the TUC while I was there - have a look at this. Unfortunately there simply isn't enough voting data in the public domain in the UK to do something directly comparable to ProxyDemocracy. That's why I still think we need mandatory disclosure, rather than the patchy voluntarist system we have now (and fund managers had to be dragged kicking and screaming to get this far).

Whilst I'm on my hobby horse about voting disclosure, some managers argue, with a bit of validity, that just looking at their votes doesn't tell the whole story - that their engagement with companies is more important. There is merit in this argument but there are a load of other points to be made in return.

1) trustees should at least be aware of how their managers value voting vs engagement, yet managers don't make this explicit (whereas disclosing voting would start to get there)

2) it's not clear that many fund managers record engagement activity so what can they actually report? At least voting has data.

3) what does engagement activity prove? does the fact that you met with a company before waving through a questionable remuneration package make that decision any better?

4) if you are a geek like me and look closely at voting data it is easy to see trends amongst managers. I would suggest that those who vote with management almost without fail probably aren't much trouble on engagement either. Again trustees, and other potential clients, should at least have access to this type of info.