Integrating Proxy Voting Into The 'Ownership Investing' Paradigm: From Research Findings To An Action Plan

“What are the implications of the investment theory/practice evolution being fostered by people like Ambachtsheer, Kay, Penrose, Madden, and TenHaken? It should surely lead to decisions to emphasize ownership-focused long-term value-creation strategies over short-term ‘beauty contest’ trading gains.”

The Ambachtsheer Letter, April 2025

 “Proxy voting is often done in the context of shareholder meetings to facilitate decision-making when   investors cannot be present at a given meeting. Shareholders might receive proxy materials by mail or email with explanations and voting instructions. Often, these votes concern board elections, mergers and acquisitions, corporate social responsibility, and are an important aspect of corporate governance.”

Investopedia

 “The proxy voting system is a vital part of the corporate value chain as it provides a necessary tool for shareholders and issuers to engage on key issues in corporate governance. However, this vital role has been undermined by the tendency for market participants to blame each other for its shortcomings, rather than look for mutually beneficial solutions.”

“Voting for Value: Reforming Proxy Systems for Lasting Impact”FCLTGlobal—Focussing Capital on the Long Term, 2025

The ‘Ownership Investing’ Paradigm

Regular readers of this publication will know that ‘ownership investing’ has been a recurring theme in recent issues. The theme follows logically from Peter Drucker’s 1976 book “The Unseen Revolution” where he visualized workers becoming owners of the means of production not through violent revolution, but through their pension funds. The April 2025 Letter titled “Rethinking Pension Fund Investing: The Journey Continues” asserted that Drucker’s now 50 year-old vision is slowly becoming reality. As evidence, it  pointed to Sir John Kay’s new book “The Corporation In The 21st Century”, which advocates replacing old business models based on agency theory and rules, with new ones encompassing co-operation, win-win outcomes, and long-horizon value creation.