• November 2019
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Proxy

1. A legally authorized agent charged with acting on behalf of another party (e.g., voting on behalf of a shareholder at an annual meeting). Proxy can also refer to a format that substitutes for in-person action (such as voting by mail).

Acting as someone’s proxy is no casual affair, particularly in the context of shareholder voting. Depending on the rules set forth by the governing body, voting may require the proxy to have a written power of attorney document issued by the shareholder he is filling in for. Even if power of attorney is not required, the shareholder will at least need to draft documentation specifying what the proxy is allowed to do or decide on his behalf.

Whether proxy voting is done by a stand-in or by mail/phone/internet, shareholders need early access to the information they’ll use to cast votes on or before the day of the meeting. To facilitate this, company boards will issue what are called “proxy statements.” This is a packet of documents containing information on just about everything one would need to know about the performance of the business, the current and prospective board members, stock data, executive compensation and more. The Securities and Exchange Commission requires companies to file proxy Statements with the regulatory authorities each year, prior to the annual meeting.

2. Sitcom ethics: Someone you designate to pose as you during a blind date, jury duty, or important test you failed to study for. For full effect, the proxy must make at least a modest effort to imitate your look, style or speech patterns.

 

 

EXAMPLE:

John is a significant shareholder at a major company. He normally attends the annual meeting in person, but this year, he has non-transferrable tickets to see “Hamilton” on Broadway, and he’s not going to miss it in order to be in the room where it (voting) happens. Instead, he designates power of attorney to a trusted friend who will attend the meeting and vote as his proxy.