Proxy Voting

Registered investment companies—including mutual funds, closed-end funds, and ETFs—have dual roles as investors in securities of public companies and as issuers of securities with their own shareholders and boards of directors.

As investors in corporations, funds are entitled to vote on proxy proposals put forth by a company’s management or its shareholders. As part of its fiduciary duty to a fund, the fund’s board of directors, acting on behalf of the fund, is responsible for the voting of proxies relating to the fund’s portfolio securities. A fund’s board typically (but not always) delegates proxy voting responsibilities to the fund’s investment adviser but maintains oversight of this function.

As issuers of securities, funds periodically have their own shareholder meetings. In general, open-end funds do not hold annual shareholder meetings; rather, a meeting is held when a shareholder vote on a particular matter is required, such as the election of fund directors or approval of an acquisition or merger. Closed-end funds are required to hold annual shareholder meetings by the rules of the exchange on which the fund’s shares trade.

ICI and IDC Publications

Included below are links to proxy-related policy materials from the past several years. It is not meant to be exhaustive.

SEC Proposals

• Substantial Implementation, Duplication, and Resubmission of Shareholder Proposals Under Exchange Act Rule 14a-8 (Jul 13, 2022)

SEC Final Releases

• Proxy Voting Advice (July 13, 2022)
• Universal Proxy (Nov 17, 2021)
• Procedural Requirements and Resubmission Thresholds under Exchange Act Rule 14a-8 (Sep 23, 2020)
• Commission Guidance Regarding Proxy Voting Responsibilities of Investment Advisers (Aug 21, 2019)
• Commission Interpretation and Guidance Regarding the Applicability of the Proxy Rules to Proxy Voting Advice (Aug 21, 2019)
• Commission Interpretation Regarding Standard of Conduct for Investment Advisers (Jun 5, 2019)
• Concept Release on the US Proxy System (Jul 14, 2010)
• Compliance Programs of Investment Companies and Investment Advisers (Dec 17, 2003)
• Disclosure of Proxy Voting Policies and Proxy Voting Records by Registered Management Investment Companies (Jan 31, 2003)
• Proxy Voting by Investment Advisers, SEC Release No. IA-2106 (Jan 31, 2003)

SEC-Related Statements and Other Materials

• Shareholder Proposals: Staff Legal Bulletin No. 14L (CF) (Nov 3, 2021)
• Statement Regarding Staff Proxy Advisory Letters (Sep 13, 2018)
• Proxy Voting Responsibilities of Investment Advisers and Availability of Exemptions from the Proxy Rules for Proxy Advisory Firms, Staff Legal Bulletin No. 20 (IM/CF) (Jun 30, 2014)

DOL Final Release

• Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights (Nov 22, 2022)

US Government Accountability Office Reports

• Issues Relating to Firms That Advise Institutional Investors on Proxy Voting, GAO-07-765 (Jun 29, 2017)
• Proxy Advisory Firms’ Role in Voting and Corporate Governance Practices, GAO-17-47 (Nov 15, 2016)