The Corporate Library Examines Fund Voting in 2006

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The Corporate Library has published the most extensive analysis of 2006 mutual fund voting data to date. The report represents the complete analysis of the 2006 voting records of 29 large mutual fund families. Included in the dataset are the voting records of 702 funds, amounting to more than 1.2 million voting decisions.

The Corporate Library has published the most extensive analysis of 2006 mutual fund voting data to date. The report represents the complete analysis of the 2006 voting records of 29 large mutual fund families. Included in the dataset are the voting records of 702 funds, amounting to more than 1.2 million voting decisions.

Some of the highlights of the study:

  •     Funds supported 92% of management-sponsored proposals in 2006 on average, up from 89% in 2004. A small number of management resolutions propose reforms that shareholders have called for in the past, yet receive much higher support when proposed by management. For example: Dreyfus, which voted in favor of no shareholder resolutions to declassify the board in 2006, voted for 98% of management proposals to adopt the same reform.
  •     Putnam was the fund family least likely to support management-sponsored resolutions, with an average 79% support. American and Ameriprise had the highest levels of support for management resolutions, with average support of 97%.
  •     Funds voted in favor of 37% of shareholder-sponsored resolutions, on average. Governance-related resolutions, which comprised 76% of all shareholder-sponsored resolutions published in proxies in 2006, received 44% support from funds. This figure has increased over the three years spanned by this study for 14 of the largest fund families, from 37% in 2004.
  •     Among shareholder resolutions, those proposing board declassification received the highest level of fund support - 87.7%, on average - in the 2006 proxy season. The largest category of shareholder resolution, those urging majority affirmative support for uncontested director elections, achieved 60% support from funds, on average, up significantly over the past three years.

The study considers voting behavior on a number of categories of resolutions, including management- versus shareholder-sponsored resolutions, fund voting on management nominees to boards, and fund voting broken down into a number of categories of corporate governance-related, shareholder-sponsored resolutions. It compares 2006 voting data with that of 2004 and 2005, as reported in a previous study prepared by The Corporate Library research staff.

The complete report is available in The Corporate Library's online store at http://www.thecorporatelibrary.com.

About The Corporate Library

The Corporate Library LLC, headquartered in Portland, Maine, is the leading independent resource for corporate governance and compensation information and analysis of public U.S. corporations. Founded in 1999, it continues to be the authority on corporate governance matters, as evidenced by the frequency with which key media, business and government leaders seek its unique insight and objective perspectives. Information on The Corporate Library and its suite of online corporate governance products and services can be found on its website at http://www.thecorporatelibrary.com.

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MELANIE BOND