The SEC recently informed service providers in the proxy distribution industry of a new interpretive position regarding the use of voting buttons. According to the new SEC staff position, service providers must present shareholders with a "Vote Against the Board's Recommendations" button if they provide a "Vote with the Board's Recommendations" button. This position applies to the solicitation of proxies or voting instructions both online and over the telephone.
The new interpretation presents technical challenges with respect to certain votes, such as the say-on-pay frequency vote required by Dodd-Frank, where it is unclear how a "Vote Against the Board's Recommendations" button would be applied. Because of these complications, Broadridge, a leading investor communications company, recently informed its customers that the presentation of a "Vote Against the Board's Recommendations" option is not currently feasible. Consequently, shareholders will be required to vote on each item and will be informed of the board of director's recommendation with respect to each item. Broadridge has disclosed that it will implement changes to its online, mobile and telephone platforms before the spring 2013 proxy season.