Ending the early tabulation of proxy votes and recounting for 975 companies (2020)

The weight carried by a single day at the deadline

The December disclosure described the tabulation of proxy voting cards, in the company’s own words, as “work that underpins the very foundation of corporate governance,” and then admitted that the impropriety of counting ahead of the deadline had never been recognized internally. What was left out was only the single day’s worth of ballots arriving on the closing date, and the numbers — about 3.4 million votes, 0.31% — are small. But the ballots cast right at the deadline are where the intent of shareholders voting against on contested resolutions tends to collect. That forty resolutions saw their approval rates fall by more than one percentage point on the recount shows something of it.

It would not be fair, though, to put this down to slackness at a single bank. The four companies that entrusted their tabulation to JaSt handled roughly 58% of all listed companies, and Mizuho Trust & Banking held a press conference the same day. Even after the Financial Services Agency raised governance as a problem in 2017 and the company shifted to a committee-based board, the practices rooted on the floor of the share-registry business were never caught in that net. Pay cuts and a switch to a post-office-box system put the form in order, but the underlying condition — an electronic voting rate of 19% — remained.