Proxy Voting Made Easy

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It's not only the Internet but a series of anticipated regulatory changes that hold promise for the enhanced importance of individual shareholders when it comes to corporate voting actions, says Minow. An upcoming proxy access rule, announced in June 2009 by the U.S. Securities & Exchange Commission, would enable shareholders to nominate an alternate slate of directors essentially at a company's expense by forcing the company to post the alternate nominees' names on the same proxy cards the company sends to all shareholders. Until now, it has been prohibitively expensive for activist shareholders to run an opposing slate of board candidates, says Minow.

"This will make it possible for shareholders to challenge corporate directors in a meaningful way. When that happens, each vote becomes much, much more valuable, more complicated, and more in need of the guidance that Moxy Vote will try to give," she says. "This is getting corporate America where they live." So much so that the U.S. Chamber of Commerce has already said it will sue to challenge the rule once it comes out, she adds.

Eric Cohen, chairman of Boston-based Investors Against Genocide, one of the 21 advocates on Moxy Vote, sees the Web site as a necessary corrective to some of the factors that stack the deck against shareholder proposals. Among these factors is an SEC rule that requires a clear and fair statement of a shareholder resolution on a ballot except where shares are "being held in Street name" by a broker. Cohen says he was shocked to find that when Broadridge, the firm most brokers use to communicate to shareholders, sent out voting instructions to American Funds investors last year, it didn't include a single word of the sentence Cohen's group had drawn up to describe its resolution calling for American Funds not to invest in companies the group considered to be complicit in genocide.

Mutual Fund Use

Minow also thinks Moxy Vote could be useful in forcing mutual funds to vote more in line with individual shareholders' interests. "I'd like to see not just individual investors voting through Moxy Vote but looking at what the votes are and going back to their mutual funds and saying, 'I'd like to know why you're not voting this way,' " such as concerning funds' widespread approval of executive pay packages without regard for performance.

While Moxy Vote no longer has a role in the On2/Google deal, Marcoux says he and a couple of like-minded partners intend to band together to become an advocate on the Web site. He sees the platform as revolutionary in that it has the potential to allow individual investors to unite their voices against abusive practices by corporate executives that ignore shareholders' interests.

"It's very difficult for shareholders to have a voice in this big corporate process," he says. "Moxy Vote will be a place where individuals can come together and make their opinion heard."

Bogoslaw is a reporter for Bloomberg BusinessWeek's Finance channel.

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