Institutional investors are responsible to their customers, mostly members of pension funds and underwriters of mutual funds, both for their investment choices and for defending the value of the investment over time.
Regulatory developments push towards an increasingly active participation of institutional investors in corporate life, and their high diversification of investments represents a significant obstacle to the correct and conscious exercise of voting rights.
Frontis Governance offers the most efficient and effective solution for the analysis and management of all issues related to shareholders’ vote. An independent, expert and international guide to go through the complex voting process and consciously and easily exercise shareholder rights.
Constant monitoring of the governance of investee companies;
Information: prompt notification of General Meetings transmission of meeting material;
Analysis of proposed resolutions;
Voting recommendations based on best market practices and specific corporate governance principles adopted by the institutional investor (customized recommendations);
Proxy voting: support in the correct submission of the proxy vote and representation of the shareholder at Italian meetings.
The Frontis Governance approach
Active share ownership, which mainly takes the form of exercising the right to vote, represents a basic tool available to investors to monitor the governance practices of the companies in which they invest and protect shareholders’ rights. In this sense, Frontis Governance aims to promote and encourage the active participation of investors in the meetings of all investee companies, through the analysis and support for the exercise of the vote both in Italy and abroad, thanks to the partnership with Proxinvest.
The application of the rules and self-regulatory codes in force from time to time is the basic element of good governance, which, however, cannot be limited to a mere exercise of compliance. Likewise, proxy advisors should not base their analysis on a strict application of rigid and immutable principles. Market best practices and investors’ guidelines should always be adapted to the characteristics of each issuer, their reference sector and market. In this sense, Frontis Governance analyses are always carried out on a case-by-case basis.
Frontis Governance considers that an ongoing dialogue between proxy advisors and issuers is of fundamental importance, it may improve mutual understanding of corporate governance principles and helps in better defining market best practices. Nonetheless, such discussion has to be stopped as soon as the notice of meeting is published, in order to not create bias in the analysis and preserve the maximum independence of the analysts. The primary objective of proxy advisors’ research is helping investors in correctly exercising their voting rights. Therefore, the analysis of the agenda is not shared with the issuers until the day following its distribution to Frontis Governance clients.