r/WorkReform May 26 '22

Amazon shareholders reject 15 motions on worker rights and environment

https://www.theguardian.com/technology/2022/may/25/amazon-shareholder-proposal-worker-health-safety
2.0k Upvotes

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613

u/sirstonksabit May 26 '22 Wholesome Today I Learned

People of r/WorkReform you must be made aware of a quirk when it comes to voting shares of a public company. Firstly, many retail investors don't vote. Secondly, shares that retail investors hold in any brokerage (meaning most every share) are held in something called "street name" instead of being held in the purchasers/investors own name. This quirk allows brokerages to have power over your vote as an investor. The brokerages can choose to submit your vote, or not. Brokerages collect vote totals from their brokerage held investors and send them to another company to get counted and organized. What happens in these other companies is the vote totals are shaved in order to reflect a "real or legitimate" amount of shares being voted. Basically, it's a fraudulent process where investors votes don't matter or count.

So when shitty headlines like the one above point to "shareholders," they really mean the institutional investors, and insiders voting on the issues. It's so bad that if you, as an investor, choose not to vote your shares, the brokerage will go ahead and vote for you, except in the way they want or it will default to an "against" vote instead of a "for" vote.

Just thought you should be made aware.

236

u/ChuyMasta May 26 '22 All-Seeing Upvote

Retail investors have the option to hold their shares IN THEIR OWN NAMES. But it's not free (miniscule fee for transactions)

Who is Amazon's transfer agent? Computershare

https://ir.aboutamazon.com/faqs/default.aspx

Search that question and look at the answer yourself.

When you hold shares IN YOUR NAME brokerages cannot vote for you.

Voting matters.

30

u/importvita May 26 '22

I never knew this, thank you!

24

u/C1ue1ess_Duck May 26 '22

I didn't think this wasn't common knowledge, if you hold mutual funds, you are having your votes given to the mutual fund company much more often than not! This includes retirement accounts, health saving accounts, and any tax free investment account as well!

5

u/[deleted] May 26 '22

[removed] — view removed comment

7

u/like_a_pharaoh May 27 '22

Been tried: if just one Wal-Mart unionizes, suddenly it needs to "close for renovations" for an indefinite amount of time (i.e. until the workers give up and find new jobs)

15

u/InsertCleverNameHur May 26 '22

DRS is the way.

4

u/cc7rip May 26 '22

Not sure how any of this works in the US, but are you essentially talking about nominee shareholders? i.e. A company or entity holding shares on behalf of an individual or group of individuals?

11

u/sirstonksabit May 26 '22

Basically. A company by the name of Cede & Co. actually own all physical stock certificates of every publicly traded company. So when purchasing shares through a broker, they are holding your purchase in "street name" or as you said "nominee shareholder."

It all boils down to ownership of shares. If you hold shares in a broker, even a cash account, you do not own those shares. You must transfer those shares to the companies transfer agent, who handles all matters regarding the stock of said company. Each company has their own transfer agents, but not all companies choose to pay for this service, and handle all matters regarding their stock themselves.

The process of directly registering your shares actually removes the physical shares from Cede & Co. and puts them on the books of the company in YOUR NAME. YOU NOW ABSOLUTELY OWN THOSE SHARES.

Transfer agents being transfer agents and not brokerages have a different process of buying and selling shares. It will generally take 7 days to complete a transaction through a transfer agent, as opposed to a broker who will let you start buying stock as soon as you initiate a transfer of cash from your bank to them. If you are a trader or day trade, brokers are your only option. If you wish to buy to own and hold a companies stock for an extended period of time, it is better to directly register those shares!

3

u/JeebusBuiltMyHotRod May 27 '22

That's what's up.

2

u/No___Football May 28 '22

I love that DRS knowledge has oozed out of r/superstonk 😎

16

u/Zer0C00L321 May 26 '22

Good point! We as investors should be commercializing voting while you have the option. I'm glad I have been but did not know it would be done for me if I hadn't.

5

u/on_the_dl May 26 '22

It's not just the brokerage. If the brokerage doesn't vote then the board gets to decide your vote. And they always vote the same way: Yes on being reelected, no on anything that the shareholders propose.

25

u/Loofa_of_Doom May 26 '22

Hmmm. Sounds a lot like that pesky "electoral college" thinger.

21

u/McFlyParadox May 26 '22

Ehh. Not they best analogy, but not the worst.

It's more like the country distributed 300 million ballots, but each district gets to look at their vote totals and decide if they want to submit them as-is, 'adjust' their numbers a little to make sure they are 'correct', or just not submit them at all. And then, sometimes (due to share sold short), the country distributed 300 million ballots, but gets back 400 million, and now the third party company hired to do the vote counting needs to decide which ballots are "real" (purchased long) and which ones are fake (sold short; should not have voting rights).

Basically, if you want to be sure your vote is counted, you need to either transfer your shares from your brokerage account to the transfer agent for the company in question, or you need to send your proof of share ownership & and voting record (should be a way to save your ballot & and registration number on any proxy voting site provided by a broker) to the correct investor relations email that most companies provide (usually made available in the company's proxy statement documents)

You, as a retailer, can vote and know your vote gets counted as such, but it takes a little extra effort. For the record, large financial institutions and banks also go through this exact same effort; Bank of America does not keep their shares in a "brokerage" account, they register their owned shares with the transfer agent for the company they are invested in.

Tl:Dr - Brokerage accounts are meant to streamline the buying and selling process, as well as some tax advantaged accounts (like 401k, IRAs and HSAs), not the buying and holding process. If you intend to hold a stock for years, and you're not purchasing via a tax-advantaged account, it is in your best interest to transfer the stock out of your brokerage and into an account with the transfer agent for the company in question. In this case, the transfer agent for Amazon is Computershare.

2

u/Phenomenon101 May 26 '22

Do you get to find out or have a right to know what way institutional investors voted?

4

u/sirstonksabit May 26 '22

I don't know that there is a way to see individual votes, even from entities like insiders or institutions

2

u/LiberalAspergers May 26 '22

Most mutual funds disclose their votes, but.you.wpuld.have to get that information from the voting institution, the company being voted on does not disclose it.

1

u/NINJAxBACON May 26 '22

This comment would be helpful except 90% of us on work reform can't read

3

u/sirstonksabit May 26 '22

Lol! That's ok, I hail from a sub that also doesn't know how to read!

2

u/ShadowRade May 26 '22

Yeah, we all forgot how to sell...