Israeli-based eToro announced its partnership with New York-headquartered Broadridge Financial Solutions (NYSE: BR) on Tuesday for allowing proxy voting for the retail broker’s users. eToro will collect all investor votes and aggregate them before sharing them with the companies.
The partnership will allow eToro users holding company shares, including fractional shareholders, to participate in annual general meetings (AGMs) by casting proxy votes. They can vote on corporate decisions like mergers, executive pay, environmental decisions as well as social and governance proposals.
The broker will first enable proxy voting for the US-listed stocks and then it will extend the feature for shares listed on other global exchanges.
“In the last few years, we’ve seen an explosion in the number of retail investors. This group has the potential to have a major influence on financial markets,” eToro’s Co-Founder and CEO, Yoni Assia, said.
“Thanks to our partnership with Broadridge, eToro’s users can now have their say in corporate decision-making at many of the biggest companies in the world. This is a huge milestone in the retail investor story, and one that could have a lasting impact on the business world.”
The new feature was enabled weeks after eToro acquired Bullsheet, a provider of portfolio management tools exclusively to eToro users, which will further enhance its user experience.
A New Breed of Investors
Additionally, the rising number of retail brokers prompted the broker to enable the proxy voting feature. A broker survey among 10,000 retail investors concluded that 73 percent want to participate in AGM voting. Further, young investors are more inclined to participate in such decision-making activities compared to older ones.
In addition, the survey found that most retail investors are interested in deciding on dividends, followed by executive pay and climate strategies.
“Retail investors have not always been given the platform, the voice, and the support that they deserve, but this is rapidly changing, and retail investor access to proxy voting is a crucial step in this journey. There is clearly a huge appetite amongst retail investors to participate in AGMs, and we look forward to seeing how eToro clients engage with this new feature,” Assia added.
Broadridge is a financial infrastructure provider with clients including banks, broker-dealers, asset and wealth managers and public companies. Last year, it expanded its market reach by acquiring the trading connectivity and technology provider , Itiviti for $2.5 billion.
On top of that, the New York-headquartered company expanded its geographical reach by expanding offerings for custodians and local agents in Switzerland last year in October. Meanwhile, the company’s revenue for the fourth quarter of the financial year 2022 climbed 12 percent to touch $1.7 billion, along with an operating income of $342 million.
Commenting on the eToro partnership, Broadridge’s President of Bank Broker-Dealer Investor Communication Solutions, said: “We are excited to be supporting eToro and helping them shape the future of corporate governance through our advanced proxy voting solution while empowering their clients through a differentiated service proposition.”
