A longstanding point of contention for UK retail investors has been the passivity of financial services providers and regulators in regard to the erosion of key shareholder rights. Pooled nominee accounts are now the standard way to hold shares, and they bring significant benefits. But with the removal of their names from company registers, shareholders are no longer guaranteed to receive information from companies, invites to AGMs or notifications to vote, and they cannot requisition special meetings when things go wrong at a company.
Progress has been made with the restoration of voting rights on some platforms, but now a new drive to modernise the shareholding industry risks dragging the cause of shareholder rights backwards, and triggering an asset grab from less active investors.
As part of the government’s big plan to re-energise the City, a taskforce led by Abrdn chair Sir Douglas Flint was set up to achieve full digitisation of sharedealing, doing away with paper as an option. It’s an idea that makes complete sense, and when the taskforce began work, there was broad agreement that this was a job that was long overdue.