Why I've Become a Shareholder Who Doesn't Vote

If you own individual stocks, chances are you’ve started to get reminders to vote at annual meetings. On a typical day at this time of year, about 60 different companies file proxy statements inviting investors to participate. The invites that I receive from E-Trade, the firm that I use for the handful of individual stocks that I own, remind me in big letters that “Your Vote Counts!”

That’s a nice sentiment, but it’s not exactly the truth. Unlike in other elections — from the local school board to the President of the United States — your vote in a company’s election might not matter at all. That’s true whether the proposal is coming from the company — voting for directors, for example — or from outside shareholders pushing for changes in compensation or environmental policies.