Many people believe that if you don't like the system, you should vote to change it. This also applies to a company in which you hold stock. Read on to find out how owning shares can give shareholders a voice and how they are speaking up.

Taking Stock of a Company
Making your voice heard as a shareholder is no short-term affair. You can't swoop in and buy a stock a week before the vote, make some noise about policy, and then sell your shares a week later. The U.S. Securities and Exchange Commission (SEC) states you must hold at least $2,000 in stock, or 1% of the outstanding shares, for a minimum of one year before the company's annual submission deadline before you can introduce a shareholder resolution for a proxy vote.

You must also follow specific SEC guidelines when you file a resolution. The resolution cannot exceed 500 words and it must conform to exact procedural and content requirements. Finally, the resolution must be filed by the deadline stated in the company's annual proxy statement - at least 120 days before the statement is released.

If your resolution is accepted, you or a representative will be required to participate in the shareholder meeting; if you miss the meeting without a valid cause, your proposal can be excluded by the company. The company has the option to exclude the resolution but is required to file its reasoning with the SEC no later than 80 calendar days prior to it submitting its proxy statement to the SEC.

Most shareholder resolutions won't win a majority of votes, but you can grab the attention of other shareholders, the board of directors (B of D) and the management. If you receive 3% of votes, you can resubmit your proposal the following year. You must win 6% of votes the second year and 10% every following year to continue submitting your resolution.

Even when a resolution wins a majority, the company is not obligated to make a change. The company may even ignore a successful resolution. That said, companies have grown more responsive to shareholder resolutions because investors have learned to make a strong business case about the issues they present, and corporations recognize the danger of community backlash when bad press leaks out about corporate policy.

Shareholders, Boards and Management     
As a shareholder, you own part of the company in which you bought stock; in other words, you've provided the capital for the company to run its business. Shareholders elect the board of directors, which manages the corporation and makes business decisions. The directors choose the management, which handle the daily operations of the corporation. The board and the management should be working on your behalf.

A board of directors at a large public company, however, can often maneuver control of the vote. When institutional shareholders grant proxies to the board to vote their shares, the board can represent an overpowering voting bloc. (For related reading, see Proxy Voting Gives Fund Shareholders A Say.)