Proxy

AAA

DEFINITION of 'Proxy'

1. An agent legally authorized to act on behalf of another party. Shareholders not attending a company's annual meeting may choose to vote their shares by proxy by allowing someone else to cast votes on their behalf.

2. A formal power of attorney document that may be signed by a shareholder to authorize another shareholder, a representative of the shareholder or the company's management, to vote on behalf of the shareholder at the annual meeting. Proxy statements must be filed with regulatory authorities (the Securities and Exchange Commission in the U.S.) on an annual basis prior to the company's annual meeting. Proxy documents are meant to provide shareholders with the information necessary to make informed votes on issues important to the company's performance. A proxy is known to offer shareholders and prospective investors tremendous insight into a company's governance as well as a glance at the way that a company's management operates.

INVESTOPEDIA EXPLAINS 'Proxy'

1. Management often encourages shareholders to vote by proxy so that ownership interests are fully represented even if shareholders are unable to attend the company's annual meetings in person.

2. The proxy discloses important information about issues to be discussed at an annual meeting, lists the qualifications of management and board members, serves as a ballot for elections to the board of directors, lists the largest shareholders of a company's stock and provides detailed information about executive compensation.

RELATED TERMS
  1. Shareholder

    Any person, company or other institution that owns at least one ...
  2. E-Meeting

    A meeting that takes place over an electronic medium rather than ...
  3. SEC Form DEFM14C

    A filing with the Securities and Exchange Commission (SEC) that ...
  4. SEC Form DEFS14C

    A now-obsolete filing with the Securities and Exchange Commission ...
  5. Proxy Directive

    A legal document assigning the health-care decisions of an individual ...
  6. SEC Form CB

    A filing with the Securities and Exchange Commission (SEC) required ...
Related Articles
  1. Active Management: Is It Working For ...
    Mutual Funds & ETFs

    Active Management: Is It Working For ...

  2. What Does Your Mutual Fund Say About ...
    Mutual Funds & ETFs

    What Does Your Mutual Fund Say About ...

  3. A Guide To CEO Compensation
    Options & Futures

    A Guide To CEO Compensation

  4. Proxy Voting Gives Fund Shareholders ...
    Mutual Funds & ETFs

    Proxy Voting Gives Fund Shareholders ...

Hot Definitions
  1. Debit Spread

    Two options with different market prices that an investor trades on the same underlying security. The higher priced option ...
  2. Leading Indicator

    A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators ...
  3. Wage-Price Spiral

    A macroeconomic theory to explain the cause-and-effect relationship between rising wages and rising prices, or inflation. ...
  4. Accelerated Depreciation

    Any method of depreciation used for accounting or income tax purposes that allows greater deductions in the earlier years ...
  5. Call Risk

    The risk, faced by a holder of a callable bond, that a bond issuer will take advantage of the callable bond feature and redeem ...
  6. Parity Price

    When the price of an asset is directly linked to another price. Examples of parity price are: 1. Convertibles - the price ...
Trading Center