Statutory Voting

What is 'Statutory Voting'

Statutory voting is a corporate voting procedure in which each shareholder is entitled to one vote per share and votes must be divided evenly among the candidates or issues being voted on. Statutory voting, sometimes known as straight voting, is one of two stockholder voting procedures and the more common option. In statutory voting, if you owned 50 shares and were voting on six board positions, you could cast 50 votes for each board member, for a total of 300 votes. You could not cast 20 votes for each of five board members and 200 for the sixth.

BREAKING DOWN 'Statutory Voting'

The other voting procedure is cumulative voting, which lets shareholders weight their votes toward particular candidates and improves minority shareholders' chances of influencing voting outcomes. In cumulative voting, you are allowed to vote disproportionately, so if you own 50 shares and are voting on six board positions, you can cast 300 votes for one director and none for the five other directors, 20 votes for each of five board members and 200 for the sixth, or any number of other combinations. To find out whether a company uses statutory voting or cumulative voting, consult its stockholder agreement.

RELATED TERMS
  1. Cumulative Voting

    The procedure of voting for a company's directors; each shareholder ...
  2. Voting Right

    The right of a stockholder to vote on matters of corporate policy ...
  3. Voting Shares

    Shares that give the stockholder the right to vote on matters ...
  4. Voting Trust

    A legal trust created to combine the voting power of shareholders. ...
  5. Proxy Vote

    A ballot cast by one person on behalf of another. One of the ...
  6. Voting Trust Certificate

    A certificate issued by the limited-life trust of a corporation ...
Related Articles
  1. Managing Wealth

    Shareholders: Vote Your Proxy and Be Heard

    Voting shares, in person or via proxy ballot, is a right every shareholder should exercise. Here's why.
  2. Markets

    What Is Tenure Voting?

    This stockholder voting structure, one of three types, has advantages and disadvantages. Here’s a look at the pros and cons of all three.
  3. ETFs & Mutual Funds

    Proxy Voting Gives Fund Shareholders A Say

    You have the right to take part in important company decisions - even if you cannot attend the meetings.
  4. Markets

    How Your Vote Can Change Corporate Policy

    Shareholders are getting a bigger say in how companies are run. Find out how you can be heard.
  5. ETFs & Mutual Funds

    What Does Your Mutual Fund Say About You?

    How your fund votes on proxy issues will reveal whether it's acting in your best interest and according to your beliefs.
  6. Investing

    Keeping Control of Your Business After the IPO

    Taking a company public doesn't mean founders must completely give up calling the shots. Before the IPO, consider these tactics to keep control after it.
  7. Markets

    Britain Votes to Leave the European Union

    The British people have voted to leave the European Union.
  8. Insights

    How Zuckerberg Will Control Facebook Forever (FB, GOOG)

    Zuckerberg has pledged his wealth for charity, which includes his Facebook stock ownership. Here's how he will still control the Facebook business forever.
  9. Markets

    Brexit: What You Need To Know

    A summary of what you need to know over the next 24-48 hours during the Brexit vote
  10. Investing

    Will a Brexit Lead to Grexit?

    Reports suggest that a Brexit could accelerate the possibility a Grexit will occur as early as this summer.
RELATED FAQS
  1. If I own a stock in a company, do I get a say in the company's operations?

    You don't get a direct say in a company's day-to-day operations, but, depending on whether you own voting or non-voting stock, ... Read Answer >>
  2. What can shareholders vote on?

    Understand the usual voting rights of common stock shareholders, along with the importance of shareholders exercising their ... Read Answer >>
  3. What happens to the voting rights on shares when the shares are used in a short sale ...

    The registered owner of the security, known as the holder of record, is the investor who retains voting rights. This means ... Read Answer >>
  4. Do convertible bonds have voting rights?

    Convertible bonds usually have no voting rights until they are converted. Even after conversion, they may not be granted ... Read Answer >>
  5. Why would a company have multiple share classes, and what are super voting shares?

    Firstly, do not confuse different classes of common stock with preferred stock. Preferred shares are an entirely different ... Read Answer >>
  6. What is the difference between Class A shares and other common shares of company's ...

    Discover how a company can break down its common stock into multiple classes and how these classes differ from one another ... Read Answer >>
Hot Definitions
  1. Dove

    An economic policy advisor who promotes monetary policies that involve the maintenance of low interest rates, believing that ...
  2. Cyclical Stock

    An equity security whose price is affected by ups and downs in the overall economy. Cyclical stocks typically relate to companies ...
  3. Front Running

    The unethical practice of a broker trading an equity based on information from the analyst department before his or her clients ...
  4. After-Hours Trading - AHT

    Trading after regular trading hours on the major exchanges. The increasing popularity of electronic communication networks ...
  5. Omnibus Account

    An account between two futures merchants (brokers). It involves the transaction of individual accounts which are combined ...
  6. Weighted Average Life - WAL

    The average number of years for which each dollar of unpaid principal on a loan or mortgage remains outstanding. Once calculated, ...
Trading Center