Almost all comment letters on the concept release so far have favored significant changes to various aspects of the current proxy system. But not this one. Glenn Greenberg, on behalf of the clients of Brave Warrior Advisors, a long-only asset management firm with $1.1 billion invested in U.S. equities, writes: "I want to deliver a clear message: the current system works! Don't try to 'fix' it."
The letter's principal focus of concern, however, is preserving the anonymity of shareholders and the privacy of investment strategies. The letter states:
"Our clients (and the financial system) benefit when we are able to make our investments largely in private; were our decisions to be made public more frequently than the required quarterly Form 13-F filings, copycats might emulate our positions, mitigating our ability to buy in scale at attractive prices. This in turn would discourage the vital research function we perform."
I don't believe that current thinking on proxy plumbing reforms is for public disclosure of the identity and investments of all shareholders, but in this day of data aggregation and high speed computers and communications, widespread "investor profiling" is possible -- leaving aside the issue of data breaches. A discussion of privacy concerns regarding possible NOBO/OBO system modifications can be found in the white paper published by the Council of Institutional Investors.
Also according to the letter, "The current system works because it separates issuers from overseeing every aspect of the proxy system. The deck is already stacked in favor of issuers' managements." It foreshadows that "were issuers to have access to all shareholders or greater control over vote tabulation, we would anticipate further entrenchment of imperial executives and rubber-stamp Boards." Not a pretty picture.