The Future of Shareholder Engagement in Asia-Pacific

Introduction: A Critical Moment for Shareholder Democratisation

As participation in US equities rises among Asia-Pacific investors, regional institutions face intensifying pressure to deliver efficiency and transparency. This demand is forcing a structural shift in how issuers, custodians, and regulators handle shareholder engagement.

At the FT–Broadridge Roundtable hosted in Hong Kong in September (held under the Chatham House Rule), participants explored how digital acceleration, regulatory alignment, and sustainable governance principles are reshaping corporate–investor relationships in the region. APAC’s diverse markets are adapting to global expectations while navigating unique local structures and compliance systems.

Executive Summary

1. Investor expectations are rising: Retail participation, global capital flows, and generational change are driving demand for transparency, inclusivity, and seamless digital engagement. Investors across APAC are increasingly active in global equities and expect engagement standards that match international norms.

2. Systems remain fragmented: Proxy voting, ownership records, and cross-border infrastructure across APAC are inconsistent, with different regulatory cut-offs and disclosure formats creating inefficiency and undermining investor trust.

3. Technology is a catalyst: Digital platforms, AI, and blockchain are helping simplify engagement, reconcile records, and build confidence. However, adoption varies market to market, hindered by regulatory differences and legacy frameworks.

4. Balancing transparency and security: Institutions must modernise engagement infrastructure while meeting privacy and cybersecurity obligations across diverse regional regimes.

5. Collaboration and harmonisation remain key: True advancement requires coordinated frameworks that connect regulators, intermediaries, and technology providers to deliver fair, efficient, and scalable engagement solutions across Asia-Pacific.

• Democratisation of capital markets: Retail investors across Asia-Pacific are buying into global equities — especially US listings — which is redefining engagement expectations.

• Geopolitical complexity: Differences in market regulations make harmonisation challenging and impede cross-border consistency.

• Generational change: Younger and more values-driven investors emphasise immediacy, sustainability, and mobile-first engagement experiences.

The collective effect of these trends is clear: APAC’s rising investor class demands digital transparency consistent with global standards.

Challenges in Proxy Voting and Shareholder Access

Retail and cross-border participation are expanding, but fragmented infrastructure, data inconsistency, and opaque reporting processes remain major obstacles.

• Fragmented infrastructure: Cross-border holdings passing through multiple intermediaries create bottlenecks, delays, and lost or unverified votes.

• Regulatory divergence: Jurisdictional variations in disclosure requirements and cut- off timelines increase cost and complexity, forcing intermediaries to customise approaches for each market.

• Opaque record-keeping: Inaccuracies in vote reconciliation and beneficial ownership records have eroded investor confidence.

• Legacy systems: Manual and paper-based processes are still prevalent, leading to inefficiencies.

Unlike Europe, APAC lacks a centralised regulatory framework, requiring institutions to adapt locally. While this adds complexity, it also provides flexibility for market-led innovation — allowing technologically advanced economies such as Singapore, Hong Kong, and Australia to test digital solutions that could benefit regional reform.

Technology as a Catalyst for Transformation

Digitisation continues to redefine shareholder engagement.

• Digital platforms simplify the shareholder journey: Integrated dashboards and mobile-first interfaces provide investors with real-time visibility and assurance that votes have been recorded.

• Automation and AI improve efficiency: Smart workflows and automated reconciliation streamline participation while reducing operational risk.

• Mobile-first engagement: APAC’s high smartphone penetration positions the region to lead innovation in mobile-based shareholder interaction.

• Emerging technologies: Blockchain and distributed ledger tools offer promise for traceable, auditable vote records, though widespread adoption is slowed by cost, scalability, and regulatory disparity.

Rapid digital innovation — combined with less entrenched legacy infrastructure — gives Asia-Pacific the potential to leapfrog slower-moving regions once governance and data frameworks align.

Balancing Transparency, Privacy and Security

Asia-Pacific’s regulatory diversity requires a careful balance between transparency, investor privacy, and system security.

• Privacy obligations: Institutions must comply with data rules ranging from GDPR- equivalent standards to local protection laws, limiting how information can be shared.

• Cybersecurity resilience: As proxy voting becomes increasingly digital, safeguarding against cyber threats must be integral to system design.

• Privacy by design: Embedding consent, data control, and cybersecurity functionality ensures compliance and builds investor trust.

For APAC, harmonising these standards across jurisdictions will be critical in facilitating seamless cross-border participation.

• Ecosystem alignment: Issuers, custodians, regulators, and fintech providers must co-develop interoperable frameworks for proxy distribution and reconciliation.

• Friction reduction: Simplified communications, multilingual notifications, and mobile-optimised portals can widen retail access and improve participation rates.

• Auditability and trust: Transparent confirmation mechanisms and reconciled data trails strengthen confidence and accountability.

As retail participation expands, inclusive design and straightforward engagement tools will determine success.

Partnerships and Ecosystem Collaboration

No single organisation can solve these structural challenges alone. Effective shareholder engagement depends on collaboration between technology providers, brokers, custodians, regulators, and regional associations.

Public–private partnerships will be essential in APAC, helping to bridge differences between markets and accelerate the adoption of shared digital standards that support interoperability and regulatory alignment.

Industry associations can also play a convening role, enabling dialogue and guiding harmonisation initiatives.

Cultural and Generational Shifts

Changing investor demographics are reshaping expectations. New generations of shareholders are more values-driven, digitally native, and less tolerant of opaque governance processes.

• Trust and confidence: In many APAC markets, past experiences of limited vote validation have made investors sceptical. Rebuilding trust through plain-language communications and transparency tools remains essential.

• Financial literacy and accessibility: Fintech-driven education and digital resources can help improve participation and understanding of shareholder rights.

Digital engagement must evolve to meet the needs of younger investors while supporting inclusive participation from both retail and institutional shareholders.

Operational and Strategic Implications for Institutions

For Asia-Pacific institutions, shareholder engagement is shifting from a procedural function to a strategic differentiator.

• From compliance to strategy: Institutions that treat engagement as a trust-building opportunity rather than a regulatory requirement will strengthen reputation and investor loyalty.

• Infrastructure investment: Legacy systems can no longer handle growing retail participation; scalable digital solutions are essential to ensure accuracy and transparency.

• Measurement and outcomes: Clear engagement metrics — including participation rates and turnaround times — demonstrate accountability and value creation.

Institutions that act early to modernise systems and align frameworks regionally will gain a competitive advantage as participation deepens.

Standards and Harmonisation as the Long-Term Solution

Harmonisation remains the foundation for sustainable shareholder engagement reform across Asia-Pacific.

• Shared protocols and data standards: Enable smooth information flow and reconciliation.

• Common cut-off timelines: Improve fairness, visibility, and participation accuracy.

• Regional coordination: Leadership from key financial centres such as Hong Kong, Singapore, and Tokyo could drive convergence on auditability, accessibility, and efficiency.

• Agility and adaptability: APAC’s lack of deeply entrenched legacy infrastructure could accelerate best-practice adoption, especially through collaborative initiatives.

Conclusion: A Shared Responsibility

The modernisation of shareholder engagement in Asia-Pacific is both a strategic and collective responsibility. Financial institutions, regulators, and technology partners must collaborate to deliver transparent, secure, and inclusive participation that reflects APAC’s growing global influence.

If harmonisation and collaboration continue, Asia-Pacific will not just align with international standards — it has the potential to define them.