Lake Success, New York – December 1, 2010 – “New technologies are creating the opportunity to dramatically enhance corporate governance and take transparency, participation, and fairness to a new level,” said Richard J. Daly, chief executive officer of Broadridge Financial Solutions (NYSE: BR).
Broadridge builds the infrastructure that underpins proxy services for over 90 percent of public companies and mutual funds in North America and is the market leader enabling secure and accurate processing of information for communications and securities transactions among issuers, investors and financial intermediaries.
Speaking before several hundred business executives and university faculty at Hofstra University’s Frank Zarb School of Business conference “Social Responsibility in Business in the 21st Century,” Mr. Daly called on the Securities and Exchange Commission to give public companies the right to social media technology to communicate with their shareholders.
“Some believe we can wait and see. They believe these developments, if they have merit, will take hold by themselves,” Mr. Daly said. “But the truth is that changing the paradigm rapidly for all investors will require regulatory support. These changes require complex support from issuers, intermediaries, investors, and regulators, all of whom have their own needs…we need to work with intensity and urgency to help investors regain confidence in our system of markets and governance,” he explained.
Citing statistics that retail voting declined from 20 percent four years ago to less than five percent in 2010, Mr. Daly said, “Reduced participation in key governance issues is coming at a time when the need for two-way communication with shareholders is dramatically increasing.”
Highlighting several solutions in his prepared remarks, he said, “The explosive growth of social media is creating a new paradigm that is transforming how people spend time and make critical decisions…that same technology can provide knowledge transfer, voting participation opportunities, and transparency between shareholders, boards, management, and regulators at levels that could prevent many of the financial mishaps over the past decade. A true Investor social network could both prevent these mishaps and raise investor confidence.”
Mr. Daly added that it is possible through Broadridge’s technology to uniquely validate investors, which isn’t possible in other Internet forums. “What is unique about an investor social network is we can know with complete confidence that the person whose post you are reading or with whom you are communicating is an actual investor, and that changes everything. The exciting thing is this technology exists today and can be rapidly implemented,” he concluded.
Saying that greater transparency, more participation, and a fairer market for all are straightforward ideals, Mr. Daly added: “Social media technology leveraging a new investor network has the power to help address the challenges our capital markets face while driving us toward a new era where greater transparency, more participation, and a fairer market for all are not just ideals, they are a reality.”
For a copy of Mr. Daly’s prepared remarks, please click here.