Understanding Stockholder Voting Rights: A Guide for Investors

When an investor purchases shares of stock, she will also get a voting right in the company. Many individual investors do not pay much attention to these voting rights. However, they are another benefit that you receive by purchasing stock.

Voting Rights

Stockholder voting rights are a very important feature for investors to have. The strength of your vote will depend upon how many shares you own. For example, someone with 10 shares in the company will be able to cast 10 votes. You do not necessarily have to be present at a shareholder meeting in order to vote. You can vote by proxy through the mail if you cannot attend a meeting.

What You Can Vote On

Shareholders can exercise this right to vote on a number of different things. Shareholders will vote on important matters that have to do with the company. For example, they will be in charge of electing individuals to sit on the board. Shareholders will also be called upon to help decide corporate policies or a particular direction for the company to go in. If a company is going to issue additional shares of stock, you will also be able to vote on this process.