Categories: Stocks

Proxy Statement

A Proxy statement is a mandatory requirement as per US SEC’s (Securities & Exchange Commission) guidelines. It is mandatory information which a company needs to provide to its shareholders, if it is listed on US stock exchanges. The purpose of providing a proxy statement to clients is to enable them to make better and informed decisions.

Key characteristics of Proxy statement

Some characteristics of Proxy statement are :
a) It can include proposal for addition to Board of Directors, information on their salaries etc
b) It contains information related to bonus paid to directors, incentives to key personnel, management decisons and other declarations etc.
c) It needs to be filed with the SEC and then shared with shareholders for making them aware before the voting process

Importance of Proxy statement

Proxy statement provides useful information like :
a) Related party transactions
b) Loan availed by senior management
c) Compensation/Bonus of senior management
d) Management Profile

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