Digital transformation and shareholder expectations are reshaping proxy voting in corporate South Africa

Proxy voting is reshaping South Africa’s corporate governance through:

• Digital platforms enabling real-time, transparent voting.
• Empowered shareholders driving board diversity and accountability.
• ESG momentum aligning votes with sustainability goals.
• Regulatory reforms boosting transparency and global alignment.
• Activism and media engagement amplifying investor voices and public discourse.

Together, these forces are making proxy voting a cornerstone of responsible and inclusive governance.

“Proxy voting plays a central role in corporate accountability, enabling shareholders especially institutional investors and asset owners to actively participate in key decisions around governance, ESG and remuneration, even when they cannot be physically present at meetings,” says Sam Dahya, Head of Investor Services, Custody and Investment Administration at Standard Bank Corporate and Investment Banking (CIB).

The evolution of proxy voting reflects a broader shift in how shareholders want to engage with the companies they invest in.

The proxy voting ecosystem in South Africa is a collaborative network of shareholders, issuers, custodians, proxy advisors, transfer secretaries, and regulators each playing a vital role in strengthening corporate governance. Custodians, in particular, act as trusted intermediaries, ensuring shareholders are informed, voting instructions are accurately managed, and investment mandates are upheld. Through transparent reporting and regulatory alignment, custodians help drive accountability, empower investor participation, and reinforce the integrity of the voting process.

“Increasingly, clients expect real-time visibility into how their votes are processed. In response, Standard Bank has made significant investments into digital solutions that automate instruction flows, reduce manual intervention and provide detailed reporting and audit trails,” adds Dahya.

Standard Bank’s proprietary voting platform exemplifies innovation in proxy voting. Seamlessly integrated with market infrastructure including STRATE’s e-voting portal, Proximity, and global providers like Broadridge, it empowers institutional clients to vote effortlessly across diverse mandates and jurisdictions. This multi-channel connectivity enhances operational efficiency, strengthens governance participation, and reinforces Standard Bank’s leadership in delivering secure, scalable, and globally aligned voting solutions.

However, while the digitisation of voting mechanisms has improved operational efficiency, regulation still lags.

“Current legislation limits shareholder communication to registered mail or email, which is clearly out of step with modern platforms,” says Palesa Banda, Head of Custody at Standard Bank CIB.

“To drive participation and efficiency, we need to align regulation with today’s digital capabilities,” she adds.

Proposed updates under the King V Code on Corporate Governance, which underpins how corporates are governed, published earlier this year are also expected to raise the bar for transparency.

Under the current King IV Code, issuers are only required to publish the outcome of resolutions. However, in recent times, a noticeable increase in pressure for detailed annual general meeting (AGM) minutes to be made available has become evident as shareholders seek better understanding of the context for key decisions.

South Africa’s proxy voting market already benefits from a strong foundation. The country has operated in a dematerialised environment for over two decades and was among the first to legally enable virtual and hybrid AGMs - well before the Covid-19 pandemic made them a necessity.

Still, it is evident that more must be done to take the proxy voting system from merely being functional to truly best-in-class. To this end, the bank has been actively involved in expanding digital access, advocating for regulatory reform, and enhancing platform interoperability.

“We see three priorities going forward,” says Dahya. “First, deeper digital integration across the ecosystem to support interoperability and to give client choice in the usage of these digital platforms. Second, real-time vote tracking and reporting. And third, regulatory frameworks that enable modern participation rather than restricting it.” Both Dahya and Banda also point to the potential of artificial intelligence to enhance forecasting, engagement, and future voting trends.

“As custodians, we have a responsibility to support shareholders with the tools, insight and infrastructure to act with confidence,” says Banda. “This goes beyond operational efficiency - it’s about empowering investors to influence the companies they own in ways that are transparent, timely, and aligned to long-term value.”

“With increased industry collaboration, South Africa can go beyond merely modernising proxy voting, Dahya argues, “We can lead the way globally in how shareholder engagement is effectively executed.”