Notice and Access: How Shareholders Receive Proxy Materials

Notice and access is an SEC rule that allows public companies to publish proxy materials on a website and send shareholders a brief notice (instead of mailing the full prospectus). Shareholders retain the right to request paper copies, but most receive the materials by internet link, cutting company costs and reducing paper waste.

Origins of Notice and Access

Before 2007, the SEC required companies to mail full proxy materials to all shareholders. For a large public company with millions of shareholders, this meant printing and shipping millions of pages of proxy statements, annual reports, and ballots—a significant expense and environmental impact.

In 2007, the SEC adopted the notice-and-access rule to modernize shareholder communication. The rationale: the internet is ubiquitous, most shareholders check email, and most proxy materials are already available digitally. The rule allows companies to mail a one-page notice directing shareholders to a website where they can read or download the materials and vote online.

The rule is optional—companies can still choose to mail full materials if they prefer—but the vast majority have adopted notice and access because of cost savings and logistical simplicity.

How Notice and Access Works

Under the notice-and-access framework, the process unfolds in this sequence:

1. Company posts materials on a website. The company publishes its proxy statement, annual report (Form 10-K), and voting materials on a designated URL (often investor relations portal or a third-party proxy service).

2. Company mails a one-page notice. Instead of the full proxy packet, the company mails a brief notice to each shareholder. The notice includes:

• The date and time of the annual meeting.
• Instructions on how to access materials online (URL or username/password).
• Instructions on how to vote (in advance online or at the meeting).
• A link or instructions for requesting a paper copy.

3. Shareholders can vote online or request paper materials.

• Most shareholders vote directly from the website using login credentials.
• Any shareholder can request a paper copy by phone, email, or website link. The company must mail paper materials within 3 business days.
• Shareholders attending the meeting in person can vote at the meeting itself.

4. Proxy service tallies votes and reports results. The company (or its proxy service) collects votes, verifies shareholder eligibility, and counts ballots. Results are announced at or after the annual meeting.

Who Can Use Notice and Access

The rule applies to public companies that must file proxies with the SEC (typically companies listed on NYSE, Nasdaq, or other major exchanges). Private companies, mutual funds, and REITs have different rules.

Companies can use notice and access for:

• Shareholders of record (those who hold shares directly, not in a brokerage account).
• Beneficial owners (shareholders whose shares are held by a broker or custodian) — though the company must coordinate with the broker’s system.

Brokers have their own proxy systems and often use notice and access as well, sending notices to beneficial owners and hosting voting on their platforms.

Shareholder Rights and Paper Copy Requests

A shareholder has an absolute right to receive paper copies of proxy materials, and notice and access cannot take that away.

If a shareholder requests paper materials:

• The company must mail them within 3 business days.
• A shareholder who requests paper copies for one meeting may be presumed to want them for all future meetings (unless they revoke the request).
• Requests can be made by phone, email, or via the company’s website.

In practice, paper copy request rates are low—often 0.5–2% of shareholders—because most investors use email or have online access, and the mail delay (3+ days) makes voting online faster. But the option remains available for shareholders without internet access or those who prefer paper.

Mechanics of Voting Under Notice and Access

Once a shareholder receives the notice and accesses the materials, voting is typically electronic:

Online voting is available from the time materials are posted (usually 30+ days before the meeting) through the day before the meeting. Shareholders log into a voting portal, review proxy statement materials on-screen, and mark their votes (for/against/abstain on each proposal).

In-person voting at the annual meeting is still available. Shareholders can attend, present questions to management, and vote by ballot.

Repeat voting protection — Once a shareholder votes, their vote is locked in. If they log in again and attempt to vote differently, the system rejects the second vote. This prevents double-counting.

Broker non-votes — Shareholders who do not vote are often marked “broker non-votes” if shares are held by a broker. Brokers cannot vote shares on routine matters without shareholder instruction, so those shares do not count as votes unless the shareholder votes.

Why Companies Adopted Notice and Access

Cost reduction is the primary driver. A large public company can save $500,000–$5 million annually in printing, postage, and handling by using notice and access instead of mailing full materials to millions of shareholders. For smaller companies, the savings are proportionally smaller but still material.

Environmental benefit — Reducing paper consumption aligns with corporate sustainability commitments.

Operational simplicity — Notice and access fits naturally into modern investor relations workflows, where documents are already digitized and stored online.

Criticisms and Limitations

Barrier to engagement — Critics argue that notice and access reduces retail shareholder participation. A printed proxy statement in the mailbox is passive reminder; a login-required website is a small friction point. Some evidence suggests that notice-and-access shareholders are slightly less likely to vote, though the effect is modest.

Limited disclosure scrutiny — Proxy statements are dense documents (often 100+ pages). Sending them by link rather than mail may reduce the number of shareholders who actually read them, potentially lowering public scrutiny of executive compensation, board conflicts, or other material disclosures.

Digital divide — Shareholders without reliable internet access or email may be disadvantaged, though the right to paper copies partially addresses this.

Accessibility — Some older or less tech-savvy shareholders find the notice-and-access website harder to navigate than a printed document, even though many companies design voter portals to be simple.

Notice and Access Across Markets

Notice and access is now widespread in the United States. The SEC estimates that more than 80% of public companies use the rule. Many countries have adopted similar “electronic notice” or “posting” rules (e.g., United Kingdom, Canada, Australia), though the specifics vary.

In markets without such rules, companies still often post proxy materials online as a convenience, but are legally required to mail full documents as well.

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