Shareholders in public companies typically have voting rights associated with their shareholdings. These voting rights allow shareholders (including institutions such as Fidelity, acting on behalf of all the funds it manages) to vote at annual and special company meetings. Most shareholders, including the Fidelity Funds, generally submit votes by proxy rather than attend each meeting.
The typical agenda for a company meeting will include more than one proposal, such as the election of directors, adoption of a stock option plan or approval of a merger or acquisition. Proposals are more commonly put forth by the company’s management, but may be submitted by a shareholder as well. The company’s management may provide a voting recommendation for each proposal, and each proposal is evaluated separately by Fidelity in accordance with our Proxy Voting Guidelines.
Investment funds in Canada, including the Fidelity Funds, must display their proxy voting records on their websites by August 31 of each year, covering the 12-month period ending June 30 of that year. Unitholders may also request a copy of the proxy voting record for this same period be delivered to them, at no charge, after August 31 of each year.
Please note that we do not provide proxy voting results for certain funds that invest their assets in other Fidelity Funds. When a Fidelity Fund invests in an underlying fund also managed by Fidelity, Fidelity will either abstain from voting those securities of the underlying Fidelity Fund, or will arrange for those securities of the underlying Fidelity Fund to be voted by the beneficial holders of the top Fidelity Fund. When a Fidelity Fund invests in an underlying mutual fund or exchange-traded fund that is not managed by Fidelity, Fidelity will vote in the same proportion as all other security holders of such underlying fund or class (“echo voting”). Fidelity may choose not to vote if “echo voting” is not operationally feasible.
View proxy voting results by selecting a Fidelity Fund
Fidelity’s approach to voting proxies
Fidelity Canada Investments ULC (“FIC”) acts as the advisor to the Accounts and engages in investment management activities for certain Accounts. FIC engages multiple sub-advisors (the Sub-Advisors) who maintain their own proxy voting policies and guidelines (the Sub-Advisor Policies and Guidelines). FIC delegates proxy voting authority to the respective Sub-Advisor(s) who manage the proxy voting process in accordance with the Sub-Advisor Policies and Guidelines.
FIC has appointed Fidelity Management and Research, LLC. (“FMR”), Fidelity International Limited (“FIL”), and Geode Capital Management, LLC (“Geode”) to vote proxies and manage the proxy voting on behalf of the Accounts they manage. For example, FMR will be responsible for votes pertaining to FMR and, FIAM LLC, and Fidelity Institutional Money Management, Inc. FIL and Geode will be responsible for voting their respective proxies and managing the proxy voting process for their sub-advised Accounts in accordance with their respective guidelines. In addition, FIL is responsible for voting proxies and managing the proxy voting process for Accounts that FIC directly advises (“FIC Managed Accounts”) in accordance with FIC’s proxy voting guidelines (the “FIC Proxy Voting Guidelines”).
Fidelity’s approach to proxy voting decisions is consistent with our approach to investment decisions: we evaluate proposals on economic merit and support those that are reasonably likely to enhance shareholder returns. While we always remain focused on maximizing long-term shareholder value, we also consider potential environmental, social and governance (ESG) impacts. In addition, to the extent that a company’s management is committed and incentivized to maximize shareholder value, we generally vote in favour of management’s proposal. However, adhering to our proxy voting guidelines does in fact sometimes result in our submitting proxy votes that are contrary to management’s recommendations. One example includes our voting against overly dilutive share compensation plans that do not adequately align management and shareholder interests. Fidelity can ultimately voice its opinions on the policies of management through the level of ownership the Fidelity Funds maintain in the individual companies.
In addition, Fidelity may choose not to exercise its voting rights at certain company meetings in instances where trading restrictions are placed on voted shares. This situation occurs most often in foreign countries in which voted shares cannot be traded from the time the vote is cast until the day after the meeting. Moreover, when a Fidelity Fund invests in an underlying fund also managed by FIC, FMR, FIL, or GEODE, as applicable, will not vote those securities of the underlying Fidelity Fund held by the top Fidelity Fund. Instead, where applicable, Fidelity will arrange for such securities of the underlying Fidelity Fund to be voted by the beneficial holders of the top Fidelity Fund. Similarly, when a Fidelity Fund invests in an underlying fund that is not managed by FIC, FMR, FIL, or Geode, the Fidelity Fund will vote in the same proportion as all other unitholders of such underlying fund (“echo voting”). FIC, FMR, FIL and Geode may choose not to vote if “echo voting” is not operationally feasible.