Dec. 3, 2002 — Vanguard Group said shareholders approved a proposal making it easier for eight of its stock index funds to change the benchmarks they track.

The company has no plans to change any of the benchmarks, said Gus Sauter, a managing director in charge of Vanguard’s quantitative equity group.

The proposal enables trustees for the funds to change their target indexes without having to get shareholder backing. The policy, Vanguard said, allows the trustees to find new indexes that may be superior to those the funds are now designed to mimic.

The funds, which have about $45 billion in assets, are: Vanguard Total Stock Market Index/Inv (VTSMX), Vanguard Extended Market Index/Inv (VEXMX), Vanguard Small Cap Index/Inv (NAESX), Vanguard Growth Index/Inv (VIGRX), Vanguard Value Index/Inv (VIVAX), Vanguard Mid Cap Index/Inv (VIMSX), Vanguard Small Cap Growth Index/Inv (VISGX) and Vanguard Small Cap Value Index/Inv (VISVX).

The change, Sauter said, is aimed at giving the funds greater flexibility to change the indexes they follow. Eighteen other Vanguard stock index funds have the ability to change indexes without shareholder approval, he said.

The Vanguard 500 Index/Inv (VFINX), which mimics the Standard & Poor’s 500 index, cannot unilaterally make such a change and the company does not plan to change that policy, Sauter said.

That fund’s shareholders “really have decided they want to invest specifically in the S&P 500, as opposed to a general large-cap index,” Sauter said. Since the fund and its benchmark “seem to have their own brand recognition, we didn’t think it would be appropriate to try to change that one,” he added.

Under the policy, none of the eight funds can change their investment styles without shareholder approval.

Vanguard said shareholders also approved a proposal enabling Vanguard Utilities Income (VGSUX) to invest in a more diverse group of companies. The change, Vanguard said, allows the fund to seek “reasonable dividend income plus attractive earnings and dividend growth prospects.” As a result of the change, the offering will be renamed the Vanguard Dividend Growth Fund.