The Securities and Exchange Commission’s Rule 30e-3, adopted earlier this year, allows companies and broker-dealers to send investors investors full copies of shareholder reports via the internet instead of mailing them, thereby cutting costs.
And while the SEC estimates potential cost savings of over $230 million annually on paper, printing and postage, it’s going to be tough for some companies to switch over.
The new rule allows funds to begin using the new delivery option on Jan. 1, 2021, as long as they notify shareholders beginning on Jan. 1, 2019. Fund companies and BDs also have to quickly provide shareholders with a way to opt out of the notice delivery method. Lots of companies and BDs, however, may not be prepared for implementation of the new rule, even if they’re looking to cut the costs of delivering all those reports.
That’s where Broadridge comes in. It’s offering a universal solution to capture and manage shareholder preferences during the two-year notification period in the form of a centralized website to help firms manage delivery preferences. Shareholders can access the site for all funds via the unique identification numbers tied to their accounts.