Demat Account: What is electronic voting and how does it work? MintGenie explains

In the regular course of business, companies frequently propose resolutions related to corporate policies, board appointments, and various corporate actions. These resolutions must undergo shareholder approval, providing investors with the opportunity to participate in crucial decision-making processes. 

Shareholders wield the power to vote on these resolutions, determining their fate by either endorsing or declining them. It's worth noting that only shareholders holding shares on the record date are entitled to exercise their voting rights, ensuring that the decisions reflect the current ownership structure of the company.

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Shareholders receive notification of proposed resolutions, typically ahead of a company's annual general meeting (AGM) or other special meetings, and they have the opportunity to cast their votes. Shareholders can exercise their voting rights through various means, including in-person attendance, proxy voting, postal or mail-in ballots, and electronic voting. 

Among all these, the most convenient way to vote is through electronic voting, as it reduces time and has efficiency.

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What is Electronic Voting? 

Electronic voting, also known as e-voting, refers to the process of casting votes using electronic means, such as the internet or specialised voting machines. It allows voters to submit their votes electronically instead of using traditional paper-based ballots.

Electronic voting offers several potential benefits, including increased accessibility and convenience for voters, faster and more efficient vote counting, reduced costs associated with printing and distributing paper ballots, and enhanced security measures to safeguard the integrity of the voting process.

Further, e-voting platform aims to improve transparency and corporate governance standards and also helps in reducing the administrative cost associated with postal ballots while facilitating the declaration of results immediately after the close of the voting. 

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Moreover, investors enjoy the advantage of casting their votes until the last day from the convenience of their home or office, thereby reducing the risk of their votes being invalidated.

In compliance with directives from the Ministry of Corporate Affairs (MCA), both Indian depositories, NSDL and CDSL, have established electronic infrastructure. This infrastructure allows shareholders to electronically cast their votes via the internet.

Process for Electronic Voting

Notification: Shareholders receive notification from the company or their Depository Participant (DP) regarding an upcoming meeting and the agenda items to be discussed.

Voting Period: The company announces the voting period during which shareholders can cast their votes electronically. This period typically begins well in advance of the meeting date to allow shareholders sufficient time to review the agenda and make informed decisions.

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Access to Voting Platform: Accessing the voting platform is simple for shareholders, who can do so through their demat account. Most depository participants in India offer e-voting services through demat accounts. When investors click on the "shareholder e-voting" tab in their demat account, they are redirected to the CDSL or NSDL page for e-voting.

Cast Votes: Once logged in, shareholders can view the agenda items and cast their votes electronically. They can vote in favor, against, or abstain from each agenda item as per their discretion.

Confirmation: After submitting their votes, shareholders receive a confirmation message acknowledging the receipt of their votes. This confirmation serves as a record of their participation in the voting process.

Vote Tabulation: The votes cast by shareholders electronically are tabulated and verified by the company's registrar and share transfer agent. The results are then announced during the meeting.

Shareholders can monitor current e-voting events via the CDSL website at https://www.evotingindia.com/onGoingStatus.jsp. 

Alternatively, they can visit the NSDL website at https://www.evoting.nsdl.com/eVotingWeb/listActiveEvenReport.do to access the same information.

FAQs

What is e-voting?

e-voting is a method of voting conducted through an internet-based platform. Shareholders have the opportunity to cast their votes on resolutions proposed by companies in accordance with existing rules and regulations, eliminating the need to send their votes via postal mail.

Can a proxy vote be cast in the e-voting system?

While the e-voting system offers flexibility and convenience for shareholders to cast their votes online, it eliminates the necessity of appointing a proxy. However, shareholders still have the option to appoint a proxy to attend the general meeting on their behalf and cast their vote at the venue, either by physical ballot or TAB-based electronic voting.

Is it possible for a shareholder to change a vote already cast before the closing of the e-voting cycle?

No, according to the Companies (Management and Administration) Rules, 2014, once a vote has been cast, it is considered final and cannot be modified. However, shareholders can still cast their vote for any pending resolutions for which they have not yet voted.

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Can companies offer tablet-based voting at general meeting venues?

Yes, companies have the option to provide tablet-based voting facilities at general meeting venues. Members who attend the meeting and have not already cast their votes through remote e-voting are eligible to exercise their voting rights at the meeting using tablet-based voting.

How do shareholders access the e-voting platform through their demat account? 

Shareholders can easily access the e-voting platform through their demat account by clicking on the "shareholder e-voting" tab. Once clicked, they are redirected to either the CDSL or NSDL page for e-voting, where they can cast their votes on resolutions proposed by companies. This streamlined process allows shareholders to participate in corporate decision-making conveniently and efficiently.