Derek Pain: Forcing the electronic option is a dereliction of a company's duty

No Pain, No Gain

Traditional investors are under pressure to bow before this electronic age. I have complained before about the devious ways that are adopted to prompt shareholders to give up their entitlement to receive hard copy communications and dividend cheques. Thankfully, the campaign waged so beguilingly a few years ago to abolish paper share certificates seems to have died the death. I expect it will be resurrected before too long.

To save money, quoted companies and the City would like all shareholders to rely on their computers for information, including annual reports which were once regarded as powerful publicity mediums. There are also continuing moves to encourage electronically transmitted dividend payments direct to a shareholders' banks instead of posted dividend cheques. Whereas it is possible to charge investors more if they request certificated deals when buying shares it is not quite so easy to extract cash from those who want printed reports and dividends through the post.

Many quoted companies and their City cohorts rely on subtle methods to obtain compliance. For example, most shareholders who want to retain printed reports have to make contact with the company or its registrar. Surely, it should be those who wish to change the system and go on-line who should make such an effort? After all, why should "no change" require a declaration while those opting for the electronic switch sit back and take no action? It seems a devious attempt to capitalise on the inertia of mainly small investors. Such methods represent a dereliction of a company's duty to its shareholders.

Dividend cheques, which allow the recipient a choice of accounts, also get the hard-line treatment. An example is provided by Lighthouse, the accountancy group that is a constituent of the No Pain, No Gain portfolio. Company secretary Mark Ross, in a letter accompanying the printed interim report, says dividends will be paid directly to shareholders' banks if the registrar holds the necessary authority. He adds: "Should that authority not yet be in place, then the documentation enclosed with the warrant and tax voucher will set out the requirements to be followed in this regard". No mention that cheques are still part of the system. Admittedly, they are under some threat of extinction because usage is declining. But in the numbers game, the indisputable fact that, often, one cheque represents half-a-dozen transactions is conveniently ignored. The VAT authority's strange decision not to accept cheques but only on-line payments is another example of the intolerable pressure now being inflicted on traditionalists.

It is, of course, small and in some instances less sophisticated investors who suffer in the face of this electronic blitz. Major shareholders and professional investors are able to take care of themselves and, I imagine, already conduct many operations on line and in the case of private investors endure the indignities of nominee accounts.

I suppose age is a factor. It is we old'uns who dislike change. I, one of those to get George Osborne's blessing to continue to receive a free TV licence, do not wish to accept on-line dominance. The internet seems fraught with danger which is underlined by the weekly news diet of villainous on-line shenanigans. It is not my desire to dissuade any investor from embracing the internet and all that goes with it. But I feel those who do not want to should be allowed, perhaps even encouraged, to carry on the old-fashioned way. Such a Luddite approach is not popular in the City.

The portfolio is a buy-and-hold investor. It favours hard copy and dividend cheques. That is not to say it ignores the internet. I frequently log on to the excellent ADVFN service and the Plus market as well as other facilities. But I have no desire to trade shares or bank on-line.

There is evidence that many don't want to embrace computers. Who knows? Perhaps the Vince Cable initiative for a corporate rethink will address the problems of harassed investors. I doubt it.

The portfolio has dumped Nighthawk Energy at 14p. The selling tide is too strong to resist. More next week. Another constituent Private & Commercial Finance indicated half-year profits would be in line with expectations.

yourmoney@independent.co.uk

Independent Partners; Do you need financial advice on your investments, pension or insurance? Book a free consultation with an independent Financial Adviser at VouchedFor.co.uk

News
Keith Fraser says we should give Isis sympathises free flights to join Isis (AFP)
news
Life and Style
Google celebrates the 126th anniversary of the Eiffel Tower opening its doors to the public for the first time
techGoogle celebrates Paris's iconic landmark, which opened to the public 126 years ago today
News
Cleopatra the tortoise suffers from a painful disease that causes her shell to disintegrate; her new prosthetic one has been custom-made for her using 3D printing technology
newsCleopatra had been suffering from 'pyramiding'
News
people
Arts and Entertainment
Coachella and Lollapalooza festivals have both listed the selfie stick devices as “prohibited items”
music
Sport
Nigel Owens was targeted on Twitter because of his sexuality during the Six Nations finale between England and France earlier this month
rugbyReferee Nigel Owens on coming out, and homophobic Twitter abuse
Finacial products from our partners
Property search
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

ES Rentals

    iJobs Job Widget
    iJobs Money & Business

    Ashdown Group: Trainee Consultant - Surrey / South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Ashdown Group: Trainee Consultant - Surrey/ South West London

    £22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

    Recruitment Genius: Client Services Assistant

    £18000 - £20000 per annum: Recruitment Genius: A Client Services Assistant is ...

    Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

    £25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

    Day In a Page

    No postcode? No vote

    Floating voters

    How living on a houseboat meant I didn't officially 'exist'
    Louis Theroux's affable Englishman routine begins to wear thin

    By Reason of Insanity

    Louis Theroux's affable Englishman routine begins to wear thin
    Power dressing is back – but no shoulderpads!

    Power dressing is back

    But banish all thoughts of Eighties shoulderpads
    Spanish stone-age cave paintings 'under threat' after being re-opened to the public

    Spanish stone-age cave paintings in Altamira 'under threat'

    Caves were re-opened to the public
    'I was the bookies’ favourite to be first to leave the Cabinet'

    Vince Cable interview

    'I was the bookies’ favourite to be first to leave the Cabinet'
    Election 2015: How many of the Government's coalition agreement promises have been kept?

    Promises, promises

    But how many coalition agreement pledges have been kept?
    The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

    The death of a Gaza fisherman

    He built his own reef, and was fatally shot there by an Israeli gunboat
    Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

    Saudi airstrikes are fuelling the Gulf's fire

    Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
    Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

    The only direction Zayn could go

    We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
    Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

    Spells like teen spirit

    A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
    Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

    If fashion is a cycle, this young man knows just how to ride it

    British designer Jonathan Anderson is putting his stamp on venerable house Loewe
    Number plates scheme could provide a licence to offend in the land of the free

    Licence to offend in the land of the free

    Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
    From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

    From farm to fork in Cornwall

    One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
    Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

    Robert Parker interview

    The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
    Don't believe the stereotype - or should you?

    Don't believe the stereotype - or should you?

    We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor