Unless doing so is not felt to be in the interests of our Funds (or would otherwise be inappropriate given market practice or applicable legal requirements), analysts consider informing the company's representatives in advance of their intention to vote against any of management's recommendations, especially if the Orbis Funds (in the aggregate) hold a material position in a company. This often creates an opportunity for the analyst to explain to the company's directors why they believe a resolution is not in shareholders' interests and to hear their side of the story. Such engagement can contribute to making an analyst's ongoing relationship with company management more constructive, for example, by the company seeking our opinion on important matters in future.
Also, as signatories to the Japan Stewardship Code, we aim to arrive at a common understanding with investee companies and work to solve problems through constructive engagement. Consistent with this objective, we typically write to the management of Japanese companies held in the Orbis Funds to express our intention to vote against proposals at shareholder meetings. When doing so, we typically explain our rationale for doing so and, where appropriate, make additional recommendations.
We do not typically communicate our voting rationale publicly as we generally consider engaging with companies privately to be more constructive. If however private engagement appears to be ineffective, we may make our concerns known publicly.