WestEnd Advisors ("WestEnd") is an investment advisor providing discretionary equity and fixed-income portfolio management services to corporations, retirement plans, endowment funds and foundations, individuals with substantial net worth, and financial institutions such as trust companies and bank trust departments (collectively, "Clients"). Unless a Client specifically directs otherwise in writing, the investment management agreements generally authorize WestEnd to vote proxies on behalf of Clients pursuant to WestEnd's fiduciary obligations and the policies and procedures described below.
Under the Investment Advisers Act of 1940 ("Advisers Act"), the Employment Retirement Income Security Act of 1974 ("ERISA"), and other relevant laws and regulations, an investment advisor owes its Clients the duty of care and loyalty in providing advisory services, including the voting of proxies. WestEnd takes seriously its legal and fiduciary obligations concerning the voting of proxies and has adopted and implemented policies and procedures to ensure that it votes proxies in a manner consistent with the best interests of its Clients.
In determining the best interests of its Clients, WestEnd may obtain information from third parties concerning their recommendations on particular proxy issues. WestEnd engages the services of RiskMetrics Group (RMG) to provide both proxy administration services and voting recommendations. WestEnd neither relies on the advice of RMG nor delegates to them the authority to decide how any proxy will be voted. WestEnd reviews all recommendations prior to voting taking place and may choose to accept or reject any recommendation made by RMG based on the particular facts and circumstances surrounding any proxy issues.
WestEnd has adopted RMG's U.S. Proxy Voting Guidelines, a summary of which follows these procedures.
CLIENT GUIDELINES
Clients may have their own set of proxy voting guidelines, which may conflict with the proxy guidelines discussed above or the voting guidelines of another Client. If such a situation arises, it is the policy of WestEnd to comply with Client guidelines by voting the proxies attributable to that Client on a proportionate basis (based on the number of shares held by the Client).
PROCEDURES
WestEnd maintains operational procedures that include, but are not limited to: (1) disclosing proxy voting procedures to clients; (2) notifying custodians of new accounts to ensure proxy materials are forwarded to the appropriate location; (3) notifying RiskMetrics Group to ensure proxy materials are properly received; and (4) the handing of proxies in the event that proxy materials are received in paper format by WestEnd.
CONFLICTS OF INTEREST
WestEnd's proxy voting policies and procedures are designed to ensure that proxies are properly voted, material conflicts are avoided, and fiduciary obligations are fulfilled. Neither WestEnd nor any person involved in the proxy voting process is engaged in any material business other than managing assets and providing investment advisory services for clients. Therefore, it is highly unlikely that any proxy considered by WestEnd will result in a material conflict of interest between any client and WestEnd. In the unlikely event that a proxy is not addressed by the guidelines above, and materially conflicts with the interests of WestEnd or any person involved in the proxy voting process, WestEnd will contact the client and follow the client's instruction with respect to the voting of that proxy.
FOREIGN INVESTMENTS
On occasion, WestEnd may invest Client assets in foreign securities. Given the complexity and variety of regulatory schemes and corporate practices in foreign countries, there may be excessive costs associated with voting proxies for foreign securities. Consistent with applicable law and regulations, if the costs of exercising a proxy vote on a proposal exceed the expected benefits to a Client's account, West End may choose not to vote that proxy proposal.
RECORDKEEPING
WestEnd will maintain:
- the Proxy Voting Policies and Procedures;
- all proxy statements received by WestEnd in connection with Client securities, if not readily available through a third-party service provider or through the Securities and Exchange Commission's Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system;
- a record of how WestEnd voted each proxy;
- a record of all written Client requests for proxy voting information and WestEnd's response to those requests; and
- any other documents prepared by WestEnd that were material to the voting decision.
WestEnd Advisors, LLC
Two Morrocroft Centre
4064 Colony Road Suite 130
Charlotte, NC 28211