The UK National Association of Pension Funds (NAPF) has launched an independent inquiry into the shareholder voting practices of pension funds and other institutional investors after investigations found that only 40% were having their votes registered.

And the NAPF has said the enquiry could be an example to companies in Europe where corporate governance is still very much in its infancy.

The enquiry, which is being headed up by Yve Newbold, a partner in law firm Heidick and Struggles and former company secretary at Hanson, will publish its findings in June 1999.

It will focus on the effectiveness of current voting mechanisms and an analysis of intended votes, which the NAPF believes may identify communication glitches between pension funds, fund managers, custodians, registrars and companies.

Ann Robinson, director general of the NAPF, said: We are setting up this enquiry against a background of increasing UK government pressure for pension funds and their managers to use their votes at company meetings, and warnings of possible compulsory voting legislation.

"Other European countries, particularly France and the Netherlands, will undoubtedly be looking to the inquiry's findings as they begin to address the same corporate governance issues.""

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