For over a year Alliance Advisors has been working behind the scenes to lead the charge to convince the SEC to modernize the NOBO (Non-Objecting Beneficial Owner) and OBO (Objecting Beneficial Owner) framework. Modernizing the framework would allow public companies and mutual funds the ability to know and communicate with all their shareholders not just NOBO and registered shareholders.
Why this matters
The NOBO OBO framework was adopted in 1986 for a paper-based market structure that no longer exists. Since then, retail ownership U.S. companies have grown dramatically: brokerage accounts at the top ten firms have grown from approximately 11.5 million to 160 million. Using an average of six equity positions per brokerage account, shareholder-to-company positions have increased from roughly 69 million to approximately 960 million.
The current U.S. system continues to restrict issuers’ ability to identify and communicate with a significant portion of their investors. The OBO classification imposes substantial costs and inefficiencies on issuers, funds, and ultimately investors. Because solicitation costs are driven by accounts rather than shares, this structure increases the cost of proxy solicitation, complicates shareholder outreach, and disproportionately burdens small and mid-sized issuers.
Coalition History
On multiple occasions we have met with Commissioners, Directors, and senior legal staff across multiple divisions of the SEC to discuss the need to overhaul the U.S. shareholder communications framework.
Our discussions with the SEC have been constructive, and there appears to be receptivity to revisiting the OBO designation. Importantly, the Commission has indicated that a coordinated effort supported by a broad coalition of market participants, including issuers, asset managers, intermediaries, and trade organizations, would be instrumental in advancing meaningful reform.
Supporting Resources
Modernizing Shareholder Communication – A Policy Review of the OBO/NOBO Framework in U.S. Public Markets. May 2026
Introduction Transparency is a foundational value of the United States that is embedded in our democratic institutions, our legal system,…
Modernizing Shareholder Communications: Executive Survey on the OBO/NOBO Framework
Leveling the Playing Field for American Companies by Removing Barriers to Shareholder Access Survey Findings on Shareholder Communications Reform Purpose…
We Need Your Support
We have gotten an overwhelming positive response to the idea of modernizing the NOBO OBO framework. Our coalition is growing and we have $4 trillion in assets on the fund side, issuers of all sizes on board, transfer agents and various trade organizations.
We believe your company’s participation would be highly valuable to this effort. Please be advised that there would be no financial commitment or time commitment on your part, Alliance Advisors will cover any costs and document work needed.
Alliance Advisors will provide all coalition participants with a draft of the letter we propose to send to the SEC and give all participants the opportunity to opt out before any letter is presented.
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