In a Blow to Open-Endedness, New Germany Fund Vote Re-elects Incumbant Directors (GF)

The shareholders of the New Germany Fund (GF) have spoken, but it’s not clear what they said. Final results of the contested shareholder meeting have been made available, and according to the press release the incumbent directors were re-elected, and the proposals to terminate the investment advisory agreement and override the director qualification bylaw were defeated.

However, of the contested issues, the one that received the most support was the open-ending proposal, which was approved by a majority of the votes cast. The interesting thing is that over 1 million more votes were cast in favor of open-ending the fund, than were voted in favor of any of the incumbent directors.

The logical move for shareholders who were in favor of open-ending would have been to support the dissidents’ director nominees, and for those who were against open-ending to vote for the incumbent nominees. In this case it appears that there are many shareholders who support open-ending GF, but for some reason chose not to vote for the dissident nominees. So it is difficult to say what these shareholders really wanted. Based on statements made by the board, I do not expect to see any major changes made with the fund this year.

GF 1-yr chart: