Fees as high as 25 cents an email to send mass correspondence to investors are riling executives at public companies and mutual funds and putting a spotlight on the power of an obscure but lucrative Wall Street utility, Broadridge Financial Solutions.
Headquartered in suburban Lake Success, New York, Broadridge has emerged as the dominant third-party vendor for distributing prospectuses, shareholder reports and proxy materials on behalf of brokers, handling more than 80 per cent of the business. The mailings reach more than 140m investor accounts, the company said in a 2018 letter to the US Securities and Exchange Commission.
Broadridge “provides the critical infrastructure that powers investing”, according to its website. Yet critics say that its investor communications services come at a high price.