The European Commission is now deciding how far the review of the Shareholder Rights Directive should go. The choice is not whether to refine SRD II, but whether SRD III will address the operational constraints that still determine whether shareholders can vote across borders.

On 6 May 2026, Minerva submitted our views to the Commission’s call for evidence on SRD III. The submission makes a simple point that Europe has largely harmonised how voting information moves through the system, and what remains fragmented is the authority and infrastructure behaviour that determines whether those messages can be acted on in time. That is the gap between formal rights and usable ones.

What is the SRD II Review?

In February 2026, the European Commission formally opened the review of the Shareholder Rights Directive, launching a Call for Evidence on whether the current framework is delivering effective shareholder rights in a fragmented, digital, and increasingly cross border market. The review sits within the Savings and Investments Union agenda and follows successive ESMA, OECD and Commission assessments concluding that, despite SRD II being fully applicable since 2020, material obstacles persist in the intermediary chain, particularly around authority, cut offs, and cross border voting costs.

The participation gap is operational, not legal

Minerva’s evidence shows that Europe continues to underperform on shareholder participation despite SRD II being fully in force. The median European “action window”, the working days between receipt of meeting materials and the effective voting cut-off, is 14.5 days. In North America it is 25 days. Several major EU markets, including Italy, Austria and Portugal, sit well below the European median.

That gap is not explained by statute. It reflects how the voting chain operates in practice.

The submission’s central finding is that most voting failures now occur in areas the Directive does not bind directly such as discretionary cut‑offs imposed by Central Securities Depositories (CSDs) and platforms, and fragmented national power‑of‑attorney regimes. These are not technical limitations but instead reflect commercial and legal choices layered on top of harmonised rights.

Authority, not messaging, is the binding constraint

SRD II materially improved the messaging layer of the system, with meeting information now more standardised and quickly transmitted than ever.

What it did not address is the legal authority by which an asset manager or custodian is empowered to act on a holding across borders. In operational terms, authority determines whether voting can be handled through standing arrangements or whether each meeting triggers bespoke documentation that consumes much of the available window.

There are still twenty-seven national approaches to standing authority. Some jurisdictions require notarisation, apostilles or per-meeting documentation. Others, notably Ireland and the UK, recognise standing corporate representative authority in statute and remove most of that friction. The difference in outcomes is visible in Minerva’s data.

Cut‑off discretion is where rights compress

The second bottleneck is cut‑off discretion. In many EU markets, the effective deadline for investors is not the issuer deadline and not one set by law. It is a commercial cut‑off imposed by a CSD or platform, often several business days earlier.

Minerva’s submission shows that operational benchmarks support a one-hour offset, making multi-day buffers difficult to justify.

This is where shareholder rights are shortened in practice. Two investors holding the same security can face different voting outcomes depending on routing, even within the same market. Consolidation in the voting chain has reinforced this dynamic by concentrating deadline‑setting while leaving the cost of lost votes with shareholders, not infrastructure providers.

What SRD III could change

Minerva’s submission argues that SRD III should target these constraints directly. It proposes a harmonised EU regime for standing authority, modelled on the Irish and UK approach, and regulatory discipline on cut-off discretion that binds CSDs, exchanges and platforms, not only issuers.

There are reasons the Commission may be cautious. Standing authority touches national legal formality, and infrastructure deadlines are usually framed as risk controls. Enforcement would need to shift toward the operational layer of the market.

But the evidence suggests incremental changes to messaging and disclosure will not close the participation gap. The remaining constraints are structural.

Definitions and accountability

SRD III is also an opportunity to realign regulation with how stewardship is delivered. The current “proxy advisor” definition captures very different services, while fund regulation remains largely silent on stewardship as a regulated activity. The result is inconsistent treatment and unclear accountability.

An activity-based, technology neutral approach, combined with conforming changes to AIFMD, UCITS and MiFID II, would better align responsibility with influence over voting outcomes.

The practical test

The test for SRD III is practical. If it harmonises standing authority and constrains discretionary cut‑offs at the infrastructure level, cross‑border voting should become more predictable and scalable. If it does not, Europe will continue to offer shareholder rights that exist clearly in law but remain difficult to exercise in practice.

‍