What it means
Most investors do not hold shares in their own name. Instead, a broker or bank holds them on the investor's behalf in what is called street name (registered in the broker's name, not the investor's).
The investor is the beneficial owner, meaning the person who enjoys the benefits of ownership, while the broker appears on the company's register. Because the company's register shows only the broker, the company does not automatically know who its real shareholders are.
Securities rules in markets such as the United States and Canada therefore let a company ask brokers for a list of investors who do not object to being identified. These investors are NOBOs, and they are normally contacted directly with annual reports, voting materials and other communications.
Investors who prefer privacy can object, and they are called objecting beneficial owners, or OBOs. Their details stay with the broker, and company mailings reach them through the broker as an intermediary.
The choice is usually made when the account is opened and can often be changed later. For companies, a high share of NOBOs is valuable.
It allows them to see who owns their shares, to send information straight to those investors and to run campaigns that encourage shareholders to vote. Without that list, the company must go through brokers for every mailing, which is slower and less targeted.
For the investor, being a NOBO is mainly a matter of convenience and privacy. Being on the list does not create extra obligations, and it does not change your legal rights as an owner.
It means only that the company may know who you are and how many shares you hold. A practical point is that the lists are for communicating with shareholders, not for general marketing.
Rules limit how the information can be used, and companies are expected to keep it secure. Managers who receive a NOBO list should treat it as confidential data and handle it according to the relevant regulations.
In practice
Real-world examples.
Example
A mid-sized manufacturer asks its brokers for a NOBO list before its annual meeting. The list shows 4,200 individual investors who hold shares in street name. The investor relations team mails voting materials directly to them and sees turnout rise. The finance director notes that the extra cost of mailing is small compared with the cost of a failed vote.
Example
A retired teacher holds shares through her online brokerage account. When opening the account she ticks a box saying she does not object to sharing her details with companies. As a NOBO, she receives annual reports directly from the companies whose shares she owns. She says she prefers hearing directly from the company and has never found the arrangement intrusive.
Example
A private investor with a large holding in a small company prefers that his stake remain confidential. He tells his broker that he objects to disclosure, making him an OBO. The company can still send him documents through the broker, but it cannot see his name. He accepts that this makes it harder for the company to reach him quickly, so he checks his broker's emails for company news.
Case study
Seen in the real world.
Greenfield Logistics is a fictional transport company that faced a shareholder vote on a merger and needed at least 60% of shares to be voted. In this illustrative story, the company knew the names of only a few hundred registered holders, while most of its shares sat in street name. Its investor relations manager requested a list of NOBOs from the brokers and found that about 55% of the street-name shares belonged to NOBOs.
Using the list, the company mailed information directly to those investors and followed up by phone and email. Turnout rose from 48% in the previous year to 67%, and the merger vote passed with a clear mandate. The manager noted that she could not contact the OBOs directly and had relied on brokers for them, which was slower and gave her less control over timing.
The experience changed how Greenfield handled investor communication. It now asks brokers for an updated NOBO list ahead of every meeting and encourages investors to choose NOBO status when they open new accounts. The investor relations team also reports the share of NOBOs to the board each year, as a simple measure of how well the company can reach its owners.
Watch out
Common mistakes.
- Assuming NOBOs are the same as registered holders. NOBOs hold through a broker, but they permit disclosure of their details.
- Thinking a NOBO gives up voting rights. Disclosure does not change the investor's rights as an owner.
- Treating a NOBO list as a marketing database. The information is for shareholder communications, and rules restrict other uses.
Questions
People also ask.
What is the difference between a NOBO and an OBO?
A NOBO allows the broker to share their identity with the company, while an OBO asks that it be withheld.
Can I change my status?
Often yes, by contacting your broker and updating your preference on the account.
Why do companies want NOBO lists?
They let the company contact its real shareholders directly, which helps with communication and voting.
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