On the day of Microsoft’s annual meeting, shareholders voted against a proposal that would have encouraged the company to consider adding Bitcoin to its balance sheet. The proposal, put forward by the National Center for Public Policy Research, suggested that given rampant inflation, companies have an obligation to protect their profits from depreciation by diversifying their investments, potentially including assets like Bitcoin.
The proposal highlights the underperformance of traditional assets such as U.S. government securities and corporate bonds compared to Bitcoin’s significant appreciation. The proposal cites Bitcoin’s 99.7% increase in price over the past year and a 414% increase over five years, outperforming corporate bonds by a significant margin. The recommendation is to consider including Bitcoin to protect shareholder value from inflation.
Microsoft’s board opposed the proposal, explaining that the company’s management has conducted a thorough evaluation of investable assets, including cryptocurrencies, to ensure liquidity and operational funding. The board emphasized the importance of stable and predictable investments for the company’s treasury applications, given the volatility of cryptocurrencies.
The board further stated that Microsoft’s Global Treasury and Investment Services team continues to monitor cryptocurrency trends and developments to inform future decisions. According to the board, Microsoft has a robust process for managing and diversifying its treasury, aimed at the long-term benefit of shareholders, so the proposed public valuation is not necessary.
The rejection of the proposal shows that Microsoft’s shareholders and board of directors share a cautious approach to cryptocurrencies as part of the company’s investment strategy. Despite the potential for higher returns, the company prioritizes stability and risk management in its asset allocation decisions.
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