CVM Meaning and
Definition
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CVM, an acronym for Cumulative Voting Method, refers to a voting system that allows shareholders to distribute their votes unequally among multiple candidates in an election. In this method, a participant is allocated a number of votes equal to the number of candidate positions to be filled, and they can distribute those votes among the candidates as they see fit. Shareholders are not limited to one vote per candidate, which differentiates cumulative voting from the more common plurality voting system.
This approach provides minority shareholders with an opportunity to have a larger influence in the election of directors or other positions in a company or organization. By pooling their votes behind a single candidate, minority shareholders can increase their chances of electing a representative who aligns with their interests. CVM can be particularly advantageous when there is a lack of proportional representation within a board or when specific perspectives or minority opinions need to be heard.
The method gets its name from the cumulative nature of the voting process. Shareholders can accumulate their votes and cast them all for a single candidate or distribute them across multiple candidates. The cumulative voting formula is calculated by multiplying the number of shares owned by the number of candidates being elected, giving shareholders the ability to exert a greater influence on the election outcome.
CVM is commonly used in corporate governance, especially in companies with distinct shareholder groups or when there is a desire to ensure diverse representation within a board of directors.
Common Misspellings for CVM
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