New Perspective Fund Seeks Shareholder Approval for Board Elections, Fee Changes

New Perspective Fund DEF 14A Filing Summary
FieldDetail
CompanyNew Perspective Fund
Form TypeDEF 14A
Filed DateSep 9, 2025
Risk Levelmedium
Pages15
Reading Time18 min
Key Dollar Amounts$1.70
Sentimentmixed

Sentiment: mixed

Topics: Shareholder Meeting, Proxy Statement, Fund Governance, Advisory Fees, Diversification Change, Investment Company Act of 1940, Capital Group

TL;DR

**Vote FOR these proposals; they're streamlining fees and governance, but watch TEFNY's risk profile if it goes non-diversified.**

AI Summary

New Perspective Fund, alongside other American Funds and Capital Group ETFs, is holding a special shareholder meeting on November 25, 2025, to address three key proposals. Shareholders will vote to elect Board members, a necessary step as it has been several years since the last election and changes in Board composition necessitate new elections to maintain the two-thirds shareholder-elected ratio required by the 1940 Act. Additionally, ten bond funds, including American Funds Mortgage Fund and The Bond Fund of America, are seeking approval to amend their Investment Advisory and Service Agreements to transition from a fee schedule with both asset and income components to an asset-only advisory fee schedule. This change aims to stabilize fees for investors, eliminating potential increases during dynamic interest rate environments. Lastly, American Funds Tax-Exempt Fund of New York (TEFNY) proposes to change its classification from a 'diversified' to a 'non-diversified' fund, granting its investment adviser, Capital Research and Management Company (CRMC), greater investment flexibility, though this introduces additional risks as detailed in Proposal 3. The Boards of all affected Funds unanimously recommend voting 'FOR' all proposals, believing them to be in the best interests of shareholders.

Why It Matters

This DEF 14A filing is crucial for investors as it outlines significant governance and fee structure changes across a broad range of American Funds and Capital Group ETFs. The election of Board members ensures proper oversight and adherence to regulatory requirements, directly impacting fund management. The proposed shift to an asset-only advisory fee for ten bond funds could provide greater fee predictability for investors, especially in volatile interest rate markets, potentially making these funds more attractive compared to competitors with variable fee structures. For TEFNY shareholders, the reclassification to 'non-diversified' offers increased investment flexibility for CRMC but also introduces higher risk, demanding careful consideration of the fund's future risk profile and competitive positioning within the municipal bond market.

Risk Assessment

Risk Level: medium — The risk level is medium due to the proposed reclassification of American Funds Tax-Exempt Fund of New York (TEFNY) from 'diversified' to 'non-diversified.' This change, while offering greater investment flexibility to Capital Research and Management Company (CRMC), inherently increases the fund's concentration risk, as non-diversified funds are not subject to the 1940 Act's 5% issuer limit for 75% of assets. This means TEFNY could hold more than 5% of its total assets in a single issuer, or more than 10% of an issuer's voting securities, exposing investors to higher potential volatility and specific issuer risk.

Analyst Insight

Investors should carefully review the specific proposals, particularly the fee schedule changes for the ten bond funds and the diversification reclassification for TEFNY. While the Board recommends 'FOR' all proposals, TEFNY shareholders should assess if the increased investment flexibility justifies the higher concentration risk associated with a non-diversified classification, and consider if it aligns with their personal risk tolerance and investment objectives.

Key Numbers

  • 2025-09-09 — Filing Date (Date the DEF 14A was filed)
  • 2025-11-25 — Shareholder Meeting Date (Date of the Joint Special Meetings of Shareholders)
  • 2025-08-28 — Record Date (Date for determining shareholders entitled to vote)
  • 3 — Number of Proposals (Total number of proposals to be voted upon by shareholders)
  • 10 — Number of Bond Funds (Number of bond funds proposing investment advisory fee schedule changes)
  • $1.70 — Estimated Cost Per Shareholder Account (Average estimated cost for obtaining shareholder approval of proposals)
  • 9:00 a.m. Pacific Time — Meeting Time (Scheduled start time for the Joint Special Meetings of Shareholders)
  • 888-615-7476 — Computershare Contact Number (Phone number for shareholder assistance with voting)
  • 67% — Majority Vote Threshold (Option A) (Required affirmative vote for proposals 2 and 3 if more than 50% of outstanding voting securities are present)
  • 50% — Majority Vote Threshold (Option B) (Required affirmative vote for proposals 2 and 3 based on outstanding voting securities)

Key Players & Entities

  • NEW PERSPECTIVE FUND (company) — Registrant filing DEF 14A
  • Michael W. Stockton (person) — Executive Vice President of the Funds
  • Capital Group (company) — Host of special shareholder meetings
  • American Funds (company) — Group of funds involved in proxy statement
  • Capital Research and Management Company (company) — Investment adviser for TEFNY
  • Computershare Fund Services (company) — Company hired to assist with shareholder meetings and collect votes
  • American Funds Tax-Exempt Fund of New York (company) — Fund proposing diversification classification change
  • SEC (regulator) — Regulates DEF 14A filings
  • Jennifer L. Butler (person) — Secretary of the Boards of the Funds
  • Courtney R. Taylor (person) — Secretary of the Boards of the Funds

FAQ

What are the key proposals for the New Perspective Fund shareholder meeting on November 25, 2025?

The key proposals for the New Perspective Fund shareholder meeting on November 25, 2025, include the election of Board members, the approval of an amendment to the Investment Advisory and Service Agreement to modify fee schedules for ten bond funds, and the approval of a change in American Funds Tax-Exempt Fund of New York's classification from 'diversified' to 'non-diversified.'

Why is New Perspective Fund electing Board members now?

New Perspective Fund is electing Board members now because it has been several years since the last shareholder meeting for Board elections, and subsequent changes in Board composition necessitate new elections. This ensures that at least two-thirds of the Board members are elected by shareholders, as required by the Investment Company Act of 1940, and allows the Boards to add new members for a longer period without incurring additional shareholder meeting expenses.

Which funds are affected by the proposed investment advisory fee schedule changes?

The proposed investment advisory fee schedule changes affect American Funds Mortgage Fund, American High-Income Trust, The Bond Fund of America, U.S. Government Securities Fund, Intermediate Bond Fund of America, American High-Income Municipal Bond Fund, Limited Term Tax-Exempt Bond Fund of America, The Tax-Exempt Bond Fund of America, The Tax-Exempt Fund of California, and American Funds Tax-Exempt Fund of New York.

What is the purpose of changing the fee structure for the ten bond funds?

The purpose of changing the fee structure for the ten bond funds is to transition from an advisory fee schedule with both asset and income components to an asset-only advisory fee schedule. This aims to create stability and consistency in fees for investors, eliminating the potential for higher advisory fees during periods of rising or higher interest rates.

What does it mean for American Funds Tax-Exempt Fund of New York to change from 'diversified' to 'non-diversified'?

Changing American Funds Tax-Exempt Fund of New York's classification from 'diversified' to 'non-diversified' means it will no longer be subject to certain regulatory limits under the 1940 Act. Specifically, it will not be restricted to investing no more than 5% of its total assets in securities of any one issuer or holding more than 10% of the outstanding voting securities of any one issuer for 75% of its total assets, granting its adviser, CRMC, greater investment flexibility but also introducing additional risks.

What are the risks associated with American Funds Tax-Exempt Fund of New York becoming a 'non-diversified' fund?

The risks associated with American Funds Tax-Exempt Fund of New York becoming a 'non-diversified' fund include increased concentration risk. Without the 1940 Act's diversification limits, the fund can invest a larger portion of its assets in a smaller number of issuers, making it more susceptible to the specific risks and performance fluctuations of those individual investments.

What is the Board's recommendation for the proposals in the New Perspective Fund proxy statement?

The Board of each Fund, including New Perspective Fund, unanimously recommends that shareholders vote 'FOR' proposals 1, 2, and 3, believing that each proposal is in the best interests of shareholders.

What happens if the proposals are not approved by New Perspective Fund shareholders?

If there are not enough votes to approve a proposal for a Fund, the meeting may be adjourned to solicit further proxy votes. If a proposal is ultimately not approved (other than for EMEF or EUPAC), the Fund will continue to operate as it currently does. If Proposal 1 for EMEF or EUPAC is not approved, their current trustees will continue to serve.

How much will the shareholder approval process cost the Funds?

The expenses associated with obtaining shareholder approval of the proposals, including printing, mailing, and proxy solicitation, are estimated to average approximately $1.70 per shareholder account across all Funds, and these costs will be borne by the Funds.

Who is Capital Research and Management Company (CRMC) in relation to these proposals?

Capital Research and Management Company (CRMC) is the investment adviser for American Funds Tax-Exempt Fund of New York (TEFNY). CRMC believes that changing TEFNY's classification to a non-diversified fund will benefit TEFNY by giving it greater investment flexibility.

Risk Factors

  • 1940 Act Compliance for Board Elections [medium — regulatory]: The Investment Company Act of 1940 requires that at least two-thirds of a fund's Board members be elected by shareholders. Failure to maintain this ratio necessitates shareholder meetings for elections, which can incur costs. The current proposal aims to elect new board members to ensure compliance and avoid future expenses.
  • Diversified vs. Non-Diversified Fund Classification [medium — regulatory]: Proposal 3 involves changing American Funds Tax-Exempt Fund of New York (TEFNY) from a 'diversified' to a 'non-diversified' fund. Diversified funds have restrictions under the 1940 Act, limiting investments in any single issuer to 5% of assets or 10% of voting securities. Non-diversified funds lack these limits, offering more flexibility but introducing additional investment risks.
  • Interest Rate Volatility Impact on Fees [medium — market]: Ten bond funds are proposing to move from a fee schedule with both asset and income components to an asset-only schedule. The current structure can lead to fee variability, particularly during dynamic interest rate environments. The proposed change aims to stabilize fees for investors.

Industry Context

The mutual fund industry, particularly within the American Funds and Capital Group families, is subject to significant regulatory oversight under the Investment Company Act of 1940. Key trends include adapting to market volatility, such as fluctuating interest rates, and ensuring robust corporate governance through regular board elections. The shift towards greater investment flexibility for certain funds, while balancing investor risk, is a common strategic consideration.

Regulatory Implications

The proposals directly engage with the Investment Company Act of 1940. Proposal 1 addresses board composition requirements, while Proposal 3 involves a change in fund classification that alters regulatory investment limitations. These actions require shareholder approval to ensure compliance and adapt to evolving fund management strategies.

What Investors Should Do

  1. Review the Joint Proxy Statement carefully to understand the three proposals being voted on.
  2. Vote 'FOR' all three proposals as recommended by the Boards of Directors/Trustees, who believe they are in the best interests of shareholders.
  3. Submit your vote by proxy using the phone, internet, or mail by the deadline to ensure your voice is heard, as attendance at the meeting is not required.
  4. Contact Computershare at 888-615-7476 if you have any questions or require assistance with voting.

Key Dates

  • 2025-09-09: Filing Date — This is the date the DEF 14A proxy statement was officially filed with the SEC, marking the formal commencement of the proxy solicitation process for the upcoming shareholder meeting.
  • 2025-08-28: Record Date — Shareholders as of this date are entitled to receive notice of and vote at the special shareholder meeting, establishing the eligible voting base.
  • 2025-11-25: Shareholder Meeting Date — The date on which shareholders will vote on the proposed resolutions, including the election of board members and changes to investment advisory agreements and fund classifications.

Glossary

DEF 14A
A filing with the U.S. Securities and Exchange Commission (SEC) that provides shareholders with information about matters to be voted on at a shareholder meeting, including proposals, board recommendations, and voting procedures. (This document is the primary source of information for shareholders to understand the proposals and cast their votes.)
Investment Company Act of 1940 (1940 Act)
A U.S. federal law that regulates the organization and operation of mutual funds and other investment companies. It includes provisions related to board composition, shareholder voting, and fund classifications. (Key provisions of the 1940 Act are directly relevant to Proposal 1 (board elections) and Proposal 3 (fund classification).)
Diversified Fund
Under the 1940 Act, a diversified investment company has restrictions on its investments. For 75% of its assets, it cannot invest more than 5% of its total assets in securities of any one issuer, nor can it hold more than 10% of the outstanding voting securities of any one issuer. (Proposal 3 involves changing American Funds Tax-Exempt Fund of New York from a diversified to a non-diversified status, which will alter its investment flexibility and risk profile.)
Non-Diversified Fund
An investment company that does not meet the strict diversification requirements of the 1940 Act. These funds have greater flexibility in concentrating their investments in fewer issuers or larger positions. (This is the proposed new classification for American Funds Tax-Exempt Fund of New York, allowing its investment adviser greater flexibility.)
Investment Advisory and Service Agreement
A contract between an investment company (like a fund) and its investment adviser, outlining the services to be provided and the fees to be paid. (Proposal 2 seeks to amend this agreement for ten bond funds to change the fee structure from an asset and income component to an asset-only component.)

Year-Over-Year Comparison

This filing pertains to a special shareholder meeting and does not provide comparative financial data from a previous year's annual report. The key focus is on upcoming voting matters rather than a review of past financial performance. Therefore, a comparison of revenue growth, margin changes, or new risks against a prior period is not applicable in this context.

Filing Stats: 4,405 words · 18 min read · ~15 pages · Grade level 13.7 · Accepted 2025-09-09 16:17:58

Key Financial Figures

  • $1.70 — average across all Funds approximately $1.70 per shareholder account. How many vote

Filing Documents

– The Proposals

Part I – The Proposals     Proposal 1 – To elect Board members of the Funds   3 Proposal 2 – To approve the proposed amendment of the Investment Advisory and Service Agreement to modify the investment advisory and service fee schedule for each of American Funds Mortgage Fund, American High -Income Trust, The Bond Fund of America, U.S. Government Securities Fund, Intermediate Bond Fund of America, American High -Income Municipal Bond Fund, Limited Term Tax -Exempt Bond Fund of America, The Tax -Exempt Bond Fund of America, The Tax -Exempt Fund of California, and American Funds Tax -Exempt Fund of New York   8 Proposal 3 – To approve the proposed change to the diversification classification for American Funds Tax -Exempt Fund of New York from a diversified to a non -diversified registered investment company   13 Part II     Additional Information about the Funds   15 Audit Committee   16 Further Information About Voting and the Shareholder Meetings   17 EXHIBITS     Exhibit A – Series and Included Fund(s )     Exhibit B – Form of Nominating and Governance Committee Charte r     APPENDICES     Appendix 1 – Board Member and Nominee Informatio n     Appendix 2 – Board and Committee Meetings; Committee Compositio n     Appendix 3 – Board Member Compensation and Fund Ownershi p     Appendix 4 – Executive Officer s     Appendix 5 – Total Shares Outstandin g     Appendix 6 – Principal Beneficial Holder s     Appendix 7 – Independent Auditors and Related Fee s     Appendix 8 – Comparison of Current and Proposed A

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