Explanation

Michael Cane has violated the Standard relating to loyalty, prudence, and care for both reasons:

1. Proxy Voting Requirement

Under CFA Institute Standards of Professional Conduct, investment managers have a fiduciary duty to vote proxies in the best interests of their clients. The Standard III(A) - Loyalty, Prudence, and Care requires that members and candidates:

• Must vote proxies in a timely and responsible manner
• Must always act in the best interests of clients
• Cannot abstain from voting simply because they believe it doesn't benefit clients

Voting proxies is a fundamental responsibility of investment managers, as proxy votes can significantly impact shareholder value and corporate governance. The policy stating that "voting proxies may not be required in all instances if they do not benefit clients" directly violates this standard.

2. Disclosure Requirement

Under Standard V(B) - Communication with Clients and Prospective Clients, investment managers must:

• Disclose their proxy voting policies to clients
• Make this disclosure proactively, not just upon request
• Ensure clients understand how proxies will be voted on their behalf

By disclosing the proxy voting policy only upon request, Cane fails to meet the requirement for proactive disclosure.

Conclusion

Both aspects of Cane's policy violate CFA Institute Standards. Investment managers must:

1. Always vote proxies in the best interests of clients
2. Proactively disclose their proxy voting policies to all clients

Therefore, option C is correct - Cane has violated the Standard for both reasons.