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[logo - American Funds (r)]
The right choice for the long term (SM)
The Investment
Company of America (r)
Annual Meeting of shareholders -- August 11, 2005
IMPORTANT NOTICE
The annual meeting of shareholders of The Investment Company of America will
take place on August 11, 2005.
You don't need to attend the meeting to participate. But it's important that you
take a few minutes to read the enclosed material and vote your shares. You can
vote by the Internet, by telephone or by mailing your completed and signed proxy
card(s) in the enclosed postage-paid envelope. Unless you plan to attend the
meeting in person, you must respond in one of these ways in order for your vote
to be counted.
No matter how many shares you own, your vote is important. We encourage you to
read the attached Proxy Statement in full. Mutual funds are required to obtain
shareholders' approval for certain issues. As a shareholder, you have a right to
vote on these issues.
PLEASE DON'T HESITATE. VOTE YOUR SHARES TODAY. YOUR PROMPT RESPONSE WILL HELP
REDUCE PROXY COSTS -- WHICH ARE PAID FOR BY THE FUND -- AND WILL ALSO HELP YOU
AVOID RECEIVING FOLLOW-UP TELEPHONE CALLS OR MAILINGS. VOTING BY THE INTERNET OR
TELEPHONE LOWERS PROXY COSTS EVEN FURTHER.
IMPORTANT VOTING INFORMATION INSIDE.
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The Investment Company of America
NOTICE OF MEETING OF SHAREHOLDERS
AUGUST 11, 2005
TO THE SHAREHOLDERS OF THE INVESTMENT COMPANY OF AMERICA:
The annual meeting of shareholders of The Investment Company of America (the
"fund") will be held at the Hotel du Pont, 11th and Market Streets, Wilmington,
Delaware, on Thursday, August 11, 2005 at 9:00 a.m., local time, to consider and
vote on the following matters described under the corresponding numbers in the
accompanying Proxy Statement:
1. The election of a Board of 13 Directors.
2. To consider and act upon any other business as may properly come before the
meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on June 13, 2005 as the
record date for the determination of shareholders entitled to notice of and to
vote at the meeting or any adjournment thereof.
THE PROPOSED BUSINESS CANNOT BE CONDUCTED AT THE MEETING UNLESS THE HOLDERS OF A
MAJORITY OF THE SHARES OF THE FUND OUTSTANDING ON THE RECORD DATE ARE PRESENT IN
PERSON OR BY PROXY. THEREFORE, PLEASE MARK, SIGN, DATE AND RETURN THE ENCLOSED
PROXY CARD OR CAST YOUR VOTE BY TELEPHONE OR THE INTERNET. YOU MAY REVOKE IT AT
ANY TIME BEFORE ITS USE. IF YOU OWNED SHARES IN MORE THAN ONE CLASS OF THE FUND
AS OF THE RECORD DATE OF JUNE 13, 2005, YOU MAY RECEIVE MORE THAN ONE PROXY
CARD. PLEASE BE CERTAIN TO VOTE EACH PROXY CARD YOU RECEIVE.
By order of the Board of Directors,
Vincent P. Corti
Secretary
June 23, 2005
IMPORTANT
You can help the fund avoid the expense of follow-up letters to ensure a quorum
by promptly voting your shares by mail, telephone or the Internet. If voting by
mail, please mark, sign, date and return the enclosed proxy card(s). The
enclosed envelope requires no postage if mailed in the United States. To vote by
telephone or the Internet, please follow the instructions that appear on the
enclosed insert.
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The Investment Company of America
333 South Hope Street, Los Angeles, California 90071
PROXY STATEMENT
ANNUAL MEETING OF SHAREHOLDERS
AUGUST 11, 2005
The enclosed proxy is solicited by the Board of Directors of the fund in
connection with the meeting of shareholders to be held at the Hotel du Pont,
11th and Market Streets, Wilmington, Delaware, on Thursday, August 11, 2005 at
9:00 a.m., local time. As discussed more fully below, shareholders of the fund
are being asked to vote on a proposal to elect 13 directors. The Board knows of
no business other than the election of directors that will be presented for
consideration at the annual meeting. If any other matter is properly presented,
it is the intention of the persons named in the enclosed proxy to vote in
accordance with their best judgment.
If you complete, sign and mail the enclosed proxy card in the postage-paid
envelope provided or record your vote via telephone or the Internet in time to
be voted at the meeting, your shares will be voted exactly as you instruct. If
you simply sign the proxy card, without otherwise completing it, your shares
will be voted "for" the below nominated directors. Your vote can be revoked at
any time before its exercise, either by filing with the fund a written
notification of revocation, by delivering a duly executed proxy card or a
telephonic or Internet vote bearing a later date, or by attending the meeting
and voting in person. All shares that are voted and votes to "withhold" are
treated as being present at the meeting for purposes of obtaining the quorum
necessary to hold the meeting, as will broker "non-votes" (i.e. proxies received
from brokers or nominees indicating that they have not received instructions
from the beneficial owner or other person entitled to vote shares). However,
broker non-votes are not counted as part of the vote necessary to approve the
proposals. This Proxy Statement and proxy card was first mailed to shareholders
on or about June 23, 2005.
The fund is a fully managed, diversified, open-end investment company that
issues multiple classes of shares. Each share class represents an interest in
the same investment portfolio of securities, but each class has its own sales
charge and expense structure (please refer to the fund's prospectus for more
information). Shares of all classes of the fund vote together on matters that
affect all classes in substantially the same manner. There is no provision for
cumulative voting and the number of shares outstanding equals the number of
votes to which each respective class is entitled. At the close of business on
June 13, 2005, the record date fixed by the Board of Directors for determination
of shareholders entitled to notice of and to
The Investment Company of America 1
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vote at the meeting, the outstanding share balances for the various classes of
shares were as follows:
<Table>
<Caption>
CLASS SHARES OUTSTANDING CLASS SHARES OUTSTANDING
- -----------------------------------------------------------------------------------------
A 2,106,357,001 529-E 998,841
- -----------------------------------------------------------------------------------------
B 121,263,755 529-F 200,242
- -----------------------------------------------------------------------------------------
C 90,842,352 R-1 883,804
- -----------------------------------------------------------------------------------------
F 40,392,169 R-2 13,507,761
- -----------------------------------------------------------------------------------------
529-A 23,143,964 R-3 18,722,666
- -----------------------------------------------------------------------------------------
529-B 5,515,492 R-4 6,451,960
- -----------------------------------------------------------------------------------------
529-C 6,918,063 R-5 46,715,672
- -----------------------------------------------------------------------------------------
</Table>
The 529 share classes are available only through CollegeAmerica to investors
establishing qualified higher education savings accounts. CollegeAmerica account
owners are technically not shareholders of the fund and accordingly, do not have
the rights of a shareholder, including the right to vote any proxies relating to
fund shares.
Attached as Appendix A is a table that identifies those investors who own of
record or are known by the fund to own beneficially 5% or more of any class of
its shares as of June 13, 2005.
With respect to the election of directors, assuming a quorum is present at the
meeting, the 13 nominees receiving the highest number of votes will be elected.
If sufficient votes are not received by the meeting date, the persons named as
proxies may propose one or more adjournments of the meeting in accordance with
applicable law, to permit further solicitation of proxies. The persons named as
proxies may vote all proxies in favor of such adjournment.
PROPOSAL 1: ELECTION OF DIRECTORS
Thirteen directors are to be elected at the meeting, each to hold office until
the next annual meeting and until a successor is elected and qualified. Each of
the nominees for director were elected by shareholders at their last Annual
Meeting in 2004. Paul G. Haaga, Jr., a director since 2002, and James F.
Rothenberg, a director since 2000, are not standing for re-election, however,
Mr. Rothenberg will continue to serve as President of the fund. Each of the
nominees has agreed to serve as director if elected. If any unforeseen event
prevents one or more of the nominees from serving as director, your votes will
be cast (unless you have elected to withhold authority as to the election of any
nominee) for the election of such person or persons as the Board of Directors
shall recommend. The table below sets forth certain information regarding the
nominees.
2 The Investment Company of America
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BOARD OF DIRECTORS
<Table>
<Caption>
NUMBER OF PORTFOLIOS
YEAR FIRST WITHIN THE FUND
POSITION ELECTED A COMPLEX(1)
WITH DIRECTOR OF PRINCIPAL OCCUPATION(S) OVERSEEN BY
NAME AND AGE THE FUND THE FUND DURING PAST FIVE YEARS DIRECTOR
- -----------------------------------------------------------------------------------------------------------------------------
"NON-INTERESTED" DIRECTORS
Louise H. Bryson Director 1999 Executive Vice President, 1
61 Distribution and Business
Development, Lifetime Television;
Director and former Chairman,
KCET -- Los Angeles (public
television station); former
Senior Vice President, FX
Networks LLC: Fox Inc.
- -----------------------------------------------------------------------------------------------------------------------------
Mary Anne Dolan Director 2000 Founder and President, 3
58 M.A.D., Inc. (communications
company); former Editor-in-Chief,
THE LOS ANGELES HERALD EXAMINER
- -----------------------------------------------------------------------------------------------------------------------------
Martin Fenton Chairman of 2000 Chairman of the Board and CEO, 16
70 the Board Senior Resource Group LLC
(development and management of
senior living communities)
- -----------------------------------------------------------------------------------------------------------------------------
Leonard R. Fuller Director 2002 President and CEO, Fuller 14
58 Consulting (financial management
consulting firm)
- -----------------------------------------------------------------------------------------------------------------------------
Claudio X. Gonzalez Laporte Director 2001 Chairman of the Board and CEO, 1
71 Kimberly-Clark de Mexico, S.A.
- -----------------------------------------------------------------------------------------------------------------------------
<Caption>
OTHER DIRECTORSHIPS(2)
NAME AND AGE HELD BY DIRECTOR
- ------------------------------------------------------------------
"NON-INTERESTED" DIRECTORS
Louise H. Bryson None
61
- ------------------------------------------------------------------
Mary Anne Dolan None
58
- ------------------------------------------------------------------
Martin Fenton None
70
- ------------------------------------------------------------------
Leonard R. Fuller None
58
- ------------------------------------------------------------------
Claudio X. Gonzalez Laporte America Movil, S.A. de C.V.;
71 General Electric Company; Grupo
Alfa, S.A. de C.V.; Grupo Carso,
S.A. de C.V.; Grupo Financiero
Inbursa; Grupo Industrial
Saltillo, S.A. de C.V.; Grupo
Mexico, S.A. de C.V.; The Home
Depot, Inc.; Kellogg Company;
Kimberly-Clark Corporation; The
Mexico Fund
- ------------------------------------------------------------------
</Table>
The Investment Company of America 3
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BOARD OF DIRECTORS
<Table>
<Caption>
NUMBER OF PORTFOLIOS
YEAR FIRST WITHIN THE FUND
POSITION ELECTED A COMPLEX(1)
WITH DIRECTOR OF PRINCIPAL OCCUPATION(S) OVERSEEN BY
NAME AND AGE THE FUND THE FUND DURING PAST FIVE YEARS DIRECTOR
- -----------------------------------------------------------------------------------------------------------------------------
John G. McDonald Director 1976 The Stanford Investors Professor, 8
68 Graduate School of Business,
Stanford University
- -----------------------------------------------------------------------------------------------------------------------------
Bailey Morris-Eck Director 1993 Director and Programming Chair, 3
60 WYPR Baltimore/Washington (public
radio station); Senior Adviser
(London), FINANCIAL NEWS; Senior
Fellow, Institute for
International Economics
- -----------------------------------------------------------------------------------------------------------------------------
Richard G. Newman Director 1996 Chairman of the Board and CEO, 13
70 AECOM Technology Corporation
(engineering, consulting and
professional technical services)
- -----------------------------------------------------------------------------------------------------------------------------
Olin C. Robison Director 1987 President of the Salzburg 3
69 Seminar; President Emeritus,
Middlebury College
- -----------------------------------------------------------------------------------------------------------------------------
William J. Spencer Director 1997 Chairman of the Board and CEO, 1
74 SEMATECH (research and
development consortium); Trustee,
William Jewell College; Trustee,
Associated Universities, Inc.
- -----------------------------------------------------------------------------------------------------------------------------
<Caption>
OTHER DIRECTORSHIPS(2)
NAME AND AGE HELD BY DIRECTOR
- -------------------------------------------------------------------
John G. McDonald iStar Financial, Inc.; Plum Creek
68 Timber Co.; Scholastic
Corporation; Varian, Inc.
- -------------------------------------------------------------------
Bailey Morris-Eck The Nevis Fund, Inc.
60
- -------------------------------------------------------------------
Richard G. Newman Sempra Energy; Southwest Water
70 Company
- -------------------------------------------------------------------
Olin C. Robison American Shared Hospital Services
69
- -------------------------------------------------------------------
William J. Spencer None
74
- -------------------------------------------------------------------
</Table>
4 The Investment Company of America
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BOARD OF DIRECTORS
<Table>
<Caption>
PRINCIPAL OCCUPATION(S)
DURING PAST FIVE YEARS NUMBER OF PORTFOLIOS
YEAR FIRST AND POSITIONS HELD WITH WITHIN THE FUND
POSITION ELECTED A AFFILIATED ENTITIES OR COMPLEX(1)
WITH DIRECTOR OF THE PRINCIPAL UNDERWRITER OVERSEEN BY
NAME AND AGE THE FUND THE FUND OF THE FUND DIRECTOR
- -----------------------------------------------------------------------------------------------------------------------------
"INTERESTED"
DIRECTORS(3)
James B. Lovelace Senior Vice 2000 Senior Vice President and 2
49 President and Director, Capital Research and
Director Management Company
- -----------------------------------------------------------------------------------------------------------------------------
Donald D. O'Neal Senior Vice 2001 Senior Vice President, Capital 2
44 President and Research and Management Company
Director
- -----------------------------------------------------------------------------------------------------------------------------
R. Michael Shanahan Vice Chairman 1998 Chairman of the Board, Capital 2
66 of the Board Research and Management Company;
Director, American Funds
Distributors, Inc.;(4) Chairman
of the Board, The Capital Group
Companies, Inc.;(4) Chairman of
the Board, Capital Management
Services, Inc.;(4) Director,
Capital Strategy
Research, Inc.(4)
- -----------------------------------------------------------------------------------------------------------------------------
<Caption>
OTHER DIRECTORSHIPS(2)
NAME AND AGE HELD BY DIRECTOR
- -------------------------------------------------------------------
"INTERESTED"
DIRECTORS(3)
James B. Lovelace None
49
- -------------------------------------------------------------------
Donald D. O'Neal None
44
- -------------------------------------------------------------------
R. Michael Shanahan None
66
- -------------------------------------------------------------------
</Table>
(1) Capital Research and Management Company manages the American Funds,
consisting of 29 funds. Capital Research and Management Company also
manages American Funds Insurance Series,-Registered Trademark- which serves
as the underlying investment vehicle for certain variable insurance
contracts; and Endowments, whose shareholders are limited to certain
nonprofit organizations.
(2) This includes all directorships (other than those of the American Funds)
that are held by each Director as a director of a public company or a
registered investment company.
(3) "Interested persons," within the meaning of the Investment Company Act of
1940, on the basis of their affiliation with the fund's investment adviser,
Capital Research and Management Company, or affiliated entities (including
the fund's principal underwriter).
(4) Company affiliated with Capital Research and Management Company.
The Investment Company of America 5
<Page>
DIRECTOR COMPENSATION
No compensation is paid by the fund to any officer or Director who is a
director, officer or employee of the investment adviser or its affiliates.
Effective July 1, 2004, the fund pays to Directors who are not affiliated with
the investment adviser: (a) fees of $2,000 for each Board of Directors meeting
attended, (b) $1,000 for each meeting attended as a member of a committee of the
Board of Directors and (c) annual fees of either $50,000 (if the Director also
receives compensation as a member of the Board of another fund advised by the
investment adviser and the other Board typically meets separately from the
fund's Board of Directors), or $60,000 (for all other unaffiliated Directors).
COMPENSATION AND FUND OWNERSHIP
<Table>
<Caption>
TOTAL COMPENSATION (INCLUDING
VOLUNTARILY DEFERRED
COMPENSATION(1) FROM ALL FUNDS
AGGREGATE COMPENSATION MANAGED BY CAPITAL
(INCLUDING VOLUNTARILY DEFERRED RESEARCH AND MANAGEMENT DOLLAR RANGE(3)
COMPENSATION(1)) FROM THE COMPANY OR ITS AFFILIATES(2) OF FUND SHARES
FUND DURING FISCAL YEAR ENDED DURING FISCAL YEAR ENDED OWNED AS OF
NAME DECEMBER 31, 2004 DECEMBER 31, 2004 DECEMBER 31, 2004
- -------------------------------------------------------------------------------------------------------------------------
"NON-INTERESTED" DIRECTORS
Louise H. Bryson $71,000(4) $71,000(4) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
Mary Anne Dolan 67,500 121,500 Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
Martin Fenton 64,375(4) 245,620(4) $50,001 - $100,000
- -------------------------------------------------------------------------------------------------------------------------
Leonard R. Fuller 64,356 183,115 $10,001 - $50,000
- -------------------------------------------------------------------------------------------------------------------------
Claudio X. Gonzalez Laporte 69,000(4) 69,000(4) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
John G. McDonald 80,625(4) 306,749(4) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
Bailey Morris-Eck 65,832 121,000 $50,001 - $100,000
- -------------------------------------------------------------------------------------------------------------------------
Richard G. Newman 79,382 151,620 Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
Olin C. Robison 68,832(4) 124,000(4) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
William J. Spencer 88,000(4) 88,000(4) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
<Caption>
AGGREGATE DOLLAR RANGE(3)
OF SHARES OWNED IN ALL
FUNDS IN THE AMERICAN
FUNDS FAMILY OVERSEEN BY DIRECTOR
NAME AS OF DECEMBER 31, 2004
- -------------------------------------------------------------------
"NON-INTERESTED" DIRECTORS
Louise H. Bryson Over $100,000
- -------------------------------------------------------------------
Mary Anne Dolan Over $100,000
- -------------------------------------------------------------------
Martin Fenton Over $100,000
- -------------------------------------------------------------------
Leonard R. Fuller $50,001 - $100,000
- -------------------------------------------------------------------
Claudio X. Gonzalez Laporte Over $100,000
- -------------------------------------------------------------------
John G. McDonald Over $100,000
- -------------------------------------------------------------------
Bailey Morris-Eck Over $100,000
- -------------------------------------------------------------------
Richard G. Newman Over $100,000
- -------------------------------------------------------------------
Olin C. Robison Over $100,000
- -------------------------------------------------------------------
William J. Spencer Over $100,000
- -------------------------------------------------------------------
</Table>
6 The Investment Company of America
<Page>
COMPENSATION AND FUND OWNERSHIP
<Table>
<Caption>
TOTAL COMPENSATION (INCLUDING
VOLUNTARILY DEFERRED
COMPENSATION(1) FROM ALL FUNDS
AGGREGATE COMPENSATION MANAGED BY CAPITAL
(INCLUDING VOLUNTARILY DEFERRED RESEARCH AND MANAGEMENT DOLLAR RANGE(3)
COMPENSATION(1)) FROM THE COMPANY OR ITS AFFILIATES(2) OF FUND SHARES
FUND DURING FISCAL YEAR ENDED DURING FISCAL YEAR ENDED OWNED AS OF
NAME DECEMBER 31, 2004 DECEMBER 31, 2004 DECEMBER 31, 2004
- -------------------------------------------------------------------------------------------------------------------------
"INTERESTED" DIRECTORS(5)
James B. Lovelace None(6) None(6) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
Donald D. O'Neal None(6) None(6) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
R. Michael Shanahan None(6) None(6) Over $100,000
- -------------------------------------------------------------------------------------------------------------------------
<Caption>
AGGREGATE DOLLAR RANGE(3)
OF SHARES OWNED IN ALL
FUNDS IN THE AMERICAN
FUNDS FAMILY OVERSEEN BY DIRECTOR
NAME AS OF DECEMBER 31, 2004
- -------------------------------------------------------------------
"INTERESTED" DIRECTORS(5)
James B. Lovelace Over $100,000
- -------------------------------------------------------------------
Donald D. O'Neal Over $100,000
- -------------------------------------------------------------------
R. Michael Shanahan Over $100,000
- -------------------------------------------------------------------
</Table>
(1) Amounts may be deferred by eligible Directors under a non-qualified
deferred compensation plan adopted by the fund in 1999. Deferred amounts
accumulate at an earnings rate determined by the total return of one or
more funds in the American Funds as designated by the Directors.
(2) Capital Research and Management Company manages the American Funds,
consisting of 29 funds. Capital Research and Management Company also
manages American Funds Insurance Series which serves as the underlying
investment vehicle for certain variable insurance contracts; and
Endowments, whose shareholders are limited to certain nonprofit
organizations.
(3) Ownership disclosure is made using the following ranges: None; $1 -
$10,000; $10,001 - $50,000; $50,001 - $100,000 and Over $100,000. The
amounts listed for "interested" directors include shares owned through The
Capital Group Companies, Inc. retirement plan and 401(k) plan.
(4) Since the deferred compensation plan's adoption, the total amount of
deferred compensation accrued by the fund (plus earnings thereon) through
the 2004 fiscal year for participating Directors is as follows: Louse H.
Bryson ($385,217), Martin Fenton ($42,341), Claudio X. Gonzalez Laporte
($253,071), John G. McDonald ($1,142,581), Olin C. Robison ($420,548) and
William J. Spencer ($739,301). Amounts deferred and accumulated earnings
thereon are not funded and are general unsecured liabilities of the fund
until paid to the Directors.
(5) "Interested persons" within the meaning of the Investment Company Act of
1940 on the basis of their affiliation with the fund's investment adviser,
Capital Research and Management Company, or affiliated entities (including
the fund's principal underwriter).
(6) No compensation is paid by the fund to any Director who is affiliated with
the investment adviser.
The Investment Company of America 7
<Page>
The fund has an Audit Committee comprised of Louise H. Bryson, Mary Anne Dolan,
Martin Fenton, Leonard R. Fuller, Claudio X. Gonzalez Laporte, John G. McDonald,
Bailey Morris-Eck, Richard G. Newman, Olin C. Robison and William J. Spencer,
none of whom is an "interested person" of the fund within the meaning of the
1940 Act. The function of the Audit Committee is oversight of the fund's
(1) accounting and financial reporting policies and practices, (2) internal
controls over financial reporting and (3) financial statements. The Audit
Committee acts as a liaison between the fund's independent registered public
accounting firm (who report directly to the Audit Committee) and the full Board
of Directors. Three Audit Committee meetings were held during the fiscal year
ended December 31, 2004.
The fund has a Nominating Committee comprised of Louise H. Bryson, John G.
McDonald and Olin C. Robison, none of whom is an "interested person" of the fund
within the meaning of the 1940 Act. The Nominating Committee has adopted a
charter setting forth its primary duties. Although the charter is not available
on the fund's website, it has been attached as Appendix B. The Nominating
Committee periodically reviews such issues as the Board's composition,
responsibilities, committees, compensation and other relevant issues, and
recommends any appropriate changes to the full Board of Directors. The
Nominating Committee also evaluates, selects and nominates independent director
candidates to the full Board of Directors. While the Nominating Committee
normally is able to identify from its own and other resources an ample number of
qualified candidates, it will consider shareholder suggestions of persons to be
considered as nominees to fill future vacancies on the Board. Such suggestions
must be sent in writing to the Nominating Committee of the fund, addressed to
the fund's Secretary, and must be accompanied by complete biographical and
occupational data on the prospective nominee, along with a written consent of
the prospective nominee for consideration of his or her name by the Nominating
Committee (see also "Shareholder Proposals"). Although there are no specific,
minimum qualifications that the Nominating Committee has established for
independent director candidates, in evaluating candidates the Nominating
Committee will take into account all factors it considers relevant, including
experience, demonstrated capabilities, independence, commitment, reputation,
background, understanding of the investment business and understanding of
business and financial matters generally. Where feasible and appropriate, the
Nominating Committee will seek to enhance the diversity of Board membership. The
Nominating Committee will also consider Board member succession issues. Two
Nominating Committee meetings were held during the fiscal year ended
December 31, 2004.
The fund has a Governance and Contracts Committee comprised of all directors who
are not considered to be "interested persons" of the fund within the meaning of
the 1940 Act. The Governance and Contracts Committee's function is to request,
review and consider the information deemed necessary to evaluate the terms of
certain agreements between the fund and its investment adviser or the investment
adviser's
8 The Investment Company of America
<Page>
affiliates, such as the Investment Advisory and Service Agreement, Principal
Underwriting Agreement, Administrative Services Agreement and Plans of
Distribution under rule 12b-1 adopted under the 1940 Act, that the fund may
enter into, renew or continue, and to make its recommendations to the full Board
of Directors on these matters. The Governance and Contracts Committee
periodically considers the responsibilities of Board committees, the continuing
need for each committee, the possible need for additional committees, and the
desirability of combining or reorganizing committees, and makes recommendations
to the full Board of Directors with respect to such matters. The Governance and
Contracts Committee may also consider the effectiveness of meetings, including
their frequency, scheduling and duration, adequacy and focus of agendas and
materials and presentations. One Governance and Contracts Committee meeting was
held during the fiscal year ended December 31, 2004.
During the 2004 fiscal year, the Board held a total of five meetings.
R. Michael Shanahan was unable to attend two of the five Board meetings due to a
temporary illness. All other incumbent directors attended at least 83% of the
meetings of the Board and of the Committees of the Board on which he/she served
during that time.
The Investment Company of America 9
<Page>
OTHER OFFICERS
<Table>
<Caption>
PRINCIPAL OCCUPATION(S) DURING YEAR FIRST
PAST FIVE YEARS AND POSITIONS ELECTED
NAME HELD WITH AFFILIATED ENTITIES AN OFFICER OF
(POSITION WITH FUND) OR THE PRINCIPAL UNDERWRITER OF THE FUND(1)
AND AGE THE FUND -------------
- ------------------------------------------------------------------------------
James F. Rothenberg President and Director, Capital 2000
(President) Research and Management
58 Company; Director, American
Funds Distributors, Inc.;(2)
Director, The Capital Group
Companies, Inc.;(2) Director,
Capital Group
Research, Inc.(2)
- ------------------------------------------------------------------------------
Gregg E. Ireland Senior Vice President, Capital 1994
(Senior Vice President) Research and Management Company
55
- ------------------------------------------------------------------------------
Joyce E. Gordon Vice President and Director, 1998
(Vice President) Capital Research and Management
48 Company; Senior Vice President,
Capital Research Company(2)
- ------------------------------------------------------------------------------
Anne M. Llewellyn Associate, Capital Research and 1984
(Vice President) Management Company
57
- ------------------------------------------------------------------------------
Vincent P. Corti Vice President -- Fund Business 1994
(Secretary) Management Group, Capital
49 Research and Management Company
- ------------------------------------------------------------------------------
Thomas M. Rowland Senior Vice President, Capital 1998
(Treasurer) Research and Management
63 Company; Senior Vice President,
The Capital Group
Companies, Inc.;(2) Director,
American Funds Service
Company(2)
- ------------------------------------------------------------------------------
R. Marcia Gould Vice President -- Fund Business 1993
(Assistant Treasurer) Management Group, Capital
50 Research and Management Company
- ------------------------------------------------------------------------------
</Table>
(1) Officers of the fund serve until their resignation, removal or retirement.
(2) Company affiliated with Capital Research and Management Company.
No officer, director or employee of the investment adviser receives any
remuneration from the fund. All of the officers listed, with the exception of
Anne M. Llewellyn and Thomas M. Rowland, are officers of one or more of the
other funds for which Capital Research and Management Company serves as
investment adviser. All directors and officers as a group owned beneficially
less than 1% of the fund's shares outstanding on June 13, 2005.
The address for all Directors and officers of the fund is 333 South Hope Street,
55th Floor, Los Angeles, California, 90071, Attention: Fund Secretary.
Correspondence intended for Directors should be sent to this address.
10 The Investment Company of America
<Page>
ADDITIONAL INFORMATION
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
The Board of Directors (including a majority of directors who are not
"interested persons" of the fund as that term is defined in the 1940 Act) has
selected PricewaterhouseCoopers LLP ("PwC") to act as the independent registered
public accounting firm for the fund for the fiscal year ending December 31,
2005. PwC has served as the fund's independent registered public accounting firm
since the fund's inception. No representative of PwC is expected to attend the
meeting of shareholders. In reliance on Rule 32a-4 under the 1940 Act, the Fund
is not seeking shareholder ratification of the selection of their independent
auditors.
The Audit Committee of the Board of Directors of the fund has discussed with PwC
representatives the independence of PwC from the fund and its management,
including the matters disclosed in the letter from PwC required by Independence
Standards Board Standard No. 1, and also considered whether the provision of
non-audit services described below is compatible with maintaining their
independence.
Securities and Exchange Commission rules require the disclosure of professional
fees billed to the fund, the investment adviser and affiliates of the investment
adviser providing services to the fund, during each of the fund's last two
fiscal years, as follows:
<Table>
<Caption>
BILLED TO THE FUND: 2003 2004
- -------------------------------------------------------------------------------------
Audit fees $96,000 $107,000
- -------------------------------------------------------------------------------------
Audit-related fees none none
- -------------------------------------------------------------------------------------
Tax fees 10,000 12,000
- -------------------------------------------------------------------------------------
(tax fees consist of professional services relating to the
preparation of the fund's tax returns)
- -------------------------------------------------------------------------------------
All other fees none none
- -------------------------------------------------------------------------------------
</Table>
<Table>
<Caption>
BILLED TO THE INVESTMENT ADVISER AND ITS AFFILIATES: 2003 2004
- ------------------------------------------------------------------------------------
(includes only fees for non-audit services billed to the
investment adviser and its affiliates that provide ongoing
services to the funds for engagements that relate directly
to the operations and financial reporting of the fund and
that were subject to the pre-approval policies described
below)
- ------------------------------------------------------------------------------------
Audit-related fees none none
- ------------------------------------------------------------------------------------
Tax fees none none
- ------------------------------------------------------------------------------------
All other fees none none
- ------------------------------------------------------------------------------------
</Table>
Pre-approval policies: The fund's Audit Committee will pre-approve all audit and
permissible non-audit services that the Audit Committee considers compatible
with maintaining the accountants' independence. The pre-approval requirement
will extend to all non-audit services provided to the fund, the investment
adviser, and any entity controlling, controlled by, or under common control with
the investment adviser that
The Investment Company of America 11
<Page>
provides ongoing services to the fund, if the engagement relates directly to the
operations and financial reporting of the fund. The Audit Committee will not
delegate its responsibility to pre-approve these services to the investment
adviser. The Audit Committee may delegate to one or more committee members the
authority to review and pre-approve audit and permissible non-audit services.
Actions taken under any such delegation will be reported to the full Audit
Committee at its next meeting. The pre-approval requirement is waived with
respect to non-audit services if certain conditions are met. The pre-approval
requirement was not waived for any of the services listed above.
Aggregate non-audit fees paid to the fund's accountants, including fees for all
services billed to the investment adviser and affiliates were $10,000 for fiscal
year 2003 and $12,000 for fiscal year 2004. The non-audit services represented
by these amounts were brought to the attention of the Audit Committee and
considered to be compatible with maintaining the accountants' independence.
The amounts shown above do not include amounts paid for audit, audit-related and
tax fees rendered to other mutual funds managed by the investment adviser that
PwC serves. Billings for these services during the fiscal year ended
December 31, 2004 totaled $1,117,000.
OTHER MATTERS
Neither the persons named in the enclosed proxy nor the Board of Directors are
aware of any matters that will be presented for action at the meeting other than
matters described above. If any other matters properly requiring a vote of
shareholders arise, the proxies will confer upon the person or persons entitled
to vote the shares in respect of any such matters in accordance with their best
judgment in the interests of the fund and its shareholders.
SHAREHOLDER PROPOSALS FOR 2006 ANNUAL MEETING
The fund expects to hold its next annual meeting of shareholders in August 2006.
Any shareholder proposal must be submitted in writing to the Secretary of the
fund, at the fund's principal executive offices, 333 South Hope Street, 55th
Floor, Los Angeles, CA 90071, and received by February 21, 2006 if it is to be
considered for inclusion in the fund's 2006 proxy materials. Any such proposals
must comply with all the requirements of rule 14a-8 under the Securities
Exchange Act of 1934, as amended. Shareholders wishing to suggest candidates to
the Nominating Committee for consideration as directors may do so by submitting
a written notice to the Secretary of the fund. The notice must be accompanied by
complete biographical and occupational data on the prospective nominee, along
with a written consent of the prospective nominee for consideration of his or
her name by the Nominating Committee. For a shareholder to nominate a director
candidate for the 2006 annual meeting, notice of the nomination must be received
by the fund by February 21, 2006.
12 The Investment Company of America
<Page>
If a shareholder submits a proposal at the annual meeting of shareholders to be
held in 2006 other than in accordance with rule 14a-8, and does not provide
notice of such proposal to the fund by May 5, 2006, the holders of any proxy
solicited by the fund's Board of Directors for use at such meeting will have
discretionary authority to vote with respect to any proposal as to which timely
notice is not given.
ANNUAL REPORT DELIVERY
The fund will furnish, without charge, a copy of its most recent annual report
and/or semi-annual report, to any shareholder upon request. Such requests should
be directed to the Secretary of the fund at 333 South Hope Street, 55th Floor,
Los Angeles, CA 90071, or by telephoning 800/421-0180.
GENERAL INFORMATION
Capital Research and Management Company is the investment adviser to the fund
and is located at 333 South Hope Street, Los Angeles, CA 90071 and 135 South
State College Boulevard, Brea, CA 92821. American Funds Distributors, Inc. is
the principal underwriter of the fund's shares and is located at the Los Angeles
and Brea addresses above and also at 3500 Wiseman Boulevard, San Antonio, TX
78251, 8332 Woodfield Crossing Boulevard, Indianapolis, IN 46240, and 5300 Robin
Hood Road, Norfolk, VA 23513.
The enclosed proxy is solicited by and on behalf of the Board of Directors of
the fund. The fund will pay the cost of soliciting proxies, consisting of
printing, handling and mailing of the proxies and related materials. In addition
to solicitation by mail, certain officers and directors of the fund, who will
receive no extra compensation for their services, may solicit by telephone,
telegram or personally. WE URGE ALL SHAREHOLDERS TO VOTE THEIR SHARES BY MAIL,
TELEPHONE OR THE INTERNET. IF VOTING BY MAIL, PLEASE MARK, SIGN, DATE, AND
RETURN THE PROXY CARD IN THE ENCLOSED ENVELOPE, WHICH REQUIRES NO POSTAGE IF
MAILED IN THE UNITED STATES. TO VOTE YOUR PROXY BY TELEPHONE OR THE INTERNET,
PLEASE FOLLOW THE INSTRUCTIONS THAT APPEAR ON THE ENCLOSED INSERT.
One copy of this proxy statement may be delivered to multiple shareholders who
share a single address. If you would like to obtain an additional copy of this
proxy statement, free of charge, write to the Secretary of the fund at 333 South
Hope Street, 55th Floor, Los Angeles, CA 90071, or by telephoning 800/421-0180.
These requests will be honored within three business days of receipt. If you
received a proxy statement for each shareholder who shares your address and
would like to receive a single copy of such material in the future, please write
to or call at the address and telephone number indicated above.
By order of the Board of Directors,
Vincent P. Corti
Secretary
June 23, 2005
The Investment Company of America 13
<Page>
<Page>
Appendix A
5% SHAREHOLDERS
(AS OF JUNE 1, 2005)
<Table>
<Caption>
AS %
OF SHARES
NAME AND ADDRESS CLASS SHARES HELD OUTSTANDING
- -----------------------------------------------------------------------------------------
Edward D. Jones & Co. A 367,545,143 17.50
201 Progress Parkway B 14,065,919 11.62
Maryland Heights, MO 63043-3009
- -----------------------------------------------------------------------------------------
Citigroup Global Markets, Inc. B 7,498,566 6.19
333 West 34th Street C 13,297,573 14.67
New York, NY 10001-2402
- -----------------------------------------------------------------------------------------
Merrill Lynch, Pierce, Fenner and Smith Inc. B 6,764,740 5.59
For the Sole Benefit of its Customers C 15,577,100 17.19
4800 Deer Lake Drive East
Jacksonville, FL 32246-6484
- -----------------------------------------------------------------------------------------
Charles Schwab & Co. Inc. F 3,699,628 9.20
101 Montgomery Street
San Francisco, CA 94104-4122
- -----------------------------------------------------------------------------------------
Hartford Life Insurance Company R-1 131,471 14.43
P.O. Box 2999 R-3 2,694,448 14.37
Hartford, CT 06104-2999
- -----------------------------------------------------------------------------------------
Union Bank of California Trust R-1 79,052 8.67
P.O. Box 5024
Costa Mesa, CA 92628-5024
- -----------------------------------------------------------------------------------------
John Hancock Life Insurance Company USA R-3 2,391,824 12.76
250 Bloor Street East, 7th Floor
Canada, M4W 1E5
- -----------------------------------------------------------------------------------------
Saxon & Co. R-4 685,498 11.32
P.O. Box 7780-1888
Philadelphia, PA 19182-0001
- -----------------------------------------------------------------------------------------
Marshall & Ilsley Trust Co. R-4 385,064 6.36
1000 N. Water Street
Milwaukee, WI 53202-6648
- -----------------------------------------------------------------------------------------
State Street Bank & Trust Co. TTEE R-5 34,679,688 74.63
105 Rosemont Boulevard
Westwood MA 02090-2318
- -----------------------------------------------------------------------------------------
Vanguard Fiduciary Trust R-5 2,437,574 5.25
P.O. Box 2600
Valley Forge, PA 19482-2600
</Table>
A-1
<Page>
<Page>
Appendix B
THE INVESTMENT COMPANY OF AMERICA
(THE "FUND")
NOMINATING COMMITTEE CHARTER
I. COMMITTEE ORGANIZATION
The Nominating Committee ("the COMMITTEE"), a committee established by the Board
of Directors (the "BOARD"), will be comprised solely of members of the Board who
are not considered "interested persons" of the fund under the Investment Company
Act of 1940 (the "ACT"), and who are otherwise independent. To be considered
independent a member may not, other than in his or her capacity as a member of
the Board, the Committee or any other committee of the Board, accept any
consulting, advisory or other compensatory fee from the fund, or be a former
officer or director of Capital Research and Management Company ("CRMC") or any
of its affiliates.
The Board will appoint the members of the Committee. If the Board has not
designated a Chair of the Committee, the Committee members may designate a Chair
by majority vote of all members. The Committee will be composed of at least
three independent directors. The fund's Secretary will serve as Secretary of the
Committee.
The Committee will meet with the frequency, and at the times, determined by the
Committee Chair or a majority of Committee members. Under normal circumstances,
the Committee is expected to meet at least annually. The Chair will cause notice
of each meeting, together with the agenda and any related materials, to be sent
to each member, normally at least one week before the meeting. The Chair will
cause minutes of each Committee meeting to be prepared and distributed to
Committee members promptly. The Committee may ask independent legal counsel,
representatives of CRMC or others to attend Committee meetings and provide
pertinent information as necessary or desirable. The Committee may also meet in
executive session.
II. DUTIES AND RESPONSIBILITIES
The Committee will:
(a) Evaluate the size and composition of the Board, and formulate policies and
objectives concerning the desired mix of independent director skills and
characteristics. In doing so, the Committee will take into account all
factors it considers relevant, including experience, demonstrated
capabilities, independence, commitment, reputation, background,
understanding of the investment business and understanding of business and
financial matters generally. Where feasible and appropriate, the Committee
will seek to enhance the diversity of Board membership. The Committee will
also consider Board member succession issues.
B-1
<Page>
(b) Identify and screen independent director candidates for appointment to the
Board, and submit final recommendations to the full Board for approval. If
the fund has an Advisory Board, the Committee will perform a similar
function in relation to the Advisory Board.(1) The Committee will, in
identifying and screening candidates, adhere to the policies and objectives
it has previously formulated concerning independent director skills and
characteristics.
(c) Review independent director (and, if applicable, Advisory Board member)
compensation at least every two years, and expense-reimbursement policies
as appropriate. The Committee will make recommendations on these matters to
the full Board.(2)
(d) Review materials, including information drawn from independent director
questionnaires, relating to positions, transactions and relationships that
could reasonably bear on the independence of directors or raise concerns
regarding potential conflicts of interest.
(e) Make recommendations to the full Board concerning the appointment of
independent directors to the Board's committees. The Committee may make
recommendations to the full Board concerning the appointment of the Chair
of each Board committee and periodic changes in those appointments and
designations.(3)
III. AUTHORITY AND RESOURCES
The Committee will have the resources and authority appropriate to discharge its
responsibilities, including, among other things, the authority to retain a
search firm to assist the Committee in identifying, screening and attracting
independent directors.
Independent legal counsel to the independent directors will serve as independent
legal counsel to the Committee.
- ---------------------
(1) Committee members are encouraged to be alert to potential candidates on an
ongoing basis, so that a pool of prospects is available for consideration
when needs arise. As part of the identification and screening process, the
Committee may consider candidates CRMC suggests, and may involve CRMC
representatives in screening candidates. However, the decision to approve
candidates for submission to the Board (or Advisory Board, if applicable)
will be made exclusively by the Committee.
(2) Director compensation recommendations may take into account the size of the
Fund, the demands placed on the independent directors, the practices of
other mutual fund groups, the need to attract and retain qualified
independent directors, any relevant regulatory or judicial developments,
and other considerations deemed appropriate by the Committee.
(3) Recommendations in this area will be made after consideration of all
relevant factors, including the desires and capacities of individual
directors, and their roles on the boards and board committees of other
funds managed by CRMC. Formal term limits for committee members or Chairs
are not necessary, but the Committee will periodically consider their terms
of service and the possible desirability of changes.
B-2
<Page>
IV. POLICIES AND PROCEDURES
The Committee's policies and procedures may change from time to time to reflect
new or evolving business conditions or nominating committee practices. In
meeting its responsibilities, the Committee is expected to:
(a) Provide oversight regarding the orientation of new independent
directors.(4) The Committee Chair will designate an experienced independent
director to assist, and be available to, each new independent director
during his or her first year of service on the Board.
(b) Consider, at such times as the Committee may deem appropriate, whether the
composition of the Board, its committees (and, if applicable, the fund's
Advisory Board) reflect an appropriate blend of skills, backgrounds and
experience, in relation to the goal of maximizing their effectiveness. The
Committee may also consider, as appropriate, Board member attendance.
(c) Periodically review and reassess the adequacy of this Charter, and
recommend to the full Board any changes deemed advisable.
- ---------------------
(4) It is expected that orientation materials will be provided to each new
director and one or more orientation sessions arranged. These sessions
should be geared towards providing a working knowledge of the duties and
obligations of mutual fund directors and their role in overseeing mutual
fund investments and operations. Orientation sessions may be facilitated by
or include members of the Committee, representatives of CRMC and/or
independent legal counsel, as appropriate. New independent directors are
encouraged to participate in other educational opportunities, including
those provided by the Investment Company Institute.
B-3
<Page>
<Page>
[logo - American Funds (r)]
The right choice for the long term (SM)
[RECYCLE LOGO]
Printed on recycled paper.
- --------------------------------------------------------------------------------
THE CAPITAL GROUP COMPANIES
American Funds Capital Research and Management Capital International Capital Guardian Capital Bank and Trust
<page>
[logo - American Funds (r)]
PROXY CARD
THE INVESTMENT COMPANY OF AMERICA
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD AUGUST 11, 2005
The undersigned hereby appoints Vincent P. Corti, Paul G. Haaga, Jr. and Gregg
E. Ireland, and each of them, his/her true and lawful agents and proxies with
full power of substitution to represent the undersigned at the Annual Meeting of
Shareholders to be held at the Hotel du Pont, 11th and Market Streets,
Wilmington, Delaware, on Thursday August 11, 2005 at 9:00 a.m., on all matters
coming before the meeting.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY. WHEN PROPERLY COMPLETED, IT WILL
BE VOTED EXACTLY AS YOU INSTRUCT. IF YOU SIGN AND RETURN THIS PROXY, WITHOUT
OTHERWISE COMPLETING IT, YOUR SHARES WILL BE VOTED FOR THE PROPOSALS.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-241-6192
CAPITAL BANK AND TRUST
COMPANY AS TRUSTEE
/s/ Thomas J. Hamblin
AUTHORIZED OFFICER
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR ON THIS CARD. JOINT OWNERS
SHOULD EACH SIGN INDIVIDUALLY. CORPORATE PROXIES SHOULD BE SIGNED IN FULL
CORPORATE NAME BY AN AUTHORIZED OFFICER. FIDUCIARIES SHOULD GIVE FULL TITLES.
Signature
Signature of joint owner, if any
Date
ICA_15329
<page>
[logo - American Funds (r)]
PROXY CARD
THE INVESTMENT COMPANY OF AMERICA
PROXY SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF SHAREHOLDERS TO BE HELD AUGUST 11, 2005
The undersigned hereby appoints Vincent P. Corti, Paul G. Haaga, Jr. and Gregg
E. Ireland, and each of them, his/her true and lawful agents and proxies with
full power of substitution to represent the undersigned at the Annual Meeting of
Shareholders to be held at the Hotel du Pont, 11th and Market Streets,
Wilmington, Delaware, on Thursday August 11, 2005 at 9:00 a.m., on all matters
coming before the meeting.
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY. WHEN PROPERLY COMPLETED, IT WILL
BE VOTED EXACTLY AS YOU INSTRUCT. IF YOU SIGN AND RETURN THIS PROXY, WITHOUT
OTHERWISE COMPLETING IT, YOUR SHARES WILL BE VOTED FOR THE PROPOSALS.
VOTE VIA THE INTERNET: https://vote.proxy-direct.com
VOTE VIA THE TELEPHONE: 1-866-241-6192
NOTE: PLEASE SIGN EXACTLY AS YOUR NAME(S) APPEAR ON THIS CARD. JOINT OWNERS
SHOULD EACH SIGN INDIVIDUALLY. CORPORATE PROXIES SHOULD BE SIGNED IN FULL
CORPORATE NAME BY AN AUTHORIZED OFFICER. FIDUCIARIES SHOULD GIVE FULL TITLES.
Signature
Signature of joint owner, if any
Date
ICA_15329
<page>
THE INVESTMENT COMPANY OF AMERICA
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS. Example: X
1. Election of Directors:
FOR WITHHOLD FOR ALL
ALL ALL EXCEPT
01 Louise H. Bryson 08 Bailey Morris-Eck
02 Mary Anne Dolan 09 Richard G. Newman ___ ___ ___
03 Martin Fenton 10 Donald D. O'Neal
04 Leonard R. Fuller 11 Olin C. Robison
05 Claudio X. Gonzalez Laporte 12 R. Michael Shanahan
06 James B. Lovelace 13 William J. Spencer
07 John G. McDonald
To withhold your vote for any individual nominee, mark the "For All Except"
box and write the nominee's number on the line provided below.
IMPORTANT
SHAREHOLDERS CAN HELP THE FUND AVOID THE NECESSITY AND EXPENSE OF SENDING
FOLLOW-UP LETTERS BY PROMPTLY SIGNING AND RETURNING THIS PROXY.
PLEASE SIGN AND DATE ON THE REVERSE SIDE BEFORE MAILING