The Cairns Post
Virtual AGMs dumped
AUSTRALIA’S biggest companies are abandoning virtual annual meetings beyond the Covid-19 pandemic after facing a backlash from shareholders.
Treasurer Josh Frydenberg granted companies relief from the Corporations Act, allowing them to hold virtual annual meetings until March.
But investors have rejected attempts to make virtual AGMs a permanent fixture, fearing they will lose the rights to eyeball and scrutinise company directors.
Companies including Qantas, Brambles, and Bendigo and Adelaide Bank have torn up proposed amendments to their constitutions to allow virtual AGMs.
Vitamins maker Blackmores has updated its guide for shareholders before its AGM to make it clear it supports verbal questions, following an escalating feud between chairwoman Anne TemplemanJones and biggest shareholder Marcus Blackmore.
“Recent proposals from some ASX300 companies to enshrine virtual-only annual general meetings in their constitutions have been met with concern from investors,” the Australian Council of Superannuation Investors chief executive Louise Davidson said.
“We recognise that virtual meetings remain a necessity given the limitations on gatherings still in place in many Australian states. (But) there is a real concern from investors large and small that a move to virtual-only meetings in perpetuity could reduce the transparency and engagement of company meetings.”
To strike a compromise, federal parliament introduced new laws giving companies permission to hold a blend of in-person and virtual meetings on an ongoing basis.
The legislation also makes it clear shareholders should be given a reasonable opportunity to take part in an AGM, even if they cannot attend in person.
“Legislation introduced by thefederalgovernment...provides protections for shareholder participation in AGMs. As limitations imposed by the pandemic recede, hybrid models that encapsulate both virtual and in-person AGMs would provide better balance than virtual-only meetings,” Ms Davidson said.
“Improvements to virtual meetings to give shareholders a reasonable opportunity to participate and speak verbally or in writing during meetings are expected to curb some poorer practices that developed in the 2020 AGM season.”
Qantas said although the use of “virtual meeting technology” was only proposed to be used in “exceptional circumstances” it abandoned the change before its AGM on
November 5 after listening to its shareholders.
Similarly, Bendigo and Adelaide Bank backflipped after opposition from investors.
The Australian Securities and Investments Commission has warned investors it will be looking to ensure shareholder rights are upheld.
Blackmores updated its shareholder guidance before its annual meeting on October 27 to make it clear it supported verbal questions, after concerns from some shareholders that their questions would only be accepted in writing.