Does this sound like a warm and welcoming invitation to an annual general meeting of shareholders?
“Board members will not be available for interaction with shareholders in person.” Followed by: “Any shareholders travelling to the venue against the board’s recommendation will be advised to join the meeting electronically.” And finally: “Refreshments will not be provided.”
Those snippets are from Marks & Spencer’s notice of meeting for its AGM earlier this week – a “fully digitally enabled” meeting, by which the company meant digital-only. In other words, do not attend in person and, if you try to, you won’t get a cup of tea, let alone a sandwich. As a way to revive interest in company annual meetings and “stand up for the small shareholder”, which is a pet project of M&S chairman Archie Norman, it was an odd tactic.
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Thankfully – after strong pushback from shareholders who wanted to be there (plus a few who ignored instructions and turned up anyway) – it won’t be repeated. Indeed, Norman nows says the wording in the notice of AGM “was never our intent, it was a mistake” and had been carelessly copied from phrasing used during Covid lockdown when online-only AGMs were the only ones permitted. Norman is still pushing the digital agenda strongly but next year’s meeting – rightly – will be a hybrid affair.
Where Norman is clearly correct in his effort to enliven AGMs is in diagnosing that access is a big issue. Too many physical events are sparsely attended and dull; even some FTSE 100 companies struggle to attract a couple of dozen shareholders.
A digital component broadens the base of possible participants; not everybody has the time or inclination to travel to, in M&S’s case, its headquarters in London. Last year, the retailer found it had three times as many attenders watching online as it had had in-person pre-pandemic. It would be foolish not to recognise that digital has a role to play when video conferencing has become part of everyday life.
In the same spirit, Norman should be commended for badgering investment platforms, such as Interactive Investor, to allow companies to communicate directly with private shareholders. “Nominee accounts” ease the administration burden for platforms but should not be allowed to become a blockage on dialogue.
But there will be a problem if digital is overly emphasised and in-person is discouraged by stealth. The basic shareholder right to turn up and question directors face-to-face ought to be sacrosanct. Not everybody wants her or his question filtered through a “shareholder advocate”, which is how M&S arranged things at Tuesday’s AGM. Boos and applause in the room also matter.
These occasions don’t have to be uncomfortable for the directors – but they ought to have the potential to be so. That includes the odd run-in with lobby or protest groups that have bought a share specifically to ask a question at an AGM. Sniffy directors may regard such groups as not being “real” shareholders but tough: that’s life as a quoted company. If boards give the impression they would prefer not to meet all flavours of shareholder in person, they just look slippery.
M&S, to be clear, is not in that camp. It has held separate “shareholder panel” events for years aimed specifically at private investors. Norman should also be applauded for wanting to create “the best attended AGM in Britain”. But he should measure success not only by the number of online viewers he can attract but also by the number of people wanting to show up physically. Let the punters decide how they wish to participate. Yes to hybrid meetings; not to online-only.
