The Australian Council of Superannuation Investors (ACSI) welcomes moves to protect shareholder rights at company AGMs and warns of the challenges of virtual-only meeting beyond the pandemic.
Legislation introduced by the Federal Government’s today 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.
However, recent proposals from some ASX300 companies to enshrine virtual-only annual general meetings in their constitutions have been met with concern from investors.
“We recognise that virtual meetings remain a necessity given the limitations on gatherings still in place in many Australian states,” ACSI CEO Louise Davidson said. “Beyond the pandemic, there is an emerging preference from investors for hybrid meetings that allow in person and virtual attendance.”
“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.”
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. These included filtering or censoring questions provided in writing and preventing shareholders from speaking in real time.
ACSI has contacted each ASX300 company to make sure concerns have been adequately considered by those advising companies on draft constitutional amendments.
“We encourage companies to consider these matters, especially if they plan to propose to constitutional amendments to allow virtual only meetings,” Ms Davidson said.
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