On the go:Two-thirds of FTSE 100 companies that have announced annual meetings plan to conduct them behind closed doors under the Covid-19 lockdown, sparking concerns over shareholder rights.
Campaign group ShareAction has written to chairs of the UK’s blue-chip companies in response, urging them to hold meetings virtually to facilitate shareholder engagement and voting on key issues.
Facilitating access for all types of shareholders would allow questioning in real time in advance of any votes, ShareAction continued. It also demanded that as physical meetings return whenever it is safe to do so, they preserve a virtual element for those unable to attend.
Companies that have denied shareholders the ability to participate virtually and are holding meetings with just two board members present include BAE Systems, HSBC and Next, according to the group.
ShareAction praised the efforts of Taylor Wimpey, RBS and other companies that have taken steps to replicate the accountability of physical AGMs.
In the letter, Simon Rawson, director of corporate engagement at ShareAction, said: “This is not a moment to hide away. The Covid-19 crisis has seen the value of pension assets and shareholdings fall sharply. Management teams are making vitally important decisions that will affect the long-term success of companies, as well as the lives of their workers and customers.”
He added that restricting participation to a quorum of board members typically means that women are excluded from the process, since female board members are usually under-represented.
Peter Parry, policy director at the UK Shareholders’ Association, added:“Companies that have failed to establish trust and give the impression of being evasive with their shareholders will struggle. Closed AGM meetings and other actions that limit the flow of information to investors will be viewed with great suspicion.
“Shareholder support is likely to be forfeited when it is most needed, while the ensuing information-vacuum is liable to provoke big share price swings.”
