The season for annual general meetings of shareholders (‘GM’) is closer – many of companies already announced the dates for the annual meetings.
Date of the GM
One of the most important aspects when planning an GM is the date: we can see for instance that many of the Romanian or Polish companies are planning the GMs without considering the fact that in the same day there are several GMs, in same time, maybe in different cities. An example is for 2023 annual GMs: three annual GM already announced for 26 April and 4 are announced for 27 April 2023. What is the interest of the listed company in engaging with shareholders if they plan the annual GMs in same time with other companies?
Dissemination of information
The second aspect that needs to be considered is that information disseminated prior to the general meeting must offer clear instructions on how to attend the meeting and participate, in order to enable effective shareholder engagement. There are many retail investors that are not following the announcements lists on stock exchange website, so the information needs to be disseminated in different other ways, depending by their type.
There are several ways to achieved this:
• In addition to the notice of meeting, appropriate means of communication should be used to update all shareholders.
• Clear and timely instructions for the process for attending and participating in the meeting (depending on the format of the meeting), including access to the meeting, should be provided to shareholders in advance of the meeting. Participating remotely to GM is a new trend, very useful for busy shareholders.
• Details on how to appoint and instruct a proxy should be provided to shareholders well in advance of the proxy deadline.
• Shareholders who are yet to opt-in to receive electronic communications should be encouraged and informed of the process for doing so. Use of social media for announcing a GM is also a good use of technology in engaging with shareholders.
• Information made available to shareholders should provide clarity on what form(s) ‘electronic facilities’ will take and what it may cover. For example, there should be clarity on whether the facility will enable shareholders to ask questions or only view/hear the proceedings at the GM.
• The notice of GM should make it clear that unacceptable behavior will not be tolerated at the GM and that it will be dealt with appropriately by the chair of the GM.
Language
The last, but an important aspect is language. There are companies that are publishing GM’s documentation only in a local language (Romanian, Polish, German), even they have foreign investors as shareholders.
This represents a discrimination between investors represents a violation of Directive (EU) 2017/828 of the European Parliament and of the Council of 17 May 2017 amending Directive 2007/36/EC as regards the encouragement of long-term shareholder engagement as the shareholders are not treated equally and foreign investors needs to engage more costs for exercising their voting rights.
‘There are 3 types of investors:
1. Those who don’t know anything
2. Those who know a little
3. And those who don’t realize they don’t know anything!” - greekshares.com/more-investing-and-investments-fun-and-jokes/