Lucy Newcombe, Corporate Communications Director at Computershare, takes us through the 2014 AGM season around the globe.

It has been another packed AGM season around the world in 2014, with remuneration remaining the prime focus of attention in many countries; attendance and voting generally continuing to slide in the West; and some changes in legislation meaning altered operating procedures for AGMs in various countries.

Hong Kong and Mainland China

Ahead of this year’s AGM season, there was an increase in corporate actions being undertaken in Hong Kong and Mainland China, meaning companies were particularly stretched for resources. Consequently, some large company meetings were held a month later than in previous years.

This didn’t affect attendance however, with the number of shareholders pitching up in person at AGMs continuing to rise steadily.

The best attended AGM was once again that of a Chinese bank, with 4,601 people arriving at the meeting venue.

Overall, the average number of attendees at meetings over 100 people in size increased dramatically, with a leap from 456 per meeting in 2013 to 558 in 2014.

As highlighted in previous years, an increase in attendance does not necessarily correlate with voting statistics – and indeed, in 2014, for the fourth year in a row, voting figures in Hong Kong and Mainland China dropped significantly – with an almost 20% decrease in the voting in just the past four years.

This increased attendance without a corresponding increase in voting is naturally continuing to cause concern for companies, both relative to venue size and also cost. Companies in Hong Kong which give souvenirs to shareholders face the biggest issue as, traditionally, one souvenir is handed out for each shareholder represented, rather than each shareholder who physically attends. This means that there is a trend for shareholders to appoint each other as proxies – so they can then collect one gift themselves, and one for each of the people they are representing as proxy. If Mr A and Mr B appoint each other as proxies and both turn up to the meeting, they walk away with four gifts rather than two. The gift culture also continues to encourage the practice of splitting shareholdings into small chunks amongst family members – again to maximise the freebies obtained. Companies end up handing out multiple gifts to one person – who then often exits, laden down, without voting or participating in any other governance aspect of the AGM. This has led to some companies changing their policy and they are now stating that they will give only one souvenir to each attendee who turns up, no matter how many other shareholders that person may be representing. Other companies may also wish to consider this policy as a way of cutting down on cost.

Unlike last year, undesirable shareholder behaviour was not a particular issue at this year’s Hong Kong-based AGMs.

hk14chIn the Mainland, the China Securities Regulatory Commission (CSRC) revised the ‘Rules for the General Meetings of Shareholders of Listed Companies’ in June. Protecting the rights of the small and individual investors saw increased focus, with companies required to separately tabulate, disclose and report to the regulatory body the outcome of resolutions which will impact small investors. Also in line with the new rules, and again designed to recognise the rights of the small investor, all listed companies with A-shares must now provide both an online voting and physical meeting at the same time and make the two voting channels very clear in their AGM notification. This past season saw companies implement this requirement.

hk14ch2Overall, the outcome of voting is obviously of vital importance to listed companies – and this year we again saw a number of resolutions being rejected and others only narrowly scraping through. This is still a relatively new phenomenon for Hong Kong and Mainland China and highlights a continuing need for companies to focus more attention on likely vote outcomes – as we’ve seen listed entities in the US, UK, Australia and across Europe have had to do in recent years. Being sufficiently clear on who your shareholders are, what their current opinions are and consequently how they are likely to vote, is of increasing importance if you want your resolutions to pass the shareholder vote. Your registrar should be able to recommend a proxy solicitor and provider of underlying shareholder ID reports to assist with this.

Lastly, journalists have started to wake up to the fact that if they own shares or get themselves appointed proxy, they can obtain entrance to a particular meeting they’re interested in writing about, rather than waiting outside to ask shareholders who have been through the doors what went on. With this in mind, having your PR person present at the meeting is a good idea – as is reaching out to journalists who regularly write about your company in advance, and just as with your other shareholders, ascertaining whether they are likely to attend and if so, what their topics of interest will be.


2013 was a significant year for India with its new Companies Act coming into force – replacing the Act of 1956. The new Act is being notified in phases and most were announced in April of this year, meaning they were in force in time for the AGM season. The biggest change from an AGM perspective is the introduction of compulsory e-voting (via tablet at the event) for companies with more than 1,000 shareholders. Though actually not compulsory until 31 December, Reliance Industries shareholders got a taste of the future when the company took the opportunity to introduce tablets to register shareholder votes with everything going very smoothly and one attendee commenting: ‘Earlier when I used to vote through show of hands it felt like just a formality. But now I actually felt I voted for the first time.’

While its population is significantly smaller than that of China, India experiences a much larger shareholder turnout at AGMs – the largest in the past season was for the government-owned National Hydroelectric Corporation Ltd with over 37,000 attendees. People attending for gifts is also a significant problem – with over 90% of the attendees not making it past the free snacks and gifts and into the meeting itself. Shareholder activism continues to rise across the subcontinent, with Tata Motors – the largest domestic automobile company – seeing minority shareholders advised by shareholder advisory firm Stakeholders Empowerment Services (SES) successfully fighting a management proposal to let three directors keep excess payments made to them. Two thirds of institutional and retail shareholders voted against the management proposal as a result.


Across the Indian Ocean, AGM attendance is not in nearly such good shape – with Australia’s largest meeting comprising just 580 shareholders and the number of investors voting continuing to decrease – only 5.3% of all shareholders voted in 2013 compared with 5.9% in 2012. In the last five years there has been a 29% drop in the number of shareholders voting at company meetings. Attendance numbers also continued to decline, with less than a quarter of one percent of shareholders turning up on the day. However, the total amount of issued capital voted increased from 42.9% in 2012 to 45.3% for Computershare clients.

Although the traditional proxy form continued to be the primary voting method, voting via the web was at its highest ever level, with almost 30% of investors who voted doing so online. Ten percent of these used a mobile device to cast their vote. It’s probable that the increasing pressure from the Financial Services Council (FSC) and the Australian Council of Superannuation Investors (ACSI) on institutional investors to vote on all meetings will continue to drive higher levels of issued capital voting in the future.

The 2013 meeting season was the third season that the Australian two strikes egislation was in operation, and the second year of companies facing their second strike (the data for 2014 is not yet available). Requiring the board to stand for re-election if 25% or more of votes are cast against remuneration two years in a row, the rule is designed to give investors more power. In 2013, fewer companies received a first strike (80 in 2013 compared with 99 in 2012) while in a similar result to 2012, almost a quarter of all ASX listed issuers facing a second strike in 2013 actually received a second strike (22 in 2013 compared with 25 in 2012).

North America

Heading to North America, Canada’s largest meeting attendance was just 212 shareholders in spite of a large number of meetings taking place. Voting is also on the decline and recent Canadian proxy battles have all been relatively small with the majority being settled behind the scenes. This highlights the fact that proactive management teams and even boards of directors across Canada are actively courting their shareholders to understand their views and opinions on an ongoing basis – rather than waiting to find out at their meeting that several resolutions aren’t going to make it through the vote.

After a significant blip in 2012, voting at US AGMs is back at historical levels and indeed climbing slightly. In 2013, 2.7 million shareholders registered a vote, compared to just 1.8 million in 2012. With the 2014 season still underway, figures are already on a par with 2013. However, just 20 meetings saw attendance figures climb over 100.

As of 1 January 2009, the SEC’s ‘Shareholder Choice Regarding Proxy Materials’ rule made internet posting of proxy materials and notification of availability – ‘notice and access’ or ‘e-proxy’ – mandatory for all issuers and registered investment companies soliciting proxies.

Issuers may include the notification of internet availability of materials as part of their traditional proxy materials mailing, or may elect to send a one-page notice document to holders – the ‘notice-only option’ – informing them of the online location of the materials. This type of mailing continues to increase in the US, with nearly 350 recorded so far in 2014 versus 50 in 2008 and 320 last year.



uk14hThings have once again been busy in the UK. For the first time, shareholders have had a binding vote on company pay policy, meaning more work for companies in implementing the new rules and engaging with investors to understand which way the vote would go. Dissent across the board has fallen slightly, however the remuneration policy is a new entry in the top five contentious resolutions for UK companies (see graphic above).

Across the UK’s top 350 listed companies, 3.96% more shareholders participated at AGMs compared to 2010, indicating a more active approach to investing. Sainsbury’s had the largest attendance, with 535 shareholders turning up in total.

Continental Europe

Italy continues to buck the attendance trend seen in Northern Europe, with its largest AGM seeing 6,543 attendees – otherwise, the season was generally unremarkable. Russia’s AGM season peaked on 30 June, with 36 AGMs taking place that day. Forty-six percent of companies in Russia saw between 90 and 100% of their issued share capital voted at the AGM. In Denmark, the season was notable for the same shareholder asking the same eight questions at 22 AGMs!

South Africa

2014 heralded the requirement for South African companies to publish detailed voting results, rather than to merely indicate if a resolution passed or failed; and also saw an increase in shareholder activism – including the use of online tools to motivate shareholders to vote against resolutions.

The country’s largest AGM was that of Sasol Inzalo Ltd, where 359 members and 175 visitors attended the meeting and 1,273 members voted via proxy. This meeting was advertised on the radio and in newspapers, as well as SMS notifications being sent to shareholders, which resulted in the relatively large attendance size. The company has announced that next year it will be hiring a bigger venue as it plans to continue its promotional campaign to ensure maximum shareholder attendance.


Lucy Newcombe Corporate Communications Director at Computershare