Activity at 2017 and 2018 AGMs has been one of continuing concern over executive pay, an increase in votes against individual directors and an increase in questions raised around environmental and social issues. It is likely that these trends will continue. Boards will need to demonstrate that they are implementing the new governance requirements including greater engagement with their employees and other stakeholders in a proactive way if they are to address shareholder concerns.
AGM logistics are key to begin planning the AGM in the corporate calendar. An enormous effort is made by companies to ensure that their AGM is held at the right location, at the right time, for the right cost. This year there has been little change to the locations used by companies for AGMs with the large majority of companies continuing to hold their AGM in London.
A review of the types of questions asked at FTSE 350 AGMs reveals some interesting trends with a noticeable increase in questions about environmental concerns and climate change.
Key issues to be aware of for AGM planning 2019:
- Continuing concern over executive remuneration
- Possible increased voting against auditor appointments/re-appointments or auditor fee resolutions
- Use of votes against the company Chair and/or audit, nomination and remuneration committee Chairs where there are concerns over governance issues
- Voting against individual directors for perceived over-boarding or concerns over independence
- Dissent against the pre-emption resolution if this does not comply with the Pre-emption Group Guidelines
- Pressure on companies to explain and show how they are planning for Brexit
Lisa Graham, Registrar, Equiniti commented ‘’It’s been another interesting AGM season particularly regarding concerns over executive pay and an increase in questions around environmental and social issues. I am proud that our Meeting Management Team have been on hand to support clients and look forward to what additional challenges the 2019 season may bring”.