e-Meetings - Not Just
For Governance Nerds Anymore
Tuesday, September 28, 2010
I have followed
the debate on electronic annual meetings (or e-meetings) with some care,
but hey, it's my job. Apologies if I offend any fellow activist
investors (or sticklers for formal English) with "nerd", but I truly
thought only aficionados cared for the nature and conduct of e-meetings.
But, when Gretchen Morgenson
features the subject in her column on the front page of the Sunday
New York Times Business Section this past weekend, then maybe other
smart investors might find this interesting, or even important.
Here I'll merely reference her meaty tale of how
Symantec Corporation sidestepped nosy shareholder questions by
conducting their annual meeting like the worst perfunctory quarterly
conference call. At the meeting last week, listeners (audio only, no
video feed) didn't even know which directors, the ones on whom
shareholders had just voted, even attended the meeting. All-in-all, a
very unsatisfactory application of a cutting-edge idea.
I thought this subject interests only the hard-core among us activist
investors. We follow the subject through a
useful resource at The Shareholder Forum. The site moderates a
discussion about how companies should conduct e-meetings, proposes and
debates guidelines and standards for e-meetings, and cites good and bad
examples of recent e-meetings.
What does this mean for smart investors?
But something larger is going on. Let's set aside, for the moment, how
well or poorly one or another company conducts an e-meeting. The
rise of e-meetings does signal an important emerging trend, the possible
end of proxy solicitation. In principal, shareholders can now
"attend" a meeting electronically, and vote on the agenda directly No
more "appointing" someone to serve as the shareholder's proxy. The idea
(and arcane, convoluted, confusing, and costly process) of proxy voting
basically goes away.
Of course, proponents of board nominees and meeting resolutions still
need to promote their candidates and issues, as we note in our
discussion of the new proxy access rules. Still, that's a good bit
different (and simpler and cheaper) than developing and distributing
proxy cards and materials.
Looks like we should continue to follow this.