For the past few years, the idea of conducting online Annual General Meetings (AGMs) has been a topic of much debate in Australia and New Zealand. Whether these meetings are conducted solely online (virtual meeting), or as a combination of online and in person (hybrid), the consensus has been that some form of online shareholder participation is inevitable.
In 2016 the waters were tested by some newly listed ASX organisations holding their inaugural AGMs in a hybrid format. While in New Zealand, companies such as Spark, Xero and Air New Zealand also opened their meeting to remote attendance. Building on the success of these meetings, the 2017 season has seen the concept adopted in increasing numbers on both sides of the Tasman. Fletcher Building, SmartPay, Computershare and South 32 have all utilised features available in Lumi’s AGM app such as; allowing shareholders and proxies to view proceedings via a webcast, ask questions of the board and vote on the items of business.
It’s not just publicly listed companies that have adopted the trend. Both the Royal Australian College of General Practitioners and the Australian Shareholders Association (ASA) have used this platform to engage with their members. The ASA meeting saw the number of online members more than double those in the room, providing strong vindication of the approach. By taking the role of an early adopter, the ASA also now find themselves able to advise companies on best practice as they encourage them to follow their lead.
In moving towards an online approach this region looks set to follow the lead of the USA and Canada where virtual and hybrid meetings are increasingly considered the norm. It is easy to see why it is these regions which are spearheading change. All four countries have a widely dispersed population. Physical,in-room only meetings, through their geographic inaccessibility, disenfranchise most shareholders. Only those living or working within proximity to the venue who have no other commitments during the day, can attend and this is unlikely to be representative of the shareholder base as a whole
It is therefore no surprise that research published by Computershare reported that in 2016 only 0.16% of shareholders attended the meetings of ASX listed companies. A knock-on effect of this is that the quality of debate in Q&A sessions is often lacking as a diversity of opinions aren’t represented, an issue resolved using in app messaging. Moreover, Lumi’s experience would suggest that an app is more likely to encourage more people to raise questions than the often intimidating experience of walking up to a microphone.
From a legislative point of view, there appear to be no barriers to the adoption of hybrid meetings. With the Australian Corporations Act stating that:
“A company may hold a meeting of its members at 2 or more venues using any technology that gives the members as a whole a reasonable opportunity to participate. (249s)”
Therefore, provided that at least one physical venue exists for shareholders to meet the board face to face, there is no limit to the amount of virtual ‘locations’ also permitted. The relevant legislation in New Zealand goes a step further, the Companies Amendment Act (no2 2012), specifically permitting participation through electronic communication.
With Lumi’s AGM app now established as an effective platform to empower shareholder attendance at meetings, early adoption by ASX/NSX top 50 organisations and no legislative impediments, 2018 looks set to be the year that Australasia moves its meetings online.