Recent physical AGMs draw low attendance; preference for hybrid, electronic meetings

PHYSICAL annual general meetings (AGMs) are back, after the easing of Covid-19 restrictions on large gatherings, but companies and shareholders are lukewarm to the idea of in-person meetings after a 2-year hiatus.

Checks by The Business Times showed at least 5 companies had hybrid AGMs in July – namely Mapletree Logistics Trust (MLT), Mapletree Industrial Trust (MIT), Mapletree Commercial Trust (MCT) prior to its merger with Mapletree North Asia Commercial Trust, Singapore Post (SingPost), and Azeus Systems. 

This arrangement gave the shareholders of these companies the option to show up to the meeting in-person, or attend the meeting via electronic means. 

A spokesperson from Mapletree said there were 40 unitholders present at MLT’s AGM on Jul 18, and about 60 unitholders at each of the AGMs of MIT and MCT, which were held on Jul 19 and Jul 29, respectively.

The spokesperson said the figures were “encouraging” in light of the increase in Covid-19 community infections during the period. 

IT solutions and products provider Azeus Systems, meanwhile, had about 65 shareholders and observers who showed up for the physical AGM, while the electronic meeting was attended by some 70 participants. A spokesperson said these figures exceeded the company’s expectations. 

These companies revealed that shareholders appear to have a preference for virtual or hybrid AGMs, for now at least. 

In a survey by Azeus, which also supplies a virtual AGM software solution, about 78.6 per cent of shareholders polled were most keen on the hybrid AGM format. Another 16.6 per cent voted for the physical format, while 4.7 per cent voted for the meeting to be held entirely by electronic means. All the shareholders who wanted an electronic-only meeting were based overseas, an Azeus spokesperson said.

On why the hybrid mode emerged the top pick, a follow-up survey by Azeus showed top reasons were the ability to maximise reach, better engagement and greater transparency. 

“We intend to maintain the hybrid model of the AGMs to allow our shareholders the flexibility to participate both virtually and in-person,” said the spokesperson.

The company has observed an increase in participation and attendance from overseas shareholders based in Hong Kong, Malaysia and the United States over the past few years, compared with pre-Covid days when Azeus conducted only physical AGMs. This would “incur cost and travel time for them to attend the AGM”, said the company. 

Mapletree’s spokesperson said all its AGMs continued to have “meaningful participation” from unitholders attending virtually. 

“Unitholders appreciated the flexibility we have provided, especially the option of either asking questions in person or submitting text questions via the virtual platform,” said the spokesperson.

While SingPost declined to reveal figures of physical and online turnouts, the company said it received positive feedback from attendees for offering the choice of in-person or virtual attendance. A spokesperson also reckons a hybrid model for AGMs “works well for shareholder engagement”.

“We would still like to meet our shareholders in person, to build relationships, trust, and have greater interaction while also giving them the flexibility of joining the meeting remotely,” said the spokesperson.

“We will consider continuing with the hybrid model for future AGMs, subject to the prevailing regulations related to the holding of shareholder meetings.”

Virtual-only still popular option

While some companies are experimenting with hybrid formats, others are keeping their meetings fully virtual.

One reason given is that shareholders prefer it. For instance, mm2 Asia said it has not received any request from shareholders to “move away from the digital format”.

“We have only received positive feedback from some of our shareholders who welcomed the virtual AGM format as it was very time efficient and business-like as opposed to a physical meeting,” said the company. 

Boustead, meanwhile, said the turnout at this year’s virtual-only AGMs for Boustead Singapore and Boustead Projects was “about the same as last year”, but less than the turnout of the physical AGMs held before the pandemic. 

“Given the evolving nature of the Covid-19 situation and government warnings on the then-new and more transmissible Omicron variant, our boards and management teams decided to approach the AGMs in a risk-managed manner,” a spokesperson said. 

But the group added that in terms of total votes cast for resolutions, there were no significant differences between its virtual AGMs and the pre-pandemic physical AGMs.

Higher costs versus better engagement

In May this year, Singapore Exchange Regulation (SGX RegCo) stated in a column that listed companies should ensure that shareholders are accorded “full meeting rights” even at virtual meetings. These include the ability to ask questions, appoint proxies and vote at AGMs. 

The first meetings under these alternative arrangements are expected to be held in October this year. 

Hybrid AGMs that include such interactive elements, however, can be expensive

Yap Jia Rern, who heads Azeus’ division for its virtual meeting platform ConveneAGM, said a physical or virtual AGM costs at least S$5,000. Charges for a hybrid AGM can be 2 or 3 times that amount, Yap said at a panel discussion on Monday (Aug 29) entitled The Evolution of AGMs: The New Hybrid.

One of the major contributors to the jump in price is the equipment needed for filming.

Michael Tang, vice-president and head of listing and product admission at SGX RegCo, said real-time electronic voting and real time electronic communications will play a part in “ensuring full and substantive participation of shareholders”.

Companies should therefore start looking into how to do so.

Just as the removal of the mask mandate in most public places – which took effect on Monday – has given people an “agency to act”, and allowed them to make their own “deliberate, considered decisions”, listed companies too will now have to consider their shareholder base and feedback from shareholders before making a decision on the format of their AGMs, said Tang.