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Dec 27, 2021

Climate and social issues expected to be front and center at AGMs

We explore the issues that have dominated – and will continue to dominate – AGMs, according to industry watchers, and look at how the Covid-19 pandemic has changed the way AGMs are conducted

Virtual meetings became the standard during the Covid-19 pandemic out of necessity and, with uncertainty over when the pandemic will end, the virtual format will likely remain the standard for the time being.

It is likely that, over time, the hybrid meeting will become the dominant format for AGMs, according to Paul Conn, president of global capital markets at Computershare.

‘I think, ultimately, it will come down to whether a hybrid meeting can be done cost-effectively,’ he says. ‘Where the law allows, companies will have virtual meetings. Large companies might offer streaming meetings or some form of participation remotely. You could authenticate shareholders who join virtually and allow them to vote. I think it will take three to five years before in-person meetings are not considered best practice.

Tom Skulski, managing director for proxy at Morrow Sodali, agrees that eventually hybrid meetings are likely to become the standard because those who preferred to be physically present could be, while those who couldn’t attend would at least be able to participate in the AGMs. There are some concerns, however, about boards being held accountable to shareholders with questions.

‘ISS did a survey over the summer; it found that a large number of investors who responded are concerned with the way companies are curating questions and how questions are allowed to be asked at meetings,’ Skulski says. ‘They are concerned that not all questions are being asked and answered. You would know this at an in-person meeting because you’d see how many people were waiting to speak.’

He adds that ISS and Glass Lewis are going to come out with their policy recommendations regarding holding AGMs before the end of the year.

‘It will be interesting to see whether they have changes in how they think virtual meetings should be run and whether they will give any guidance on future approaches by issuers,’ he says.


The issues motivating shareholders the most are environmental and social. There were 13 environmental and 20 social issues that passed in the US in 2021, compared with a combined total of 18 the previous year, according to Hannah Orowitz, senior managing director at Georgeson. She says ESG issues will continue to dominate the coming proxy season: ‘We are going to see more proposals asking firms about climate transition strategies in 2022.’

When it comes to social measures, Orowitz says new proposals at AGMs were related to racial equity audits, although none passed. Several garnered support of more than 30 percent, however, she points out. ‘I believe we are going to see more of this in 2022, asking companies to make commitments on racial equity efforts and have third-party experts reviewing those plans,’ she says. ‘We will see those proposals in 2022, and it remains to be seen how those proposals will increase.’

This year also saw heightened scrutiny on political spending. This, Orowitz says, will continue to be examined at AGMs in 2022, with investors examining how lobbying efforts are affecting companies’ climate and social goals. ‘Fallout from events at the Capitol in January and scrutiny over political and lobbying efforts – in general, not necessarily connected to environmental and social issues – will all be looked at,’ she says.

This is an extract of an article that was published in the Winter 2021 issue of Corporate Secretary sister publication IR Magazine. Click here to read the full article.


Mike Schnitzel

Mike Schnitzel is a freelance writer and editor based in New York. In addition to being a contributor to IR Magazine and Corporate Secretary, he is the technical editor at Refinitiv Lipper and freelances regularly for many different outlets. His...