More companies offering live Q&A at AGMs, but many still reluctant to fully embrace tech features
Given the convenience to shareholders and cost savings for companies, listcos would do well to invest in more interactive meetings sooner rather than later
By MICHELLE QUAH
The Business Times, 28 April 2021
AS THE Covid-19 pandemic persists, the need to keep shareholder meetings virtual remains. Yet, while Singapore-listed companies can be said to be doing a better job this year in trying to create more meaningful engagements with their shareholders, the seeming lack of enthusiasm with which many have been approaching this suggests that a significant number of retail investors could be left at a disadvantage yet again.
In 2020, a total of 630 listed companies held at least one meeting - but only six held virtual meetings with a live question-and-answer (Q&A) session and, of these, only one held a meeting with a live Q&A and live voting.
"The meetings of the other 581 companies were almost exclusively conducted using webcasts, which did not allow for interactions at the meetings. Social distancing became investor distancing at shareholder meetings," said Mak Yuen Teen, an associate professor of accounting at the NUS Business School, who authored The Singapore Report on Shareholder Meetings: The Rise of Virtual Meetings.
The sole company that held a virtual meeting in 2020 with a live Q&A and live voting was Azeus Systems - which provides IT consultancy services such as those that help companies hold virtual meetings. The company's clients make up about one-third of the listed companies in Singapore, and its Business Development and Partnerships manager, Yap Jia Rern, spoke to The Business Times about the take-up rate for its services this year.
"Last year, we had only a handful of listed clients who conducted live Q&As (during their virtual meetings), but this year we have seen a surge of requests for live Q&As and hybrid meetings," she said.
Among its listed-company clients that have taken up live textual Q&As - where shareholders can send in their questions in a live textual format - for this year's AGM (annual general meeting) season are Genting Singapore and Wilmar; while ComfortDelgro, SBS Transit, and Vicom are among those that will hold hybrid meetings with a live Q&A.
One other client is going a few steps further: wealth management fintech platform, iFAST Corporation, will be utilising most of Azeus Systems' features in its AGM this year; it will provide for the appointment of third-party proxies (other than the chairman), two-way live Q&A (textual and video), and live voting (remote and for onsite shareholders).
"It will be the first listed entity in Singapore to do so with a hybrid AGM encompassing all of these features," Ms Yap said.
Azeus Systems, meanwhile, was the first to incorporate all of these features in a virtual AGM - which it did last year - and it will be doing the same again this year.
The increased adoption of the live Q&A feature has also been noted by Boardroom, which offers corporate and advisory services such as corporate secretarial services.
It told BT that it had only two clients adopting live Q&A sessions in their virtual meetings across the whole of 2020, but that nine clients have already signed up for this feature in this April season alone, with notable names including DBS Bank, Capitaland, OCBC Bank, China Everbright and ESR-REIT.
Jason U, Boardroom's head of Share Registry Services & Employee Share Plan (Asia), said: "Large-capitalisation companies are driving the trends in virtual AGMs as they adopt different technological features such as live Q&A in anticipation of the shareholder engagement trend continuing."
Still, as laudable as this development is, it also throws the spotlight on what listed companies are not doing.
Ms Yap said, "We definitely see a shift in using our live features this year, though our observation is that listed entities are still more keen to embrace them progressively - in other words, many will take up the live Q&A this year, and then live Q&A and live voting next year."
In contrast, many of Azeus Systems' non-listed clients chose to adopt multiple live interactive elements in their meetings last year and will continue to do so this year - organisations such as the Securities Investors Association (Singapore), the Singapore Institute of Directors, Tanglin Club, German European School Singapore, the Singapore Association of Convention and Exhibition Organisers and Suppliers, and the Singapore Indian Chamber of Commerce & Industry.
"Ten (10) per cent of our meetings have live Q&A and live voting; the majority of which are taken up by non-listed issuers," Ms Yap said.
Boardroom said the reluctance on the part of listed entities could be due to a common misconception that the introduction of new technology, specifically, live Q&A, is costly. "We have also seen many companies feel daunted by the introduction of live Q&A as there is a belief that the technology is new and from a risk management standpoint, companies want to eliminate variables so the AGM runs smoothly," Mr U said.
Ms Yap explained, however, that cost should not be a consideration, as Azeus Systems charges the same rate for a meeting with live features, such as live voting and live textual Q&A, as it does for a standard meeting solution. "We are of the mindset that this is the baseline of any AGM, as the primary purpose of an AGM is to serve as a platform to facilitate discussions between the company and its shareholders. Regardless of the format, the essence of an AGM is lost if companies do not allow for meaningful engagement."
She also said that host capacity is not an issue, as Azeus Systems has the capacity to host large and long-running virtual meetings. Some of the larger meetings it has hosted boast an attendance size of around 6,000 people, such as the one it hosted for the United Nations Sacco Society or UN SACCO; and it has hosted meetings that run close to eight hours long.
Both Boardroom and Azeus do agree that preparing for and hosting a virtual meeting with live elements is generally more time-consuming and complex than one without.
Yet, the comparative willingness of non-listed entities to include such elements is food for thought. And the prediction that virtual or hybrid meetings could be the way of the future, with or without the scourge of the pandemic, suggests that listed companies would do well to invest in more interactive meetings sooner rather than later.
Mr U said better education and awareness are needed to encourage more companies to take on live interactive elements in their virtual meetings; he added that policy changes in the form of regulatory changes to support the use of live Q&A should also be considered.
Ms Yap added, "We definitely see virtual and/or hybrid AGMs as the way of the future, even after the pandemic, as it provides the flexibility for companies to have a fuller engagement with their shareholders."
She noted that, for some companies, these would even be less costly, as they will not have to bear catering, venue and travelling costs; and it would allow investors to attend more meetings, most of which tend to be clustered around the same time.
Prof Mak added: "I'm glad companies like OCBC Bank have live Q&A; and that Genting Singapore chose to have live textual Q&A, despite the anticipation of a heated AGM, given the questions relating to its remuneration practices. Contrast this with Sabana Reit, which has opted to not only not have live Q&A but to limit the number of participants at their virtual meeting to 500 unitholders.
"Overall, we are still seeing quite a number staying with the same format as last year, so the change is going to be gradual. But I hope that meetings of the future will be hybrid in nature, and allow shareholders attending virtually to ask questions and vote live".