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Marks & Spencer’s AGM sparks heated debate on Share Your Voice campaign


During the pandemic, listed companies in the UK were compelled to hold their AGMs virtually, but since then the advent of the technology used during those dark times has encouraged some to propose holding all their AGMs virtually. But is this a good idea?

M&S chairman Archie Norman is arguing that digital AGMs will enhance shareholder engagement in the UK, especially with retail investors.

Marketwide AGM attendance in the UK was down c.55% in 2022 and recent Quoted Companies Alliance research has found that 53% of shareholders didn’t attend AGMs as they were too far away. However, M&S says it has bucked this trend and participation has more than trebled in the last three years.

“Current legislation requires shareholders to either not work or take time off, be able to travel – often to far flung places – where AGMs are held,” Norman says. He wants a reform to UK companies legislation removing the requirement to state the place and the requirement for two qualifying persons to be present for the meeting to be quorate. To ensure transparency, he says all submitted questions must be answered during the meeting or published, with a response on the company website, within 48 hours of the meeting conclusion.

“All investors – no matter how they hold – will benefit from more democratic engagement, with more informed, regular communication, reduced time and travel requirements and fundamentally a more level playing field regardless of where they live, what they do, and level of confidence in public speaking,” Norman says. “Companies will benefit from more engaged shareholders, cost efficiencies and a dismantling of unnecessary bureaucracy. In doing so, we will make UK public markets a more attractive place to invest and a more attractive place to list.”

M&S sounds out of step with the industry however

Removing the obligation to hold a physical AGM also makes it tougher for some investors to interact with company management, however.  The Engagement Appeal campaign, founded by stock investors Sheryl Cuisia and Danny Wallace, is arguing against the proposals put forward by Share Your Voice. They note that M&S itself discouraged shareholders from attending its 4 July AGM in person.

In its communications with shareholders, M&S said: “Shareholders are advised not to travel to the venue on the day, as the meeting will be fully digitally-enabled. Board members will not be available for interaction with shareholders in person, as they will be taking part in the meeting broadcast under studio conditions. Any shareholders travelling to the venue against the Board’s recommendation will be advised to join the meeting electronically, and will be provided with assistance to do so, if needed. Refreshments will not be provided.”

This certainly sounds like a company that is not keen to interact with its shareholders – effectively the owners of the business – in person.

Most independent bodies are proposing a hybrid arrangement for AGMs – i.e. investors can join virtually if they are unable to make it, but still have the option to attend in person. The bulk of the key investment bodies, including Institutional Shareholder Services, Glass Lewis, the Investment Association and the International Corporate Governance Network still advocate the hybrid AGM as the optimal format.

The Engagement Appeal also points out that even groups like the UK Shareholders Association, early supporters of Share Your Voice, have now backed away from its proposals, and are recommending hybrid AGMs.

Virtual AGMs will lose their impact

“The UK is incredibly disengaged when it comes to shareholders,” Danny Wallace of the Engagement Appeal told The Armchair Trader. “Virtual AGMs lose their impact for shareholders, virtual questions get vetted, paraphrased by IR teams and grouped together. You can meet some incredible investors at physical AGMs and hear them ask questions. But you need physical attendance to make this work.”

He calls out the last Sainsbury’s AGM as an example of how to do it, with management answering investor questions for 90 minutes. M&S, by contrast, comes across like a televised fireside chat. AGMs provide investors with an opportunity to come together and meet other stakeholders as well. For younger investors, physical AGMs can also provide a useful opportunity to hear what some veteran investors are asking company management.

What’s motivating M&S here? We suspect an effort to remove the need to take difficult questions from the floor, sometimes from very well informed private individuals. Chairs are also keen to mute the activities of activist groups, not only environmental campaigners, but sometimes also hedge funds. But by doing so, they are also undermining a critical part of the overall stakeholder culture that makes share markets work in the first place.

Many companies and boards talk to us about how important small investors are for them, but it does smack of hypocrisy for big companies like M&S to begin encouraging their investors not to attend their AGM and also to seek further legislation which removes any requirement for them to host physical AGMs for their owners in the future. We hope the UK government sees Share Your Voice as the cynical ploy it is.

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This article does not constitute investment advice. Do your own research or consult a professional advisor.

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