Sodali Memo – “Rethinking the Annual Meeting”

In previous years, Sodali’s Memo has been successful in bringing to the attention of practitioners concepts such as the convergence of Corporate Governance and Investor Relations, the role of the Board in communicating with shareholders and the rise of the so-called “value activism”.

The emergence of factors that are fundamentally reshaping the way in which companies relate to their shareholders and the persistence of elements of confrontation, exacerbated by the effects of the financial crisis, is challenging companies and practitioners to rethink the Annual General Meeting, to avoid being surprised or forced into a defensive posture or losing control of the event.

This year, the core ideas are:

Make the annual meeting a marketing event that highlights the company’s strengths rather than a forum for confrontation with shareholders.

– Treat shareholders as customers rather than as enemies, and bring to shareholder relations the same resources and techniques that are used in investor relations and marketing.

– Define a role for the board of directors in communication with shareholders.

– Beef up the content of explanations for decisions such as compensation, governance policies and other matters that are red flags for shareholders.

– Start preparing early and thoroughly for the AGM by doing benchmarking, internal analysis of strengths and weaknesses, shareholder surveys and dialogue with top shareholders and proxy advisors.

Download the report (click at lower right):

The Board Director Training Institute (BDTI) is a "public interest" nonprofit in Japan dedicated to training about directorship, corporate governance, and related management techniques. It is certified by the Japanese government to conduct these activities as a regulated nonprofit. Read a summary about BDTI here, and see a menu of its services for both corporations and investors here.

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