2017 AGMs: A Season In Review


Georgeson's annual review of the FTSE companies' meetings.

It has been an intense annual general meeting (AGM) season, with an increased focus on diversity and new regulations on the horizon. We have seen that executive pay remains a substantial issue in many European markets, alongside increased attention on director elections.

As in previous years, the season continues to extend well beyond four months in spring, with passive investors, who track indexes and cannot sell their holdings, concentrating more on their governance teams and how they exercise their voting rights.

Our review of the 2017 UK AGM season analyses companies that held their AGMs between 1 August 2016 and 31 July 2017, and which were part of the main large-cap stock market index (the FTSE 100 and FTSE 250 indexes).

The review looks at AGM participation levels, rejected and contested resolutions and proxy advisor recommendations.

Participation levels

The participation levels of a company's AGM can indicate how engaged its shareholders are, although it is also dependent on factors such as the meeting type and location of its shareholder base.

Low participation levels pose a particular risk to companies as they magnify the voting power and influence of minority shareholders or activist investors at the meeting.

During the 2017 AGM season the average participation was 73.4% for the FTSE 100 and 73.3% for the FTSE 250. Over the past five years the average participation for the FTSE 100 has been steadily increasing and stands 2.4 percentage points higher than participation levels in 2013.

However, for the first time in five years the average participation of the FTSE 250 has fallen below that of the FTSE 100 (the 73.3% is down from its 74.1% peak in 2015).

"Low participation levels pose a particular risk to companies as they magnify the voting power and influence of minority shareholders" Across the main European markets, participation levels have remained constant, with the mid-cap indexes in France, the Netherlands, Germany, Italy and Spain having a higher participation than the large-cap indexes.

For the large-cap indexes in 2017, Germany had the lowest average participation level at 60%, while the UK had the highest participation (73.4%).

Rejected resolutions

Across the FTSE 100, two companies each had one board-proposed resolution rejected by shareholders during the 2017 AGM season: Pearson and Old Mutual.

In the FTSE 250, five companies each had one board-proposed...

To continue reading