AGMs

Best practice proxy and voting outcome disclosure announcements


January 5, 2022

This page looks at examples of companies disclosing proxies to the ASX ahead of the AGM, plus those which provide the voting outcome by shareholders as well as the mandatory shares measure.

A transparency request that will be receiving increased attention in the period ahead relates to early disclosure of proxy votes.

Proxy voting closes 48 hours before an AGM starts and boards are usually provided an audited summary of the outcome the day before the meeting. There is no reason why this shouldn't be disclosed.

Very occasionally, boards do this when it is to their advantage or when the outcome is material, such as this announcement by Woodside in 2014 revealing that the proposed $US2.68 billion selective buy back of part of Shell's shareholding was likely to be narrowly defeated at the EGM the following day.

In pre-AGM emails to major companies, I'm starting to include a request for the proxies to be included in the formal ASX announcement which must be made before the AGM starts, including the text of the formal addresses, plus any slides which are proposed to be presented.

The proxy summary is literally the only slide that is withheld. For instance, here are the 49 slides which Macquarie Group presented at its 2021 AGM and lodged with the ASX before the meeting commenced. What is wrong with including a 50th slide summarising the proxy position, given it is going to be announced within a couple of hours to the meeting anyway? Besides, the proxies and the final poll results will then be lodged with the ASX after the meeting anyway, as you can see in this one page Macquarie announcement.

Finally, here is a reverse chronological list of companies which have included the proxy position in their pre-AGM ASX announcements. The goal is to grow this list and then make it standard practice, although that won't happen unless the ASX listing rules are amended, a change we will also be pursuing.

NAB: 2021: included the proxies in this 15 page pre-AGM announcement to the ASX.

Slater and Gordon 2021: lodged this separate ASX announcement before the AGM with each resolution having its own slide.

Afterpay 2021: see the last of these 37 slides.

Ausnet 2021: See the last of these 17 slides.

Afterpay 2020: See the proxy summary on the last of these 40 slides.

Seek 2011: See the proxy summary on slides 25 and 26 accompanying the CEO's presentation lodged with the ASX before the meeting.

The reason cited for not doing this, is usually based on not cruelling debate at the AGM or making it feel worthless for shareholders attending the meeting to vote on the day.

However, most retail shareholders attending the meeting don't look at the ASX announcements platform but for those interested in asking questions about the reasons behind any protest votes, they will have time to prepare. Disclosing the proxies BEFORE the debate on each item has been ASA policy for a number of years, but they haven't pushed it very hard and many companies still don't do it. In the case of the Murdochs at News Corp and Fox Corp, they just announce that majorities have been achieved on all items but don't provide the actual voting data until the SEC filing is lodged after the meeting.

During this recent online AGM season, a standard opening question of mine has been as follows:

Did any of the main proxy advisers - ACSI, Ownership Matters, Glass Lewis and ISS - recommend a vote against any of today's resolutions? Which of the proxy advisers are covering us and has their been a material proxy protest vote against any of today's resolutions? Will you disclose the proxy votes before the debate on today's resolutions so shareholders can ask questions if there have been any protest votes?

Voluntary disclosure of for and against votes by shareholder number

Another standard question that has been asked at virtual AGMs in 2021 has been as follows:

When disclosing the outcome of all resolutions today, will the chair support the idea of publicly disclosing how many shareholders voted for and against each item, similar to what happens with a scheme of arrangement? This will provide a better gauge of retail shareholder sentiment on all resolutions and was a disclosure initiative recently adopted by Metcash and Southern Cross Media after their AGMs.

And here are the links to announcements which have included this innovation:

Metcash, 2021: whilst the ASX announcement didn't include the outcome by shareholder number, this announcement on their website revealed the data. Interestingly, you can see in those Metcash figures that 99.6% of votes were in favour of the fee cap increase for the directors but it was only 53.5% of the voting shareholders (462 out of 871 who voted).

Altium, 2021: voting outcome announced to ASX.

Dexus, 2021: see best practice voting outcome announced to ASX.