…Or To Tick Off Your List Before The Big Day Looms…
Your editor unexpectedly missed his planned appearance in Broc Romanek’s annual Annual Meeting Planning Webcast, with luminaries like Dannette Smith of United Health Group, Susan Permut, of EMC Corporation, John Saia of McKesson and Grace Holmes of Cameron International.
A transcript of the webcast is available on the corporatecounsel.com website, which we urge you to review before your meeting date.
Normally, we sort of “sweep up” and sometimes polish up a few of the stray housekeeping details, based on experiences from the 400+ shareholder meetings that we and our now 35 Inspector of Election associates attend each year. So we can’t resist adding a few points – plus a few “counter-points” to the excellent practical tips the webcast contains:
On the use of hotels: We, as sort of “control freaks” where shareholder meetings are concerned, absolutely agree with Dannette Smith’s tip that using a company facility “where one can be in complete control of the environment” is the best way to go…And it’s usually the most cost-effective way to boot. But if your corporate space does not allow you to be completely in control – or if there may be issues with unexpectedly large attendance, a larger than usual number of potential troublemakers…or, the thing we ourselves always check on first – if you are not absolutely certain that there will be a safe and orderly way for a large crowd to exit quickly in case of an emergency…DO think about using a hotel, where such considerations are normally built-in to the design and management and operational structures. Also, as we’ve noted before, people who may think and act in a company facility as if “they own the place” tend to be on their best behavior (albeit still not so nice) in a nice hotel. And best of all, as we experienced at a meeting last year, it’s a lot better for the hotel management to be the “tough guys” when it comes to strictly enforcing the rules – which greatly decreases the possibility that your company will be depicted as a big bad bully.
On employee attendance: Most of the panelists tended to discourage employee attendance at the shareholder meeting
– and that is quite understandable: Aside from potential crowd-control issues, the meeting is almost always archived on the web these days…and hey; most employees have WORK to do the day of the meeting….But we hark back to a Whole Foods meeting we attended and wrote about a few years ago, where a big and enthusiastic crowd of very happy employee-shareholders turned out to see their big bosses up close - and to cheer on the good results – and completely took the wind out of activist investor sails. Quickly sensing their lack of popularity, the activists hurried through their proposals, drastically shortened the long statements they had in hand – and, quite properly, had to take their second turns at the microphones behind long lines of employees – and enthusiastic customers too – who wanted to focus on day-to-day business issues…like when more stores would be opening near them. [We like the “family hold back” policy regarding employee attendance – where employees are reminded to give up their seats to outside stockholders if there are unexpected crowds, and maybe to watch from the overflow room…But having lots of “friends and family” at a shareholder meeting is tops in our book, as a way to have a friendly and “family-oriented” meeting instead of a shouting match.]
On whether directors should be facing the audience: Different strokes for different folks, and maybe for different days too, but the very best remark we’ve ever heard on this subject came from Ivan Seidenberg, the former CEO of Verizon Inc., when he was asked by a shareholder ‘why are the directors not facing us?’: “They are doing their most important job” he responded, without a moment’s hesitation; “They are watching ME…And believe me, if I flub anything in their opinion, I will hear about it from them right away.” [As frequent meeting attendees, we like it best of all when directors turn around completely and stand up straight when introduced, maybe wave, or smile, or otherwise acknowledge the shareholders…and remain standing and facing the audience until all directors have been introduced - and applauded as a group. We cringe when directors barely pop up, turn around halfway and sit right back down as if maybe they’re embarrassed to literally stand up and be counted, and recognized by meeting attendees. Please put this tip in your meeting kit-bags, we urge you: It really helps to set the right tone – and to make a very fine opening impression on the audience.]
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