How And When To Properly Open And Close The Polls

Over the last two years a mini-debate broke out sporadically over LinkedIn on how best to manage the opening and closing of the polls. Many activist investors felt that they should remain open until after the general Q&A period - and ideally, until the very end of the Meeting - so voters would have time to change their minds if something they heard rubbed them the wrong way. Quite a few well-meaning companies adopted this procedure, which, while nice, left an awkward pause at the end of the Meeting and a big question mark as to when to give ‘fair warning’ - and to actually shut the polls down. 

Others felt that the polls should close immediately after all of the proposals on the agenda were introduced - and discussed, if there was indeed a “discussion” - after “a brief pause to allow voters to vote or change their votes.” No big problem at in-person Meetings, where management could observe whether people were still trying to fill out ballots - but highly problematical at VSMs, where there is no way to know if people are still trying to vote.

Imagine our consternation when we reviewed the script for an upcoming Meeting at a major company - with eight proposals on the agenda - that said, “We will pause for five seconds to allow you to vote or change your vote online.” Yikes! While yes, five seconds of silence can seem like an eternity, it is physically impossible to review and potentially change one’s votes at a VSM in a mere five seconds. What to do???

Here’s what we came up with - and what we’d recommend as the “best practice” for opening and closing the polls where there is online voting:

• Declare that “the polls are now open for voting” when the Meeting is called to order - or, at the very latest, when it is time to begin the introduction of all proposals on the ballot, i.e., “the official business of the meeting.”
• Our own view is that the “best practice” is to introduce proposals one-by-one - and to ask if there is any discussion, which most of the time these days is no - but if so, to hear it then and there. If there is any discussion, allow a brief pause (a few seconds should be fine here) for voters to amend their votes if they wish to, before moving to the next item.
• When all the proposals have been introduced, move to the General Discussion Period - and announce that the polls will be open for 10 more minutes “to allow voters who have not yet voted or who wish to change their votes online to do so.” Yes, a few holders may have to ‘multi-task’ but so be it, we say.
• At eight minutes into the Q&A provide “fair warning” that the polls will officially close in two minutes.
• If at 10 minutes into the Q&A there are still questions coming in you might consider a “last an final warning” that the polls will close - and perhaps allowing one or two extra minutes if your own schedule permits before closing the polls and making final remarks, thanking attendees and declaring the Meeting “concluded” … But a ten-minute period for online voting, once all the proposals have been introduced, amply meets our own “Inspector’s sniff-test” for fairness to attendees and should be fine with shareholders and shareholder proponents alike.