First we should note the key assumption, and one we fervently wish for; that ‘the Covid coast will be sufficiently clear’ by year-end to allow people to plan for the possibility of in-person meetings. If not, all bets are off, and likely, there will be many more VSMs than ever.
That said, our bet is that a big majority of the small and micro-cap companies that held Virtual-Only meetings in 2020 will revert to the simpler and cheaper alternative of having the meeting at a local law firm - where, historically, few or no shareholders ever showed up and - importantly - where there are no shareholder proposals or important performance or governance issues in the press or potentially in the offing that might draw attention, much less a crowd.
We also bet that many of the large and mega-cap companies that had VSMs in 2020 will revert to in-person meetings….because they LIKE THEM - or, in a few cases, can’t risk shareholder and consumer backlash if they drop them.
On the other hand, a Virtual-Only Meeting - with no real live shareholders in attendance - has a great deal of appeal for a lot of large-cap and mega-cap company officers. So many companies will re-up and many newcomers may well sign up - IF the coast is clear with big investors, which is far from clear at this point. The many technical and logistical problems AND the demand for better and more “open” two-way communications can and will be solved…but it will take quite a bit of time and effort.
Always the optimists, we bet that there will be a big new uptake on so-called Hybrid Meetings - where folks can attend both virtually or in person. The 2020 season has shined a strong new spotlight on the true importance of shareholder meetings, and a Hybrid Meeting represents the best of all meeting models we say.
One last thing to note with care: Large shareholders will expect Directors to be intimately involved with any and all decisions concerning VSMs, going forward.
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