Some Notes From The Virtual-Meeting Front

So far this season, there have been 20 “Virtual Shareholder Meetings”: About half were “totally virtual meetings” - held totally in cyberspace – and the rest were so-called “hybrid virtual meetings” where non-management share- holders were provided with a physical place where they could attend if they wanted to.

We are big fans of Virtual Meetings – because we believe that, when properly conducted, they fulfill our own vision statement as to what public companies should always strive to do: “Provide better and more cost-effective services to investors.”

Here are a few statistics and a few notes on meetings in general, which your editor discussed during a recent Forum on VMs hosted by Gary Lutin: (the full conference is available on the Forum website)

• 3,368 Annual and Special Meetings Held between February 15 and May 1, 2010 (Source: Broadridge Financial Solutions)
• Broadridge projects that over 13,800 annual and special meetings of shareholder will be held this year
• 20 “Virtual Meetings” this year, with an equal number projected for the second half of the year
• CTH&A Inspectors served at roughly 250 of the 2010 meetings to date…including two “Virtual-Only” meetings and four official “proxy contests” (The two virtual meetings our Inspectors attended and one we listened in on were all conducted quickly - and without a hitch.)
• The statistical “mode” re: the duration of the meetings our reps attended was one-half hour: More than two-thirds of them lasted one-half hour or less, and several dozen lasted less than five minutes
• Attendance at shareholder meetings was up modestly this year, after many years of year- over-year declines, but at the vast majority of meetings we attended there were fewer than five non-management shareholders in attendance…and in at least 10 meetings our team  attended, there were NONE

These statistics indicate that there are huge opportunities for public companies to save money on meeting logistics and on the meeting sites themselves – while making the meeting accessible to a much greater audience than a physical meeting place normally attracts.

We especially like the “investor forum” feature - that allows actual, “system-validated” investors in the company (and non-investors too, if the company wishes to hear from them) to ask questions and exchange views well in advance of the meeting. This gives companies a much better understanding of the things that are truly important to investors. It gives all participants time to formulate and answer questions thoughtfully, and to ask thoughtful follow-up questions. Best of all, the Q&A can be shared much more widely than a physical meet- ing would normally permit.

We still believe, as we’ve said from the get-go, that sometimes there are circumstances where investors want to speak directly to the company management team, and to directors, and to other investors too. But we see no real problems with accommodating such investors - whether they wish to appear at the meeting site in per- son, or by a telephone hookup, or via a live or prerecorded video transmission.

Two websites to visit if you wish to have a better under- standing of the cost-saving and information-sharing opportunities that are out there:

For a “virtual only meeting” – which had only two “routine matters” to be decided (as the vast majority of meetings do), a 92% quorum – and where not even one question was asked - and which took a mere 10 minutes from start to finish, go to www.warnermusic.com 

For a wonderful example of how to reach out to - and connect with - a much wider audience than an in-per- son-only meeting could possibly attract in a cost-effec- tive manner, go to www.bestbuy.com