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Bad AGMs and how to avoid them

9 February 2016

Charles Russell Speechlys were pleased to team up with the Quoted Companies Alliance and ICSA for an evening of essential tips to help avoid those difficult AGMs that no one wants to experience. It covered what to do if issues do still arise despite following these tips, in preparation for the 2016 ‘AGM Season’. To read our guidance notes on how to prepare for the difficulties which could arise at an AGM, please click here.

The event was based around an entertaining mock AGM role play, covering all aspects from the responsibilities of the Chairman, attempts to replace the Chair and amend resolutions, to handling the press and shareholder activism more widely. There was more than one unruly shareholder in the room, and through a series of questionable accents and props, the team were able to draw out the key issues and best practice when dealing with such demands. “Keep calm, and carry on” was the catch phrase of the event, with other more practical guidance covering the following.


It was agreed that preparation, and even rehearsing the meeting – was important and this was something that in-house teams, lawyers and financial PR agencies could assist with. Often Chairmen may not have been in this position before, or only infrequently.

Activist shareholders

Activist shareholders are not always to be feared, and may well be seeking a positive outcome for the company. However, it is important to manage this ahead of the meeting and engage and plan early. The Company should put themselves into the shareholders’ shoes and work with financial PR agencies and proxy agents to understand how the shareholders will vote and prepare responses to issues ahead of time.

A new breed of campaigner

There is a new breed of campaigner who is professionally trained to make their point effectively at company AGMs. They are prepared to articulate the particular issue at hand in a persuasive manner, to rally shareholders for change. This can include aspects such as the Company’s approach to the living wage, CSR policies and other emotive issues. Be prepared to respond to these protesters.

Involvement of the press

There was much debate on this issue. Generally speaking, the view was to allow press to attend the meeting. Members of the press could take shares or represent a shareholder in any case, and excluding them can present poorly. Messaging should be considered in advance and any obligations to announce or keep certain information confidential considered ahead of the meeting.

Proxy voting

Ensure you have full details of proxy voting ahead of the meeting, particularly if you are proposing a challenging resolution. Remember that shareholders can change their vote at the meeting itself (notwithstanding having already voted by proxy).

Gauging the mood of the meeting

Make sure that the mood of the meeting is taken into account, as well as the legal formalities. It may be for example that a procedural motion to seek the consent of the meeting to an exercise of discretion will help carry the room with you.

Role of the Chairman

The Chairman’s role is to represent the best interests of the Company and the Shareholders and to ascertain the views of the meeting (those present in person or by proxy or representative). It is important to facilitate the discussion and ensure that the views of the meeting are represented in the voting. Questions can and should be passed on to other relevant members of the Board where appropriate; chairmen do not have to field all responses themselves.

We were also pleased to host our annual AIM seminar in November, which surrounded the topic of shareholder activism. To read about this event and to view highlights of the panel discussion, please click here.

For more information please contact David Hicks on +44 (0)20 7427 6647 or at david.hicks@crsblaw.com