Demonstrations in front of the event hall, persistent questions from the hall and lively debates between shareholders and company management: At general meetings, shareholders have also loudly sought their way to make themselves heard in the executive floors.
But since the first year of Corona, things have calmed down around the annual shareholder meetings, at which the Management Board and Supervisory Board answer questions from the shareholders. Because of the pandemic, companies have often held their general meetings online over the past three years. The majority of the Dax companies want to stay there.
More than half of the 40 largest companies on the German stock market are already planning a purely digital general meeting again this year. This emerges from a survey by the German Press Agency. 22 Dax companies are planning online formats, only 10 companies have decided to hold a face-to-face meeting - including BASF, Henkel, Airbus and Porsche. The decision is still pending for 7 companies. A company did not provide any information.
Hybrid format required
There is a lot of criticism of the purely digital general meeting from shareholders. German shareholders' protectors see the opportunity for a lively exchange between shareholders and company management at risk and are calling for a hybrid format instead. "The annual general meeting is a very important part of the share culture in Germany," said Daniela Bergdolt, Vice President of the German Association for the Protection of Securities (DSW). "The lively, critical dialogue between companies and shareholders is best implemented when they are present."
The possibility of holding an annual general meeting without the physical presence of the shareholders was introduced at the beginning of the corona pandemic. The annual meetings, at which thousands of people usually come together to vote on dividend payments, capital increases and the discharge of the board of directors and supervisory board, were allowed to take place online. Last summer, the Bundestag made the special regulation permanently possible with certain changes. The rights of the shareholders should also be fully guaranteed online, for example through a live inquiry right.
Benefits for corporations
According to companies such as Beiersdorf, Merck, BMW, Siemens and Vonovia, which also decided to hold an online general meeting this year, the new format has proven its worth during the Corona period. The Dax companies see various advantages: You have more planning security, protect the health of those involved, costs, effort and CO2 emissions are saved by traveling and the participation of more and international shareholders is made possible.
With the annual general meeting online, the sometimes high costs for room rental, catering and staff are eliminated. The healthcare company Fresenius says it has saved around a quarter of the costs with the online format over the past two years compared to previous face-to-face meetings. The materials manufacturer Covestro and the energy company E.ON even expect cost savings of around 50 percent. Other companies put the difference in a six-digit euro amount. However, many also said that lower costs were not a factor in their decision.
voting among board members
With the approval of the supervisory board, the executive boards of the stock corporations can still decide up until August 31 whether this year's annual general meeting should be held in person or online. After that, an amendment to the statutes is needed, which can specify the online format for up to five years or authorize the board to also hold the meeting online during this period. The proposal to amend the Articles of Association is on the agenda at a number of general meetings this year.
“Shareholders – both private and institutional – will reject a general authorization for a period of one or two years without specifying the structure of the virtual general meeting and the shareholder rights,” says Marc Tüngler, CEO of DSW. The shareholders therefore want to know specifically how their rights are structured or, if necessary, restricted in the online format, and call for an open discussion about the future format of the general meeting.
The Munich energy group Siemens Energy will start the Dax general meetings on February 7th. Here, too, it remains for the time being at the investor meeting on the Internet. The company announced that shareholders should be able to ask their questions live in the video conference. "In this way, interactive dialogue is also made possible in the context of a virtual event," it says.