make space in AGMs to talk to public, firms toldMay 2000
Companies should look at the idea of creating ‘separate space’ for stakeholder dialogue at their annual general meetings, (AGMs) a think tank has said.
The UK-based Centre for Tomorrow’s Company argues that businesses should also consider including specific agenda items at AGMs ‘allocated to customer relationships’.
The recommendation comes as pressure groups in Europe begin to increase their use of ‘social’ shareholder resolutions at the AGMs of large companies.
Last month BP Amoco’s proposed Northstar oil project in Alaska was challenged at its AGM by an alliance of American and British shareholders marshalled by Greenpeace and Trillium Asset Management, an American investment corporation.
Centre director Mark Goyder said separate sessions for stakeholder dialogue could address concerns about a company in a more effective and less confrontational way. ‘The best companies will be thinking about new formats for their AGM that not only fulfil their legal function but add a whole new dimension of engagement and dialogue with shareholders and stakeholders,’ he said.
In Corporate reporting jigsaw, a report based on a Centre for Tomorrow’s Company seminar held last October, the think tank says opening up AGMs could benefit all parties, and that ‘the most important and value-creating insight of the year may come from a conversation with a customer, shareholder, an informed questioner or a non-governmental organization’. It also says AGMs could, ‘like an annual report, have agenda items allocated to the customer relationship’.
Various companies discussed the ideas at the seminar, which included representatives from Allied Zurich, Hanson, National Power and Wickes.
At the BP Amoco AGM, Peter Sutherland, the company’s chairman, delivered a detailed four-page response to a resolution put forward by the alliance calling on the company to scrap Northstar and redirect the money to solar energy projects. The resolution was supported by 13.5 per cent of shareholders who voted, (or 7 per cent of the company’ s shareholders).
‘Social’ shareholder resolutions are relatively common in the United States, but Friends of the Earth has said it will consider using the approach more frequently in Europe.
Greenpeace recently bought a 1250,000 stake in Royal Dutch in an attempt to pressure the company to invest more in solar energy. More than 100 of its protestors plan to attend the company’s AGM on 9 May.
Another oil company, Totalfina, recently faced what was thought to have been the first attempt to put forward a ‘social’ shareholder resolution in France over its environmental record in the wake of an oil spill caused by the shipwreck of the Erika tanker in December 1999 off the coast of Brittany. Although questions were asked about the situation at the AGM in Paris, dissident shareholders were unable to put a resolution on the table.
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