It's AGM season!

In the corporate world, PR and IR (Investor Relations) departments work around a schedule of required legal filings and meetings aimed at ensuring investors have timely information on which to base their investment decisions. One of the key elements of this schedule is the Annual General Meeting of Shareholders, or AGM.

In Canada, the AGM for a publicly-traded corporation has to be held within six months of the end of its fiscal year; since many public companies' fiscal years end on December 31st, hotels and convention centres in larger cities tend to come alive with AGMs in the spring.

If you watch the business section of a major city's newspaper, you'll see official "notices" (that is, ads providing the date/time/location/agenda) of AGMs. [Some people actually scour the papers for these notices and plan to attend the ones known for their catering. One event organizer here in Winnipeg once told me about two regulars he used to see at AGMs; he (kind of) affectionately referred to them as "Mr. Cheese" and "Mr. Crackers," as their "investment interests" only involved companies whose AGMs offered lunch.]

Anatomy of a corporate AGM

A corporate AGM is generally divided into two parts: the "legal business," and the executives' report.

The "legal business" of the meeting is called that because the company is required to conduct it at a public meeting, of which investors have received a set length of advance notice. The legal business includes: the acceptance of the annual report and auditors' report; the election of Directors; the appointment of auditors; and shareholder votes on any issues put to them by the company or individual shareholders (within specific legal parameters). Unless there's a particularly complicated vote taking place, the "business" of an AGM often takes less than 15 minutes.

Once that's out of the way, many public companies take the opportunity to speak directly to their investors in a presentation about the last year's performance, what's going on in the industry, and an outlook on the year ahead.

Sizes and tones as diverse as their companies

For some publicly-traded companies, an AGM is a meeting in a boardroom with fewer than a dozen people physically present (with potentially thousands of other shareholders represented by mail-in votes called proxies). For others, it's a large-scale to-do in the ballroom of a big hotel, or a convention centre, in front of hundreds of people (also with potentially thousands of other shareholders represented by proxy).

At some AGMs, there are blow-your-socks-off graphics and a/v presentations; at others, just an executive and a microphone (or, no microphone). At some, fancy luncheons; at others, no refreshments. At some, product displays, giveaways, demonstrations, etc. etc. etc. You get the picture. A company's approach will depend on a number of factors, including the locations of its shareholders and the nature of its business.

Widespread broadband access has made it possible for companies to open the online "doors" to their AGMs to a far wider range of investors and interested audiences (e.g. customers, employees working in locations other than the company's "home" city, etc.). Visit the investors' section of any major publicly-traded company's website, and you're likely to find a link to the webcast of its most recent AGM.

Others, like NIC, whose slogan is "the people behind eGovernment," are taking the online AGM to another level by simulcasting their AGMs in Second Life.



Boring, stodgy, stuffy? Not necessarily!

Done well, an AGM can be a great communication vehicle for audiences well beyond a company's shareholders. It can inform, motivate, inspire, entertain, energize, and galvanize loyalty and support.

And because the media tend to be interested, a company's opponents will sometimes choose the AGM to bring public attention to their causes, bringing another level of "excitement" to the meeting. For instance, here's Greenpeace hijacking a Nestle AGM:



OK, maybe not so exciting.

In other cases, groups of activist shareholders with enough votes behind them will replace the Board of Directors at an annual general meeting -- though the drama usually takes place behind the scenes. If you read a news release about an AGM that saw the election of a group of new directors and the resignations of a group of existing directors who were supposed to be up for election at the AGM, it's fair to suspect a hostile takeover. You may not see much in the way of drama from the podium, but you can trust that it's playing out in the boardroom.

While I've never had to deal with activists in the rafters (note to AGM planners: involve security!) or a hostile takeover attempt, I've seen a few memorable AGMs; at one, arriving shareholders were greeted by throngs of picketers in the streets.

CreComms: want to attend a corporate AGM?

Manitoba Telecom Services Inc.'s Annual General Meeting is scheduled to take place the morning of Thursday, May 6th at 11:00, at The Hotel Fort Garry in Winnipeg. MTS has offered to include any CreComm students who would like to see how an AGM works; if you would like to attend, please email me and I will have your name added to the guest list.