The new hybrid AGM for shareholders

March 25, 2020 11:58
CLP Holdings under chairman Michael Kadoorie has introduced the concept of "hybrid AGM" to fulfill a corporate requirement while protecting the welfare of shareholders. Photo: HKEJ

As the coronavirus pandemic rages, everything that can be postponed is being postponed – from the Tokyo Olympics to wedding banquets and court hearings. 

Public health is the No. 1 concern. But although gatherings and mass events are being discouraged, some things cannot be postponed or delayed.

People have to earn a living. Businesses simply can't grind to a halt. And so working from home has become the order of the day.

The current situation poses a challenge to listed companies as the season for annual general meetings is coming.

The AGM is a must. It is not only a statutory requirement for listed firms; it is also an important occasion for management to brag about their accomplishments and justify their shortcomings, as well as have important resolutions passed. It is, moreover, an event much awaited by shareholders as it is when they are spoiled with a good dim sum meal and a bagful of souvenirs.

So how does a company hold a public event without exposing management and shareholders to health risks?

After carefully considering the rapidly-changing situation, CLP Holdings (00002.HK) has come up with a "Plan B". The blue-chip utility under Michael Kadoorie has introduced the concept of "hybrid AGM".

On May 8th, CLP will hold its AGM at Kerry Hotel in Hung Hom, and the proceedings will be broadcast live online.

Registered shareholders have the option of attending the actual event or joining it online via their smartphone, tablet device or personal computer. They will not be able to vote, but they can shoot their questions to management online.

If one attends online, however, there will be no dim sum, and no souvenirs either.

In a circular to shareholders, CLP said: “As a token of appreciation to shareholders who participate at our AGM, the company has, in the past, made available AGM souvenir gifts to our shareholders.

“This year, the coronavirus situation has had a severe impact on the supply chain and we may not be able to source the AGM souvenir gifts in time for our 2020 AGM. We thank you for your kind understanding on this.”

According to CLP, more than 1,500 people attended the AGM in the past year. That number would have occupied about 150 tables in a wedding banquet, or about 20 times the size of a wedding banquet in Discovery Bay where a number of guests had been infected with Covid-19.

As it is rather difficult to predict what will be the coronavirus situation in Hong Kong in May, CLP asks shareholders to assess for themselves whether they should physically attend the AGM.

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CG

EJ Insight writer