In the third edition of our popular webcast series, Ana Giraldo, Chief Risk Officer, discusses the impact of COVID-19 on AGMs.
The peak of the pandemic coincided with AGM season in western economies – posing a governance risk for many companies. Regulators have mostly reacted positively, moving quickly to enable virtual meetings and remote voting. It is undoubtedly too early to assess the long-term viability of virtual shareholder participation, but, like so many changes in the time of COVID-19, what began as a business risk has developed into an operational opportunity.
Virtual – or, at least, hybrid – AGMs could become entrenched as an acceptable alternative, especially if they increase shareholder participation. Regulators’ fears that physical attendance is required to guarantee fair voting can be dismissed – though any proprietary or third -party technology used must be robust and secure enough to satisfy regulators and shareholders alike.
Governance and asset servicing, including proxy voting practices, are examples of the key operational risks assessed by Thomas Murray in its analysis of banks and market infrastructures. Clients require clear and up-to-date assessments of their counterparties’ and markets’ voting practices as part of their risk management and monitoring activities.