Andrew Freedman Quoted in Barron’s on Tactics Companies Use to Silence Shareholders at Annual Meetings

Olshan Co-Managing Partner and Chair of the firm’s Shareholder Activism Practice Andrew Freedman was quoted in a Barron’s article (subscription required) on the tactics that companies are using against shareholders to limit what they can say at annual meetings. A key tactic companies have used is holding online-only annual meetings. Investors who want to speak are told they must read proposals verbatim, a departure from standard practice, and if they go off-script, they are warned they’ll be muted. In some cases, companies are taking questions submitted online and summarizing them in ways investors believe distort their meanings or are not answering them at all. Such virtual meetings often run counter to corporate-governance practices that say virtual settings should aim to recreate in-person meetings as best they can. “Companies are continuing to use virtual meetings,” Andy commented, “even though the need for them has been alleviated, because it’s much less transparent and personal.” Hybrid meetings—a mix of virtual plus in-person components—offer a better format for investors, he added. Data from this proxy season showed that 94% of virtual meetings allowed shareholders to submit questions in real time, but how management teams handle those questions varies in terms of how many questions companies answer, if the questions are read verbatim and how much time shareholders are given to submit questions in real time.