Small investors who may want to voice their ideas to the directors of big tech companies seem to be losing their only chance. It has been noted that many board members’ are failing to attend the yearly shareholder meetings. Interestingly, companies’ with a tendency of holding online meetings have the worst attendance records.
In the recent years, a large number of the directors of Facebook Inc, Alphabet Inc, Twitter Inc and Netflix Inc have skipped the shareholder meetings held annually as shown by company records and securities filings. The companies have refused to disclose the details of their absence. Retail investors use such meetings to pose questions to the directors.
Big asset managers can easily reach the big tech companies directors but the empty seats at the annual meetings indicate that small investors may never have an opportunity to engage with the boards. Chief investment officer of NorthStar Asset Management, Christine Jantz says that, even when the directors hear some concerns, they fail to respond to them.
Jantz adds that Facebook may have dealt with the data privacy issue better if its board was keen on issues of content oversight and governance that were discussed in the latest annual meetings. According to the company’s proxy filings, only four out of the total eight directors attended Facebook’s annual meeting in 2017. This year, only five directors attended and Thiel was absent.
Other companies touched by the absenteeism issue include Alphabet which is the parent of Google. Unlike Facebook, Alphabet has lowered its numbers with only four out of the eleven directors attending its annual meeting this year. The event transcript indicates that the CEO page was absent. Last year’s annual meeting also saw four directors in attendance thus hitting an average of five directors since 2006.
It is highly recommended by the National Association of Corporate Directors to attend annual meetings. Based on the latest proxies of the twenty largest companies in the S & P 500 index, top businesses in the US attend their yearly meetings with the exception of Facebook and Alphabet. Thus, tech leaders such as Apple and Amazon registered good attendance not forgetting JPMorgan Chase & Co and Exxon Mobil Corp.
However, some tech firms have opted for cyber space where the absence of the directors is less noticeable. For instance, according to the company WebPage, only two out of 11 Netflix directors attended the online meeting on June 6. John Chevedden, an activist investor says that the online way of conducting meetings provides an excellent opportunity for directors to skip meetings.