How Shifting from In-Person to Virtual Shareholder Meetings Affects Shareholders’ Voice, Miriam Schwartz-Ziv‘s new paper recently posted on SSRN will be the subject of a virtual seminar held on Wednesday, Sept 2nd, from 11 AM-noon EDT. See the link below.
Miriam Schwartz-Ziv will present her paper in about 30 minutes during an online seminar on Wednesday, Sept 2nd, from 11 AM-noon EDT. Commentators will then present brief questions and/or critical comments.
- Prof. Alon Brav (Duke),
- John Chevedden (Shareholder advocate),
- Doug Chia (Soundboard Governance and Fellow at Rutgers Center for Corporate Law and Governance),
- Sanford Lewis (Strategic Counsel on Corporate Accountability),
- Jackie Cook (Morningstar),
- Prof. Jonathan Kalodimos (Oregon State University),
- Prof. Nadya Malenko (University of Michigan) and
- James McRitchie (CorpGov.net).
Audience questions are also welcome.
The zoom link for the seminar is: is: https://huji.zoom.us/j/99259748702?pwd=ZXZ0ZlRYVGpoQ3RmcG1ZQnBCZlJSUT09
Meeting ID: 992 5974 8702, Passcode: 613475
If you encounter any technical issues joining the seminar please email Ori Haimovich: Ori.firstname.lastname@example.org.
The most updated information on the virtual seminar will be posted here. Please invite anyone who may be interested in participating.
Virtual Shareholder Meetings: Study Finds Negative Impacts
The paper documents that communication at virtual meetings has decreased relative to in-person shareholder meetings. Then, Schwartz-Ziv discusses the challenges shareholders encounter at virtual meetings when they attempt to raise questions. Highlights of the study are also reported on the Harvard Law School Blog, as well as in the WSJ, and NYT.
Shareholder meetings are one of the only opportunities for most investors to interact directly with management. Due to Covid-19, however, shareholder meetings have moved to a virtual format. Analysis of transcripts and recordings of in-person and virtual shareholder meetings in 2019–2020 shows that, relative to in-person meetings, the overall time of virtual meetings is 18% shorter, and 29% less time is spent by firms on answering each question. These findings indicate that communication between companies and shareholders is more limited at virtual meetings.
To examine if shareholders face challenges in their attempts to increase such communication in virtual meetings, I construct a dataset on shareholders’ attempts to submit questions to virtual shareholder meetings and document several tactics firms use to avoid addressing them. For example, firms explicitly state that no (additional) questions were submitted, whereas I document that multiple questions were submitted by shareholders, but were ignored.
Finally, a mechanism that imposes severe restrictions on shareholders’ ability to submit questions at virtual shareholder meetings is uncovered: the use of a non-Broadridge platform to broadcast the meeting. Overall, the paper documents that with regard to 55% of the firms to which shareholders attempted to submit questions, shareholders faced obstacles. The paper concludes with policy recommendations on how virtual shareholder meetings can be designed in ways that foster communication between management and companies.