Siemens to Reintroduce In-Person Shareholder Meetings After Failed Vote
Munich, Germany – Siemens AG will be required to hold its annual general meeting (AGM) in person in 2026 following a successful resistance from a significant number of shareholders. The decision comes after the company’s proposal to continue holding virtual-only shareholder meetings for the next two years was rejected by shareholders.
Shareholder Resistance
At the company’s virtual AGM this year, nearly 29% of shareholders voted against the proposal, denying the company the three-quarters majority required. This move mirrors a similar resistance by shareholders of the tourism group TUI, who successfully pushed for the reintroduction of in-person meetings earlier this week.
Siemens’ Proposal
Siemens CEO Roland Busch and his colleagues sought authorization from shareholders to continue holding virtual AGMs for two more years, citing positive experiences. They argued that virtual meetings allow domestic and international shareholders to participate without the need for travel, promoting efficiency and reducing resources.
Benefits of Virtual Meetings
Since the COVID-19 pandemic, many listed companies have adopted virtual AGMs, reducing costs and avoiding potential disruptions caused by vocal shareholders. In the past, shareholder meetings have been interrupted by angry retail investors, climate activists, and human rights groups.
Legal Framework
The German government introduced legislation during the pandemic allowing companies to hold virtual AGMs. While some companies see advantages for international investors, shareholder representatives express concerns about potential limitations on their rights.
Importance of AGMs
AGMs are a crucial decision-making body for shareholders, alongside the executive board and supervisory board. They provide an opportunity for shareholders to hold company leaders accountable, approve dividend distributions, and vote on board appointments.
Siemens’ Motivation
Siemens’ push for virtual AGMs stems from the high cost of in-person events and the potential for disruptions that can hinder smooth proceedings. However, shareholders have demonstrated their desire for face-to-face interactions, limiting the company’s ability to solely rely on virtual meetings in the future.
Outlook
The decision by Siemens to reintroduce in-person AGMs highlights the growing demand from shareholders for direct engagement with company executives. While virtual meetings offer convenience and accessibility, they may not fully replace the value of face-to-face interactions and the ability to hold management accountable.
As companies adapt to the post-pandemic landscape, they will need to carefully balance the benefits of virtual AGMs with the importance of in-person meetings to ensure effective shareholder engagement and transparency.
