Financial Times: Lively meetings: “Even big institutions are proposing to turn up to vent their anger at Shell's perceived arrogance and sorry governance”

By John Plender

Published: June 28 2004 5:00 | Last Updated: June 28 2004 5:00

People have long worried about the unsatisfactory nature of annual meetings and debated what to do about it. Yet today's Royal Dutch/Shell meetings will probably demonstrate that there is still some life in this much maligned principal-agent get-together.

Even big institutions are proposing to turn up to vent their anger at Shell's perceived arrogance and sorry governance. It suggests that the AGM is best seen as a default mechanism. When dialogue between institutional shareholders and management has broken down, the meeting can revert to its true function of providing a forum for shareholders to hold management to account.

This happened at GlaxoSmithKline over boardroom pay and it will happen now at Shell over the energy reserves fiasco. Even when nothing happens the discipline of an annual meeting keeps boards on their mettle.

At least AGMs in Europe are less unsatisfactory than in Japan, where tomorrow two thirds of all quoted companies will hold their meetings at the same time to make it harder for sokaiyagangsters to blackmail the directors. But even in Japan investors are putting more dissident resolutions aimed at enhancing shareholder value. How very un-Japanese.