Meetings are an importation part of running an organization or a large project. At meetings, issues are addressed, important decisions made, and plans created for the future. In public companies, annual meetings are held for the benefit of the owners in the company called Annual Shareholder Meetings.
- Annual Shareholder Meetings are a required assembly for owners wanting to get involved with the running of the company.
What happens at annual shareholder meetings? Owners are presented with business strategies for the future, and reports showing the company’s performance to date. Owners with the right to vote also decided on who should run the company and how it should be run. Examples for issues voted on at annual meetings include:
- New members of the board: who will run the company in the following year.
- How executives are compensated: by salary or more often stock and benefits.
- Paying of dividends: how much, and when.
- Appointment of auditors: Who checks the company’s financials.
Shareholders unable to attend the meetings can vote by proxy. Owners can proxy vote through the mail or online. A broker is another way owners can proxy vote. Brokers will vote for a shareholder if they do not give the broker any instructions 10 days prior to a meeting, or if the broker is given permission to vote on behalf of the shareholder.
| Topic | Annual Shareholder Meetings |
| Purpose | Addressing issues, making important decisions, and future planning |
| Attendees | Owners/shareholders of the company |
| Key Matters | Election of board members, executive compensation, dividends, auditors |
| Voting Options | In-person or proxy voting (by mail, online, or through a broker) |
| Legal Requirements | Compliance with state and federal meeting regulations |
| Frequency | As required by applicable laws |
| Importance | Owners have input in company functioning and learn about its status |
| CEO’s Role | Opportunity for CEOs to present company’s performance and vision |
| Celebrity CEOs | Celebrity CEOs can impact the company’s image and reputation |
| Shareholder Participation | Optional, but shareholders can ask questions and propose policies |
| Excitement Level | Shareholder meetings can be engaging and eventful |
Public and private companies must follow state and federal laws regulating how to run a meeting for owners, and when and how often they must be held. These laws vary by state and region, but in general public companies must give shareholders advanced notification of a shareholder meeting, and provided a proxy statement of the meetings itinerary. Companies, generally, must also provide financial statements and elected board members for the following year. Of course, if an issue arises that requires immediate attention the board can call a shareholder meeting to address it.
Annual shareholder meetings are an important part of running a business. It is a time for owners to give their input into how they want the company to function. It also gives the CEO and other company executives an opportunity to explain why the company is where it is, and share their vision of where the business can go in the future. Many people outside the business world are familiar with the CEOs of companies like Tesla’s Elon Musk or Facebook’s Mark Zuckerberg. Celebrity CEOs can give performances at shareholder meetings that boost a company’s image with its owners and the world at large; or equally, lead to bankruptcy.
Shareholders, including owners with voting rights, are not required to attend or vote in any of these meetings. However, shareholder have the ability to learn more about the company and how it is run. They can directly ask executives questions, and even present their own policies for vote. Good or bad, Shareholder meetings can be exciting events.
Check shareholder services at Colonial Stock’s website, or contact us to learn more.