Agms are so boring it is a wonder anyone bothers to attend at all

LAST WEDNESDAY, Ocado, the online grocer, held its first agm. How many shareholders do you think turned up? Just one: a solitary woman.

The previous week, I had been at the agm of the company where I’m a non-executive director. It was more or less the same story.

There we all were, 11 directors, in our best clothes with ties straight and hair combed, ready to answer tricky questions.

The teas and coffees were laid out, with a choice of biscuits and still and sparking water. But the neat rows of chairs facing us were almost entirely empty.

This surreal experience left me feeling a bit like Charlie Chaplin in The Gold Rush, when he invites his love to dinner and prepares the meal and waits but she does not come.

It is pathetic to sit on a raised platform ready to give a performance and find that no one wants to hear it.

Compare this to the first agm I went to as a journalist. The year was 1987 and British Gas had just been floated on the stock exchange. More than 3,000 investors turned up (a figure that at the time was seen as low) and throughout the three-hour meeting a woman in evening dress reproduced the chairman’s words in sign language in case any of the mainly elderly audience was having difficulty hearing.

A quarter of a century later, so many companies are holding agms in almost empty rooms, they have started to wonder whether the exercise has any point at all.

They complain that the meetings are farcical – a waste of money, time and effort, what with all that prepping of directors on the answers to tough questions that no one turns up to ask.

It is easy enough to understand why hardly anyone can be bothered to attend. Agms are a shocking bore, and society’s tolerance for voluntary boredom is falling.

If you think of them as theatre, they make Waiting for Godotseem action-packed. "Those in favour of reappointing Ernst Young as auditor . . . Votes in favour? . . . And votes against."

This was always dull, but is now pointless too, as the votes have all been cast by proxy ahead of time.

The more difficult thing to grasp is why anyone turns up at all. I’ve pondered this and come up with four reasons.

The first is because they are genuinely interested. There used to be a backbone of earnest, mainly retired investors who always attended agms, but as a group they are in retreat.

Partly because small shareholders can find out what they need online but also because the sort of eccentric shareholder who in 1997 got up at a meeting of Hambro bank and in Latin asked the finance director to click his heels is a dying breed.

Oldies today are not what they used to be.

The second reason is food. This has been the secret of Marks and Spencer’s enduringly popular agms.

The 1,800 who queued for last year’s meeting at the Royal Albert Hall were given free ice-cream as they waited, with more goodies on offer inside. To work as an inducement, the food must be good: a mere dry biscuit is no longer sufficient to get a single bottom on to a single seat.

The third is entertainment, though there has been a sad falling off here, too.

Chairmen are duller than they once were and combative figures such as Tiny Rowland – who always gave good value to Lonrho’s shareholders – have been replaced by well-behaved men reading from prepared scripts. Only Warren Buffett is worth seeing for his own sake, but he is almost in the past now, too.

Failing a charismatic chairman, the best option is to get a celebrity along. MS got Twiggy up on the stage last year, which pleased the crowd no end.

This leaves the only serious reason for turning up to an agm – to complain.

Particularly in an internet age, it is vital for everyone who owns a piece of the company to have one chance a year to look the directors in the eye and challenge them on anything at all – on pay, on performance, or even (as at MS) on why there were no size 20 camisoles in the Camden Town branch.

If this is the true purpose of the agm, and the reason they deserve to endure, it throws a different light on scant attendance.

If no one turns up, it doesn’t mean that the company is unloved and the whole exercise is pointless. It means that it is not paying its directors too much, or polluting too many rivers.

In which case, the directors need not feel like Charlie Chaplin. They deserve instead to crack open the sparkling water and lay into the mounds of untouched biscuits themselves. – (Copyright The Financial Times Limited 2011)