Anglo opts for pointless AGM format

Two weeks down, and instead of one final week we now hear that we have three weeks to go.

For some, life gets tougher by the day, others are managing to panel-beat their restricted lives into some form of routine.

Among the latter is Tiger Brands, which released what could be described, given the dystopian context, as a rather upbeat Covid-19 trading update. After acknowledging its “privileged and pivotal role in nurturing and nourishing the nation during this disaster period” and citing a remarkably long list of Covid-related challenges, it informed shareholders that it had established “a good operating rhythm in the past 10 days”.

Its focus from here on will be on ensuring the wellbeing of its people, securing key raw materials and preparing for an even more challenging operating environment. These days that is as close to good news as you’re likely to get. It’s extremely encouraging to see this sort of can-do attitude from one of our oldest and currently, extremely important, companies and is a welcome change from all the grim news that has dogged Tiger Brands in recent years.

Making the simple unnecessarily complex

Less encouraging was Anglo American’s W Heath Robinson-style approach to its upcoming annual general meeting. It has decided the one opportunity in the year that shareholders can engage with its board should be rendered almost pointless. Anglo, one of the largest and savviest companies in the world, has informed shareholders they must submit their proxies for the May 5 AGM by Friday, May 1. Any questions must also be submitted by Friday afternoon. “Responses to questions will be published on our website following the AGM,” says Anglo.

According to Anglo, in the Covid-19 era this has become standard practice for FTSE 100 companies; some are not even offering the opportunity to ask questions.

This seems unnecessarily shoddy given the options available.

Did none of the companies with primary listings in London see the JSE’s recent announcement about ‘virtual AGMs’?

In partnership with The Meeting Specialist (TMS), the JSE has launched a virtual AGM platform that allows for electronic voting and also allows participants to connect from any location in the world using smart devices. It is apparently cost-effective and “will accommodate as many participants as possible while allowing screen sharing”. The platform is designed for physical as well as electronic participation, which means it is suitable for use in a post-Covid environment.

How is it that a company that has managed to extract minerals out of the most inaccessible regions of the world can’t provide this sort of platform for its shareholders?

As one irritated Anglo shareholder pointed out: “The answer to some of my questions determine how I am going to vote on resolutions; Anglo is depriving me of the ability to follow that logic.”

Worse was to come.

Days after Anglo’s announcement Mondi told its shareholders it had a similar plan, but just a little worse.

It will only publish ‘frequently asked questions’ on its website after the AGM. Of course the issue will then be, how frequently will shareholders ask questions about the recent unexpected departure of CEO Peter Oswald, or about executive remuneration?

It’s not often the JSE can claim to offer better standards than the London Stock Exchange but with this AGM platform the local bourse is well ahead of the London exchange. Hopefully the JSE will move quickly to discourage local companies from following Anglo’s disappointing example.

Barloworld goes Zoom

Talking of executive remuneration and shareholder engagements, it seems Barloworld hosted the first ever Zoom-enabled meeting to discuss investors’ concerns about their remuneration.

The meeting, held early this month, was reasonably well attended by shareholders from across the globe, according to one of the attendees. And it wasn’t even hacked. Well done to Barloworld.

But what was it doing buying back all those shares? Some 8.7% of its shares repurchased in a transaction characterised by appallingly poor disclosure.

Buyers’ market

It’s good to see a few of our well-resourced institutional investors taking advantage of the current knock-down prices of some of our solid companies. Old Mutual has topped up its stake in construction firm Wilson Bayly Holmes-Ovcon and in food producer AVI while the Public Investment Corporation (PIC) has added a chunk of Mr Price shares to its existing holding.

On the subject of the PIC, this week one of its less successful investments, Ayo Technology, released its audited interim results for the six months to end-February 2019. The JSE insisted this controversial company’s interim figures – for both 2018 and 2019 – had to be audited if the counter was to remain listed.

The audited figures were a reminder, not that we needed one, of what a dark period this was for the PIC. In May 2019 the PIC and the Government Employees Pension Fund (GEPF) issued summons seeking to have the R4.3 billion investment declared unlawful and set aside. The PIC/GEPF wants the court to order the repayment of the money together with interest of 10.25% per annum accruing from December 2017.

This week Ayo was trading unchanged at R2.48 giving it a market valuation of R853 million, less than 20% of the PIC investment.

Great to see the SA Reserve Bank (Sarb) ‘attach’ some conditions to the relief it has provided our banks; it’s interesting how all of the big banks have responded on the request to halt dividends but none has responded to the Sarb’s request to curb executive bonuses.

On the issue of pay restraint, it was encouraging to see President Cyril Ramaphosa announce on Sunday that the top tiers of our well-paid cabinet will take a one-third pay cut for the next three months, with this portion of their salaries going to the Solidarity Fund.

When might we start to see some of those in the private sector follow suit?