What companies gained, lost by going virtual in 2020The Atlanta directors at Delta Air Lines' 2017 annual meeting - Chairman Frank Blake; Coca-Cola's Kathy Waller and CEO Ed Bastian (Photo by Maria Saporta)
By Maria Saporta
For corporate America, 2020 was the year of virtual annual meetings.
In the past three months – annual meeting season – nearly all of Atlanta’s major companies decided to go virtual rather than convene their shareholders in person.
So how did they go?
In almost every case, something was gained, and something was lost.
For most companies – Cousins, Coca-Cola, Genuine Parts, Truist (formerly SunTrust), Veritiv, Pulte Homes, Equifax, Primerica, Norfolk-Southern, Invesco, Intercontinental Exchange, Home Depot and Delta – this was the first time their annual meetings were not held in person.
Frank Martire, NCR’s executive chairman, said that holding a virtual annual meeting reduced costs while “still allowing stockholders to participate and ask questions.” Not one shareholder asked a question.
In decades of going to annual meetings, it’s become readily apparent that companies exhibit their true culture in the way they interact with shareholders and the general public.
The companies that excel in holding annual meetings tend to be our best-known brands – Home Depot, Coca-Cola Co., the Southern Co.
Those companies have always welcomed maximum interaction between their executives and the people who own shares in their company. Their companies’ characters did not change as a result of going virtual.
Coca-Cola CEO James Quincey said the virtual annual meeting was an example of how the company had to adapt during the COVID-19 pandemic, and he was reminded of all the difficult chapters the company has faced in its 135-year history.
Still, one could tell Quincey missed the physical gathering at the World of Coke, where the company has held its annual meeting over the last several years.
“It’s very human to want to congregate, to do things together,” Quincey said. “There will be new behaviors. At the end of the day, while there are many unknowns, there are a few knowns. It’s a very dynamic situation.”
As is Coca-Cola’s practice, Quincey took nearly a dozen (mostly tough) questions from shareholders.
Home Depot, one of the most open companies when it comes to annual meetings, fielded about 16 questions from shareholders.
“We miss seeing you in person,” Home Depot CEO Craig Menear told shareholders. “We plan to return to a physical, in-person meeting next year.”
Southern Co. CEO Tom Fanning echoed that sentiment.
“If circumstances permit, we hope to return to our in-person meeting next year,” Fanning said, adding the company was trying to achieve “the same transparency that our shareholders would experience in an in-person format” in the virtual version. He took about 15 questions from shareholders, including several from the company’s most vocal critics.
On the other extreme are the companies that boast that their annual meetings last less than 10 minutes and that no one asks questions. Those executives rarely share with shareholders what’s going on with their companies or appear interested in hearing what’s on the minds of their shareholders.
Several companies seemed to be weighing whether they would ever hold their annual meetings in person again.
“We will be assessing the format this year to see if we will be using it for future meetings,” said Bryce Blair, the non-executive chairman of PulteGroup.
Jim Squires, CEO of one of Atlanta’s newest Fortune 500 companies – Norfolk-Southern, was asked if future annual meetings would be virtual.
“We will consider the result of this meeting and the shareholder impact,” said Squires, who mentioned the cost savings. “We will determine how it has gone before we decide what we will do in the future.”
Intercontinental Exchange, however, embraced the idea of a hybrid model.
“Past meetings have been in person and have been webcast, and we like that,” said Jeff Sprecher, CEO of ICE. “There’s a difference between socializing in person and socializing on video. Personally, I hope we will be back in person next year.”
When it comes to major Atlanta companies, there are a couple of anomalies.
UPS has been holding its annual meeting in Wilmington, Del. – not exactly a spot that’s convenient for Atlanta shareholders and employees.
And Delta Air Lines traditionally has held its annual meeting in New York City, where few shareholders and employees regularly attend or ask questions.
So, for Delta, the 2020 virtual annual meeting gave CEO Ed Bastian a real opportunity to connect with shareholders in a new way. Bastian answered more than 14 questions from shareholders, and he was able to share the challenges that Delta, our city and our society are facing.
“The level of angst in our society weighs heavy on our hearts. We are in a very difficult period of time with the pandemic and racial inequality,” said Bastian, who spoke of the need for leadership. “You should hold me accountable to that.
Delta, one way to become more accountable to shareholders and your associates would be to hold your annual meeting at the Delta Flight Museum and celebrate being transparent to your core constituencies.
Southern Co.’s Fanning probably said it best.
“I really miss person-to-person contact. It’s really a celebration,” Fanning said of the company’s traditional annual meetings at Callaway Gardens. “I always want to show my appreciation to you face-to-face, to be transparent and to be accountable to you – whether the news is good or bad.”
That’s corporate democracy in action.