High Rollers: Informa Executives Jet Off to the Riviera, Leaving a Grand Thousand Pound Tab for Investors to Join
Revamped Write-up:
Informa, the London-listed publishing juggernaut, skips the traditional in-person annual meeting this week and heads to the sun-soaked French Riviera for a digitally-focused event. This move follows others in the corporate realm aiming to streamline shareholder gatherings in the digital era.
For UK-based shareholders, the virtual approach is their only option due to logistical hurdles associated with traveling to thefive-star Maison Albar resort in the heart of Nice, where the meeting takes place. With airfare and accommodations totaling close to £1,000, few shareholders find the venture financially feasible.
The relocation can be seen as a cost-cutting measure on Informa's part, as many other companies have transitioned their AGMs to a digital-only format, citing convenience, efficiency, and modernization.
Yet, critics argue that corporations are using virtual meetings to stifle debate, discussion, and dissent, dealing a blow to shareholder democracy.
Catherine Howarth, head of the shareholder lobby group ShareAction, characterizes Informa's decision as an example of "disappearing directors" and calls for government intervention to prevent this incident from becoming a pattern.
Another shareholder has termed the move 'incredible,' while another, who attended last year's in-person London event, expresses surprise, noting its crowd and quality.
Informa has been grappling with shareholder discontent over executive compensation. Since becoming CEO in 2013, Stephen Carter has earned nearly £40 million. For 2023, he stands to pocket £7.2 million – an increase of approximately 20% compared to his 2024 paycheck.
Carter, former chief adviser to Gordon Brown during his tenure as Prime Minister, has overseen Informa's rapid expansion, transforming the company into the world's largest business events group. Its stock market value now exceeds £10 billion, and it also boasts the academic publisher Taylor & Francis as part of its portfolio.
Last year, Informa purchased France's Ascential in a £1.2 billion deal that brought prestigious advertising extravaganza Cannes Lions under its umbrella. Chairman John Rishton confirms that the meeting is being held in nearby Nice so the board can attend the festival, which overlaps with it. He extends an invitation to shareholders to join virtually, given the considerable expenses involved with attending in person.
The legislative landscape regarding annual meetings is unclear, as the regulations were drafted two decades ago, long before the advent of widespread virtual events. Measurements concerning the meeting's physical location, the necessity of the board's presence, and investors' access are not explicitly defined. Ministers are currently consulting on these issues.
Companies contend that face-to-face meetings are expensive and prone to disruptions, as seen with the incident at Drax when environmental activists disrupted the meeting. Some companies have resumed hybrid meetings in response to shareholder pressure. For instance, Marks & Spencer has faced scrutiny for attempting to make their meetings solely digital, earning reproach for being "arrogant" and setting a "poor precedent."
Despite the convenience and cost savings of virtual meetings, concerns center on reduced engagement among shareholders, obstructed transparency, and accountability. Some fear that digital platforms might limit spontaneity and provide less accessible interaction, which could disadvantage smaller investors. farther less tech-savvy shareholders. This tension highlights the challenge of balancing digital advancements with the need for transparent shareholder democracy.
[1] C. Eckert, M. Mitchell, and M. M. Yeoh, "The transformative power of digitalization for the public sector: A review and future research directions," Information Technology & People, vol. 33, no. 6, pp. 981-1000, 2020.
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- Informa slashes £1bn profit target as events firm suffers FX hit Bloomsbury shares dive after Harry Potter publisher faces tough trading conditions
- Shareholders are facing financial challenges in attending the digitally-focused Informa meeting, with high costs associated with travel, as evidenced by airfare and accommodations totaling close to £1,000.
- Despite the convenience and cost savings of virtual meetings, critics argue that corporate entities, like Informa, are using such platforms to stifle debate, discussion, and dissent, potentially damaging the essence of shareholder democracy.
