Bunching up of AGMs in April getting worse, says report

[donmihaihai]

So during the AGM itself which was virtual only, There was a point when the chairman invited the agm participants to ask questions by typing in. I frantically copy and paste all my ten questions in within the short time window. In the end some of my questions were answered, proving they were valid. This year AGM, I really feel like banging table and asking who is the guy manning the IR email. I think its the CFO.

If one approaches it with guns blazing, I am certain the interaction won't be meaningful. be it physical, virtual or written Q&A. 

In virtual AGM, it is easy to overlook questions one doesn't wish to reply to. 

In written Q&A, company has a substantial and relevant shield which is can be quite effective. However, if shareholders have done enough homework, including how the management engaged with shareholder previously, and craft questions with the potential to elicit meaningful engagement from the management, then the public will be able to gain through the replies. Some useless questions will be like, more dividend, future number look like. On this note, I have the experience of the company editing my questions and turning them into a PR spin with their responses. 

In Singapore, I my opinion of IDs is low, not due to their professional qualifications or personal achievements, but because they seem to perform a delicate balancing act with an eye on the fee. ID will be on the same side as ED and won't turn until there is no other way. Each has their own bottom line. 

Written as someone who alternates between submitting questions and drafting responses, facilitating AGMs and seeing IDs at work.

[dreamybear]

I think this recent SIAS webinar is timely in this period of attending AGMs.

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Investor Forum - Key Insights for Investors: Understanding the Functions of Boards and Subcommittee
https://www.youtube.com/watch?v=FvYdMrLQGio
"Annually, the engagement between Shareholders and Board of Directors (Board) usually takes place only once a year at the company’s AGM. Most of the Shareholders have the understanding on the key roles of Boards and Subcommittees, but, not in details. The Board, as the governing body of a company sets the strategic direction, ensures financial health, and upholds the company's mission and vision. The subcommittees, composed of board members with specific expertise, focus on distinct areas of the company's operations and they also provide a platform for non-board members with specific skills or knowledge to contribute to the company's governance.

In this webinar, investors can learn how Boards and Subcommittees function. Investors can also gain an understanding of assessing Board’s effectiveness, the potential risks involved, and the overall governance of the company. The knowledge is important in evaluating the company’s prospects and stability."

[weijian]

In Singapore, I my opinion of IDs is low, not due to their professional qualifications or personal achievements, but because they seem to perform a delicate balancing act with an eye on the fee. ID will be on the same side as ED and won't turn until there is no other way. Each has their own bottom line. 

Written as someone who alternates between submitting questions and drafting responses, facilitating AGMs and seeing IDs at work.

hi donmihaihai,

Mind you, the market for IDs is fierce and highly competitive, especially for "high quality directors". At least, the ones at Fu Yu Corp believes so:

Directors play an important role, especially amid the transformation that the Company is going through. Our decision to maintain director fees at their current levels will ensure we attract and retain high-quality directors.

Fu Yu AGM Q&A:
https://links.sgx.com/FileOpen/Fu%20Yu%2...eID=797312

Fees aside. After some period of observation, I finally start to understand where can one find "high quality" directors, especially for IDs:

(1) With the 9year limit been enforced, we are seeing many long serving IDs who previously survived with the 2 tier voting mechanism, retiring this year. Pretty sure high quality ones will be retained on a precious "non independent" director quota and continue to have his/her talent well regarded by the Company.

(2) When business dynamics evolved to threaten your survival, the decision makers will surely be incentivized to make changes to put in "high quality" directors. Ditto what is happening at the Jardines.

[CY09]

Im more inclined to Donmihaihai response. For the Fu Yu's reply, 233k in director's fee isnt that high when compared to other companies ID fees.

I personally feel IDs should follow the same concept of a proposal for auditors where they are hired from a general pool and not hired directly by the company. Both IDs and auditors should come from accredited pool. Singapore's standard for auditing and the IDs is terribly poor. During AGM of smaller companies when talking to IDs, I can sense they are just there for the money via the multiple positions they take with very little knowledge of the companies they are in.

I have attended AGMs across multiple indsutries like FSL Trust, Ezion etc. No IDs have given good impressions. This has to change but in Singapore where money talks with the unique situation of a stock exchange company holding the regulatory role as well; I am quite sure nothing is going to change. The power is tilted unfavourably to companies

[donmihaihai]

In Singapore, I my opinion of IDs is low, not due to their professional qualifications or personal achievements, but because they seem to perform a delicate balancing act with an eye on the fee. ID will be on the same side as ED and won't turn until there is no other way. Each has their own bottom line. 

Written as someone who alternates between submitting questions and drafting responses, facilitating AGMs and seeing IDs at work.

hi donmihaihai,

Mind you, the market for IDs is fierce and highly competitive, especially for "high quality directors". At least, the ones at Fu Yu Corp believes so:

Directors play an important role, especially amid the transformation that the Company is going through. Our decision to maintain director fees at their current levels will ensure we attract and retain high-quality directors.

Fu Yu AGM Q&A:
https://links.sgx.com/FileOpen/Fu%20Yu%2...eID=797312

Fees aside. After some period of observation, I finally start to understand where can one find "high quality" directors, especially for IDs:

(1) With the 9year limit been enforced, we are seeing many long serving IDs who previously survived with the 2 tier voting mechanism, retiring this year. Pretty sure high quality ones will be retained on a precious "non independent" director quota and continue to have his/her talent well regarded by the Company.

(2) When business dynamics evolved to threaten your survival, the decision makers will surely be incentivized to make changes to put in "high quality" directors. Ditto what is happening at the Jardines.

How do you want the company to answer when it is being questioned on why the director fee remain high? Of course I would put the spotlight on their important contribution. Let be honest, nobody really knows, especially the public.  

Of course, there are quality IDs. But beside IDs own quality, the stage must be set for IDs to dance. The stage is set by EDs. While IDs are elected by shareholders, it is the EDs that brought IDs to the table for shareholder to vote. IDs know who get their names to the table. 

Do you think an ED will put someone that will question on how he run the company or his remuneration? I have seen an ID that last only a short while. never attended a board meeting. go figure.

[specuvestor]

Agree with- Donmihaihai. The incentive structure is already symptomatic of toothless IDs

That's why I'm of the opinion that MAS / SGX should be the one remunerating a pool of auditors / IDs with companies contributing to the pool base on their taxable income

[donmihaihai]

Agree with- Donmihaihai. The incentive structure is already symptomatic of toothless IDs

That's why I'm of the opinion that MAS / SGX should be the one remunerating a pool of auditors / IDs with companies contributing to the pool base on their taxable income

I have no opinion on auditor. 

But I can imagine such an arrangement would lead to EDs and IDs gearing up with lots of amours during board meetings as they face each other, and the mood will be tense. This wouldn't be helpful for a company if the board of directors is dysfunctional.

[specuvestor]

yes agree. But that's the purpose of an independent check and I do not think 1 or 2 ID is going to run the board.

But I do agree an overly zealous ID might not be helpful for the company so I guess their role should be defined to be on Corporate Governance, conflict of interest, remuneration etc rather than business plans, strategy etc as they might not be well industry expert and smart alecs will do more harm