Whilst being a good company in most respects, it is a shame that Supermarket REIT (SUPR) has blotted its copybook with an undemocratic general meeting.
A general meeting was held today (5th October), to approve the issue of shares in order to expand the REIT. The notice of meeting says:
However, you are reminded that in light of social distancing measures imposed by the UK government as a result of the current COVID-19 Pandemic, any member seeking to attend the meeting in person will be refused entry to the meeting.
The meeting was held with just representatives of the REIT present. Yet, announcing the results of the meeting today, the company says:
Supermarket Income REIT plc, announces that at the Company’s General Meeting held today, all resolutions were passed by a show of hands and the results of the proxy votes received are set out below.
Clearly, with shareholders not being present, a show of hands vote is meaningless and undemocratic. By adopting such a practice (rather than conducting the vote on a poll), directors could arrange for almost any resolution they liked to be passed. In this case, there was no issue, as proxy votes were overwhelmingly in favour of the proposed resolutions (I hold shares and voted in favour myself).
SUPR is not the only company to commit this sin, but I feel compelled to call it out.
IMO, the government must revise current legislation that permits closed meetings during the Covid-19 pandemic such that voting must be by means of a poll if a company opts to hold a closed meeting.
Shareholders need to be aware of this potential trap, and in the case of controversial resolutions, should demand a poll ahead of a meeting. All it needs is 5 registered shareholders to demand a poll for that demand to be effective.
Mark Bentley, Director, ShareSoc