Shareholders under the auspices of Pragmatic Shareholders Association of Nigeria have condemned the recent directive by the Securities and Exchange Commission to create a sub rule to regulate the conduct of Annual General Meetings.
In a sideline interview with The Point, the National Coordinator of the group, Mrs Bisi Bakare, said her members were totally against the proposal which would never work.
Bakare said, “While we acknowledge that there are abuses by shareholders, we cannot cut the nose to spite the face or throw away a baby with the bath water. The gift at AGM is a smile to an annual birthday which the companies mark in appreciation of another successful business year.”
According to her, “apart from the statutory requirements to approve the accounts and all others, it is a celebration between the company and its shareholders. The abuses will definitely be checked, not that the shareholders should be denied their delights”
She explained that such rules and proposal from SEC showed that SEC had lost focus in the capital market. “What is the cost of the gifts being distributed at AGM to Shareholders whom are owners of the companies with CSR and Donations recorded by companies each year?
She said, “If owners of the business cannot benefit from the hard earned money they invested, who else should do so. The issue of rowdiness is caused by the inefficient stock brokers that honour Shareholders that gave names to their friends and colleagues to attend AGM. Secondly, The Nigerian stock exchange needs to look into issues of minimum units to buy through secondary market.
“For instance, when we are applying for public offer, there’s a minimum unit required. Why not do same in the issue of secondary market. All these so called shareholders that are causing problems and nuisance at AGM are those that have 10units, 20units, 30units 40units, 50units even 100units of shares. There should be minimum requirement units from secondary market too to eradicate this rubbish at AGMs.”
She, however, called upon The Nigerian Stock Exchange to look into this issue critically in order to bring back sanity into the system.
“On pre-AGM meetings, this is also part of shareholders’ rights, which should not be denied them. How many hours do we spent on the floor of AGM. But Pre AGMs give enough opportunities to ask cogent questions and advice that will enable companies to move forward,” Bakare added.
Commenting, the National Chairman, Progressive Shareholders Association of Nigeria, Mr. Boniface Okezie, said SEC’s decision in a way was commendable.
“Many quoted companies in Nigeria now have foreigners on the board. It will be so embarrassing to see Shareholders scrambling for gift items at AGMs. Although, not every shareholder does that. But it would have been proper for companies to devise another means of giving out gifts in an orderly manner,” he said.
Okezie noted that the capital market regulator had no right to regulate how companies conduct their AGM.