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  • Doug Chia

Virtual Shareholder Meeting as a Safety Measure?

When it comes to why a public company opts to have a virtual-only shareholder meeting instead of an in-person one, the reasons typically given can be called the “Four Cs”: Cost, Convenience, Carbon, COVID. To use those words in a full sentence, a virtual-only annual meeting is a cost-effective way to provide access to the company’s annual meeting through a convenient platform for shareholders that helps reduce carbon emissions and minimizes people’s exposure to COVID-19 and its variants. Despite some shareholders’ concerns about VSMs making it more difficult or impossible for shareholders to engage with the board, management and other shareholders in the way they’d like to, there are actually many shareholders who don’t mind or even prefer the virtual format.


In the pre-COVID days, I heard some service providers pitch VSMs as a way to guarantee safety and security for board members and executives. I wasn’t really sold on this. Fast forward to 2023, and the selling point just got stronger.


Last week at the Walgreens Boots Alliance annual meeting held at The Resort at Pelican Hill near Newport Beach, California, anti-abortion protesters “broke into the room” (in the words of Reuters) to protest the company’s decision to start selling mifepristone, a prescription pill approved by the FDA for medical termination of a pregnancy through ten weeks gestation. The FDA recently allowed retail pharmacies to dispense mifepristone in states where abortion is legal. Previously, patients could only obtain mifepristone in person at clinics, hospitals and other certified health-care providers, but not at retail pharmacies like Walgreens.


Here is what Walgreens Senior Director for External Relations Fraser Engerman told Reuters after the incident:


Today, directly after the close of official business of our annual shareholders meeting, a small group of protesters entered the meeting room without authorization.


We are grateful that none of our shareholders, team members and event staff were harmed during this incident.


We believe strongly in the right to peaceful protest, and an area was set aside for this purpose, but unfortunately some protesters took further disruptive actions.


Protests at annual meetings are nothing new. There are a few every year organized by groups with various causes and motives. But what these people did at Walgreens last week took things to another level. Even veteran shareholder proponent, John Chevedden, characterized last week’s Walgreens annual meeting as a “wild” one. Chevedden told Reuters, “The protesters knew what they were doing because they found a way to enter the room from behind the podium. It was a complete surprise." The thought of protestors sneaking out from behind the podium is pretty scary stuff for people who are responsible for these meetings (like I once was) and the board members who sit in the front row.

When you hear how the perpetrators themselves describe it, it’s even scarier. In posts on Twitter, they brag that they “hid in the closet where the Walgreens stockholder meeting was being held, 9 hours prior to it starting, in order to crash the meeting and let them know blood will be on their hands.” That is crazy.


This brazen stunt has been attributed to the groups Live Action, which claims to have the “largest and most engaged online following in the pro-life movement,” and Survivors of the Abortion Holocaust, which describes itself as a “youth based pro-life activism and apologetics ministry that exists to empower and equip the rising generation to end the abortion genocide in America.”


I have my own experience with annual meeting protestors—anti-abortion, animal rights, and patient advocacy groups, local labor unions and others. The ones I dealt with were what I refer to as “professional protestors” who understand and abide by the rules. They obtain permits in advance from local authorities to hold their protests on public property, and for the most part they stick to the area that is allocated to them, usually the sidewalk outside the building where the meeting is being held. And they keep it peaceful (physically, but not always verbally). You’ll see them holding signs, handing out flyers, shouting through bullhorns, and occasionally wearing pig costumes and pumping up inflatable rats. Pretty garden-variety protest stuff. There are also actual shareholders with the same causes who express themselves inside the meeting room by filing shareholder proposals and getting time to introduce them or waiting to speak during the Q&A sessions.


According to LifeNews.com, an “independent news agency devoted to reporting news that affects the pro-life community,” while the mainstream news media “primarily focused on a small group of protesters who entered the shareholders meeting uninvited… most [of the protestors] stayed outside and the protest was peaceful.” Chevedden told Reuters that he saw “about 50 noisy protesters with signs just outside of the resort grounds” as he was leaving.


At a roundtable discussion I organized back in the day when fewer than 200 companies had VSMs (compared to over 2,000 in both 2021 and 2022), I heard an executive officer of one of the service providers say that VSMs should be looked at as a way to protect people’s safety. When I raised an eyebrow of skepticism, his response was “You never know. It’s a crazy world out there.” Now he may have been proven right.


A reporter for the women’s news and culture website Jezebel summed it up well, saying these protestors “camped out in a closet for nearly half a day to berate [Walgreens] for selling FDA-approved medication.” If these anti-abortion people were able to pull this off, think of what other would-be annual meeting crashers who come armed and with malicious intent could do after popping out from a closet backstage.


What happened at Walgreens last week will likely make some companies (particularly their corporate security departments) think hard before moving back to in-person annual meetings. One company I’m thinking/worrying about is CVS Health. The same groups that are targeting Walgreens are also targeting CVS over the abortion pill issue through a well-coordinated, cross-country campaign. Prior to 2020, CVS held its annual meeting in May in Rhode Island, where the company is headquartered. I’m eager to see what the notice for this year’s annual meeting says when it’s filed, likely in early April.


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