BOSTON (Reuters) - Symantec Corp said it plans to hold part of its 2011 annual shareholders meeting in a live setting after criticism that its online-only 2010 meeting shielded executives from tough questions.
The decision marks a victory for governance activists and investors who objected to Symantec’s September 20 shareholders’ meeting. The maker of security software, with revenues of roughly $6 billion annually, was the largest company so far to hold its annual meeting only in cyberspace.
“We’ve listened to the feedback from our stockholders and will host a hybrid meeting next year,” a Symantec spokeswoman emailed. “We remain committed to open communications with our stockholders and understand the importance for stockholders to share their concerns.”
The decision is “fantastic,” said Glyn Holton, executive director of United States Proxy Exchange, a shareholder rights group that had pressed Symantec on the meeting’s format.
“Individual investors, who have long been neglected and ignored, can have an impact,” Holton said.
The skirmish at Symantec is part of a broader battle over the rights of individual corporate shareholders.
On Monday, the U.S. Securities and Exchange Commission put on hold a new rule that would have made it easier for shareholders to nominate corporate directors, after business groups challenged the rule in court.
Electing directors is typically one of the main orders of business at shareholder meetings. But most meetings are sparsely attended by shareholders, and more companies have added online features to encourage participation.
A rule change in Delaware in 2000 also allowed some companies to turn meetings into online-only affairs, which are cheaper to stage.
Still, such events were rare until recently, when the New York proxy services firm Broadridge Financial Solutions Inc launched a service to put meetings online. So far this year more than a dozen companies, including Symantec, adopted the format.
But Symantec’s decision drew howls from investors, including California’s two large public pension funds, who worried the format would not give investors an adequate chance to grill company executives.
Faced with similar concerns from Holton’s group, chipmaker Intel Corp changed its plan and added back a “live” portion of its annual meeting earlier this year.
Symantec’s event was staged as an audio feed on the company’s website. The company drew further complaints from Newground Social Investment, a Seattle investment firm whose executives said several questions they typed into the site during the event were ignored or paraphrased beyond recognition.
Carl Hagberg, a corporate elections judge based in New York whose company has overseen several online-only meetings this year, said he wasn’t surprised by Symantec’s about-face.
“Symantec learned a lesson,” Hagberg said.
But he added that standards for large companies like Symantec and Intel may turn out to be different than for smaller companies, whose meetings often attract no outside investors at all.
Hagberg said he would be comfortable with online-only meetings at smaller companies, provided shareholders had the right to demand some sort of live event as well. Few live events would actually be called, he said, since the mundane business of the meetings often fails to thrill.
Shares in Symantec rose 1.73 percent to close at $15.28 in trading on Tuesday.
Reporting by Ross Kerber; editing by Ros Krasny, Bernard Orr
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