The board of Mr Price appears to have come up with the ideal solution to the horrors posed by annual general meetings for senior executives of listed companies terrified of unscripted meetings: shrink the session to a bland four-minute affair.
Here’s how they (almost) did it.
Pre-AGM meetings are held with most of their shareholders at which anything sensitive can be discussed behind closed doors. In addition, shareholders are ‘encouraged’ to cast their vote ahead of the meeting. Of course, any AGM-tracker will know there’s nothing new in those moves.
Where Mr Price has moved to a whole new level was in skipping the tedious reading out of each of the resolutions, and instead lumping them all together in one brief but sweeping proposal which was promptly adopted.
This shaves a good 20 to 30 minutes off the meeting. It ensures the AGM is kept tight and minimizes the potential for unscripted interventions by shareholders.
After the sweeping multi-resolution proposal was adopted board chairman Nigel Payne paused a few seconds, before informing the meeting that “all the shareholders have already passed the votes”. He was just waiting for Computershare to do a final tally.
That’s three-and-a-half minutes and you’re done.
At least that’s how Mr Price’s AGM would have played out had it not been for one pesky shareholder activist who took Payne’s invitation to ask questions seriously. Evidently Just Share didn’t realise if you’re invited to a pre-AGM meeting, you’re not really supposed to ask questions at the actual AGM. So, for the next 18 minutes or so the Mr Price board had to bat questions about its labels being found in clothing factories in Newcastle where labour standards fell way short of minimum legal requirements.
Non-compliant
During an oversight visit to Newcastle by the Parliamentary Portfolio Committee on Employment and Labour in February, boxed clothing bearing labels of several prominent retailers including The Foschini Group, Pick n Pay and Mr Price were found in a non-compliant factory.
Mr Price management, who said they welcomed the inspection, stated at the end of March the factory had no active orders from it and that it had launched an internal investigation into why the labels were there.
Five months later Kwanele Ngogela of Just Share wanted to know what had the investigation found. “Unfortunately, the investigation wasn’t conclusive into how those labels were located in those factories,” Mr Price CEO Mark Blair told the meeting. Ngogela was not impressed.
By the time fair pay-related questions from Ngogela’s colleague Rachael Nyirongo had been addressed, almost 25 minutes had flown by.
A minute later the meeting was closed.
To be fair to Mr Price, the vast majority of institutional shareholders appear to be very happy to vote ahead of the AGM. In fact, they traditionally submit their votes 48 hours before the meeting. So, nothing new there.
What was new was that the AGM notice stated that “shareholders may participate (but not vote) in the meeting by way of electronic participation.”
Not allowing a vote to shareholders who are participating electronically may be a contravention of the Companies Act. Section 63(2) says companies can hold electronic meetings “as long as the electronic communication employed ordinarily enables all persons participating in that meeting to communicate concurrently with each other without an intermediary, and to participate reasonably effectively in the meeting.”
Does reasonably effective participation involve voting on resolutions?
Saving time
Mr Price’s director of investor relations and stakeholder engagement Matthew Warriner told Financial Mail the group does not have an electronic voting system that enables real time online voting but believes the systems and processes in place are sufficient. “We have considered this before but there has not been sufficient need nor any shareholder request to implement this and we have a consistently high shareholder representation at our AGMs (around 85%).”
Warriner also said it was not correct to suggest shareholders were discouraged from voting during the meeting. “Shareholders are entitled to and are welcome to vote at any point until the final votes are tallied…However the practice and preference of our shareholder base seems to be to vote in advance.”
As for rolling all the resolutions into one proposal, well that just saves time. “Since all resolutions are unaltered from the AGM notice distributed to shareholders in June, and it is reasonable to assume that shareholders attending have already read the notice and are familiar with the content of the resolutions (which are pretty standard and uncontentious), we don’t believe it’s necessary to take time to read them into the record.”
This seems imminently sensible, up to a point.
Certainly, too many chairmen waste a lot of shareholder time reading out each of the resolutions – despite them being standard and uncontentious, and often long – when they could just read out the resolution number and call for shareholders to vote on it. At this stage shareholders could then be invited to ask questions about matters raised by the resolution.
Where the point is breached is lumping them all into one proposal.
But Warriner says this “shortens the formalities and provides more time and focus for shareholder questions”. If only.
Because, also to be fair to Mr Price, fund managers, who are even more skittish about unscripted quasi-public meetings than corporate executives, are entirely comfortable attending the secretive pre-AGM engagements. It’s impossible to know what exactly is discussed at these meetings but implausible to assume some insider knowledge is not inadvertently exchanged.
The NKD elephant
Unsurprisingly, given all the pre-AGM engagement, there was no mention of the German elephant in the room – the unpopular R9.6bn acquisition of German-based discount retailer NKD. Presumably much of the pre-AGM engagement was focused on that, ensuring investor anger could be better contained and not spill into the public domain.
And despite all the engaging, it was evident from the voting that shareholders are still not happy. The vote against the remuneration policy rose to 32.16% from 20.94% at the 2025 AGM while 25% voted against the remuneration implementation this year, up from 21% in 2025.
Predictably, a larger chunk of shareholders want to rein in the board’s power with 28% voting against giving the directors authority to issue shares for cash; last year, only 8.6% voted against the same resolution. And as much as 27% voted against giving the directors control over unissued shares, up from 5.8% last year.
The problem is, as Shane Watkins, chief investment officer at All Weather says, investors don’t like the German acquisition. “So, the company and its generally loyal investor base have detached. And it’s a difficult fix.”
As Watkins sees it: “The relationship of trust between management and investors is damaged. Senior executives are remunerated in large part for having good judgement and this deal brings that judgement into question. Ignoring the question about whether this is a good deal or not, SA investors don’t want offshore acquisitions. Management should be aware of this position.”
It could hardly escape Mr Price’s notice that few people outside the company reckon this is a good deal.
Watkins queries the strategic positioning of NKD. “To earn higher margins requires apparel retailers to sell more fashionable product,” he says. “More fashionable product is bought by younger customers. Information from Mr Price itself shows that 83% of their customers are over the age of 35. Older buyers buy much less fashionable apparel.” Essentially, says Watkins, NKD is locked into a lower margin business.
The Mr Price board might be successful in cynically reducing its AGM to a non-event but if it can’t turn NKD to account there will be nothing it can do to shelter from the very public trouncing of the share price, or from some rather uncomfortable questions.
This article was produced in partnership with Stanlib