Climate action is on the minds of businesses worldwide, as many professionals and industries look for innovative ways to lower their carbon footprint. Whilst the pandemic has severely disrupted business continuity, it has provided a unique opportunity for innovation, as many organizations make broad changes to how they operate. The disruption has also had a great impact on the investor relations world, (a space which hadn’t seen much innovation to its modes of operation- think, physical meetings in capital cities) in the wake of Coronavirus however, practitioners and businesses alike were forced to confront a changed landscape and move online.
In 2020, more businesses than ever took the plunge and moved their AGM online- either embracing a totally digital format or shifting towards a hybrid approach. At Lumi, we serviced over 3000 hybrid and digital meetings in that year, offering organizations certainty in the face of global upheaval. Whilst the move paid dividends for shareholder engagement, it’s has also had a significant positive impact on the environment. Whilst environmental concerns aren't at the top of the agenda for boards, a shift in mindset towards sustainability might be the key to unlocking increased shareholder engagement, perceived stakeholder value and greater business innovation. As Cathy Conlon writes for Corporate Secretary Magazine, the environmental impact of the shareholder meeting was previously much overlooked by big business, however: “we believe environmental concerns should be a key consideration. Our data shows that, compared with in-person events, VSMs can help issuers reduce their AGM-related carbon footprint by 99.9 percent.”
So, what is the carbon cost of the shareholder meeting?
In studies undertaken by academics and climate researchers, it has been found that the average shareholder meeting, lasting three days with 1000 shareholders in attendance, generates 584 tons of CO2 emissions. To put that into context, that’s the equivalent of flying from Heathrow to New York, return, 162 times. That's a lot of carbon.
As Conlon writes, when it comes to measuring conference carbon emissions, there are three major factors:
- Travel- Does your meeting entail international travel? Flights? Cross country travel? If your organization is looking to convene board members and directors, there’s a good chance this will involve private chartered planes, helicopters or business class flights. Unlike mainline seats, which are somewhat offset by the number of travellers in the cabin, private flights can be a more severe contributor to carbon emissions.
- Hospitality- Whilst providing a catered, overnight service to shareholders may seem like a normal aspect of the shareholder meeting, the carbon impact of a buffet service and hotel stay is likely more than you think. Hotel stays can significantly ramp up your carbon footprint thanks to the energy required to heat and cool rooms, and wash linen. In an investigation undertaken by Econemtrica, it was discovered that a typical hotel stay produces 50 pounds of CO2 emissions per night.
- Materials- From leaflets and fobs to ID badges, booklets, merchandise and more, the amount of physical materials required to bring a shareholder day to life can amp up the carbon impact of your organization. From unsustainable forestry to provide the pages for your handbook and increased single use plastic, the outlook for sustainability is not good.
Although moving online won’t remove the total carbon footprint from your shareholder meeting (unfortunately it does take some carbon output to heat and cool data servers) a virtual meeting provides your stakeholders with an opportunity to take control of their carbon footprint without the pressure of an in-person meeting. Organizationally, a digital meeting helps your business to more responsibly manage your shareholder base, without adding additional environmental burdens to your existing carbon output.
If your business is looking to make the first meaningful steps towards environmental equity, moving your shareholder meeting online provides stakeholders with reassurance that your organization’s commitment to environmental change isn't simply green washing. And with the environment on the minds of more shareholders across the globe, moving online has got to be good for business.
If your organization is looking to host your next AGM online, get in touch with one of our experts today.