There have been a number of blog pieces etc which came out very soon after the Celtic PLC AGM which took place on 17 November 2021. Most of these were from people who were more observers than participants in the proceedings so, even though it is now a week later, we felt it important, as an organisation which seeks to represent small shareholders, as well as the wider support, to give our account of the run-up to the event, the meeting itself and the aftermath.
In preparing for the meeting, we were undoubtedly caught on the hop by the news, directly from the Company Secretary, of the meeting date. The information came at a time which gave us 4 days (including a weekend and a European game) to get the required number of signatures in to support our two resolutions. The fact that we were able to do that comfortably is a testament to the power of the increased number of Trust members in recent years and the efforts we have made to ‘get the vote out’ more widely among small shareholders. We hope that our current project – the Drive for 5 and the associated new infrastructure which enables shareholders to register for updates at AGM times – will make this task even easier for future AGMs. The fact that we have been assured that all AGMs will be in mid-November unless advised otherwise is also helpful in terms of planning.
There has been quite a lot of confusion online about the nature of our resolutions. There appears to be a view that resolution numbers carry over annually and that those with the same number are on the same topic. This is a misconception. The first ten resolutions, put forward by the Board, are usually pretty routine and are put every year. This, of course, means that any shareholder requisitioned resolutions will take the numbers 11, 12 and so on. This does not mean that Resolution 11 in 2021, for instance, is necessarily related to Resolution 11 in any past or future year – they are just numbered in order.
In this particular instance, while the 2021 Resolution 11 does hark back to previous AGM discussions, it is not the same resolution as has been discussed for some considerable time. This year’s resolution 11 simply asked the PLC Board to report back on a commitment to pursue certain matters with the SFA which it made to the 2020 AGM and asked the meeting to note that the way Celtic has handled the subject matter in the past has raised concern among shareholders. It was not asking Celtic or any other body to do anything else. This resolution was carried overwhelmingly in the room.
Resolution 12 this year asked the PLC Board to take steps to improve the corporate governance of the PLC by beginning to plan the replacement, over the next year or so, of the Non Executive Directors who have been in place for far longer than is healthy in terms of governance. It is our view that they are no longer independent of the Board as they are required to be. It also asked the PLC Board to set in place a relationship agreement between the principal shareholder and the smaller shareholders in order to protect the interests of the smaller shareholders. This is not ‘unusual’ as suggested by the Chair at the meeting and is certainly in keeping with the standards to which Celtic PLC are signed up. As paraphrased by Trust member, Ray Neil, at the meeting, the Board’s response was that the directors had looked at themselves, all agreed they were doing a grand job and found no reason to make any changes to the membership of the Board. Those in the room disagreed and, again, overwhelmingly, supported the Trust motion.
As those of you who are shareholders know, prior to the AGM, you are invited to proxy your vote (to the Chair, to the Trust or to anyone you choose) and to indicate, if you wish, how your vote should be cast. On the basis of those votes it is the Chair’s job to take a view as to whether the votes in the room (by show of hands) conflicts with the proxied votes. In the case of the two Trust resolutions, as is always the case, the show of hands conflicted with the majority of votes cast by proxy (or in other words Dermot Desmond’s and the rest of the Board’s shares were voted against these resolutions in advance of the meeting). A poll was therefore called and those in the room had to cast their votes (physically in a polling box) and these were added to the votes of those who were not in the room but had voted in advance. This, as you all know, overturned the vote in the room as expected.
What was less expected and what, to my knowledge, has never happened before was that the Board resolutions calling for the re-election of some of the directors (this is done in rotation according to a fixed timescale) was not carried in the room. The Chair was clearly surprised that the vote to re-elect Brian Wilson was not carried but he was astonished that the vote to re-elect him was rejected by almost all of the hands in the room! This was the beginning of the end for him in terms of any competency in chairing the meeting (such as it is at its best!).
We would argue that the votes on Dermot Desmond and Tom Allison’s re-election should also have gone to the poll as they seemed to be about 50-50 in the room. However, the Chair chose to declare them carried – polling on Desmond was probably not something he fancied explaining to our principal shareholder.
People should not underestimate the significance of these votes. Many people on social media are proclaiming that none of it matters because the big guns always carry the day. They are wrong to ignore the significant embarrassment caused to the Chair and the Board by the public rejection of them at the AGM. These people were not embarrassed by the shambles of what should have been the 10-in-a-Row season and they were not embarrassed by the ludicrous Dom McKay entry and exit but they will be embarrassed, if not enraged, by this. The flow of speakers to the floor who questioned and harried the Board on a range of important (to the supporters) issues seemed incessant and Bankier struggled on almost in the manner of Boris Johnstone’s recent speech – haplessly. Issues around the performance of the Directors, the issue of referees, the way in which Celtic was treated by the Scottish Government and, importantly, the rumoured appointment of Bernard Higgins to a senior security role at Celtic Park were all put forcefully to the top table. All the Chair and the acting CEO had in response was to refuse to comment or to endlessly repeat the words ‘Fans Forum’ – more of that on another day! However, this is not job done. Our aim is not to embarrass them – our aim is to wrest some power from them.
This brings me to the aftermath of the AGM itself. As well as the publishing of the votes which overturned the show of hands in the room, there are other issues to consider.
As a result of some extremely hard working and creativity by the Celtic Trust Communications Sub-Committee, the number of individual proxies to the Trust were as high as they have ever been. However, that amounted to 390 individual shareholders out of a total of almost 28000. Think about this – if you knock 30 at most from that figure as those who are the ‘big guns’ then that leaves…well…almost 28000 of people like us – ordinary supporters. We got less than 400 to proxy their vote to us. In terms of shares voted, around 80.3 million shares were cast – that is around 75% of those shares that could be voted. The vast and overwhelming majority of that 75% is in the hands of the big investors. The missing 25% is mainly ordinary, small shareholders who, year after year, don’t bother to vote.
The votes in favour of our resolutions and against the re-election of Bankier and Wilson were between 940,000 and 989,000. That amounted to around 1.2% of those cast. A paltry figure in itself but one which could be increased significantly if we could get those other 25% of shares (held by around 28000 people) voted. Just over 26.8m ordinary shares were not voted and if even half of these were voted then we would start to see change. The change would not come because this constitutes a majority – it doesn’t. Change would come because of the dynamic effect of a real challenge to the power of the existing Board. Minds would start to turn towards to possibility of change and some of the larger shareholders, who themselves are not happy with the Board, might start to believe that change can be achieved and join with us. Most of the people we regard as the big guns now have a far smaller stake than 25% so our combined power is not insignificant if we can only mobilise it.
So, to sum up, they got their vote out and we didn’t get ours out. That is the long and the short of it. Hence that is why we need to now turn our attention to the Drive for 5 campaign and really get to work. This is a long game, and it might take us a while yet, but change is possible, it is necessary, and we have a clear mechanism to achieve it. Join us and make it happen!