Are In-Person Shareholder Meetings Outdated? The Value of Implicit Communication

Abstract Following the COVID-19 pandemic, many Asian countries have allowed virtual shareholder meetings. These meetings can not only prevent the spread of infection but also lower companies’ costs and facilitate shareholders’ participation. However, in virtual meetings, shareholders may lose a significant portion of implicit communication—communication through nonverbal elements—with management and other shareholders, a factor which has not been fully recognized as a benefit of in-person meetings. If this benefit is not sizable, then making a shareholder meeting non-mandatory is reasonable, whether in-person or virtual, because the other benefits of these meetings are not significant. However, some evidence shows that the benefit of implicit communication may be important for shareholders in many cases. If virtual meetings cannot sufficiently realize this benefit through virtual reality, it would generally be desirable to use them as a complimentary tool for in-person meetings, not as a substitute.