Corporate Governance Team Update 2025

The 2025 AGM season highlighted a governance landscape that is becoming more technical, under greater scrutiny and increasingly shaped by investor expectations.

Meeting Formats Continue to Evolve

Issuers continued to trial a mix of AGM formats - hybrid, fully virtual, in person, and in person with webcasting. Hybrid remained the dominant choice, particularly among ASX 200 companies, while virtual meetings were used selectively by issuers with geographically dispersed shareholders.

The Commonwealth Government’s February 2025 response to the Statutory Review confirmed that listed companies may only hold wholly virtual meetings if permitted by their constitution, while unlisted entities retain full flexibility.

Governance and Technology Risks Intensify

Cybersecurity resilience, AI adoption, and data privacy featured prominently in shareholder questions, reflecting both heightened regulatory attention and rising operational risk. Boards are increasingly expected to demonstrate clear oversight of technology related risks and maintain robust protocols to protect stakeholder trust.

Companies also continued integrating webcast and digital Q&A tools. While these broaden access, they require careful governance, clear processes and secure systems.

ESG Expectations Becoming More Technical

ESG discussions evolved further in 2025. Climate related questions became more detailed, with investors expecting evidence based targets, credible transition plans and transparent methodologies. Scrutiny also grew around social and governance issues including culture, diversity, and stakeholder engagement, reinforcing ESG as a core governance matter.

Shareholder Activism and Director Accountability

Protest votes against directors continued to rise, often targeting concerns around overboarding, past governance issues, or performance on other boards. Shareholders are demonstrating lower tolerance for governance lapses, with heightened expectations for director independence, capacity and capability.

Remuneration and ESG-inked Incentives

Investors increasingly assessed remuneration structures through the lens of long term value, ESG commitments and transparent performance criteria. Rather than using the remuneration report as a blunt protest tool, shareholders focused their scrutiny on alignment, discretionary adjustments and the robustness of ESG linked incentives.

Key Focus Areas at AGMs

Recurring themes across 2025 included:

• Director accountability - growing opposition to directors seen as overcommitted or ineffective.
• Remuneration alignment - tighter questioning of performance metrics and ESG integration.
• ESG-linked incentives - increased scrutiny ahead of mandatory climate reporting in 2026.
• AI and workforce impacts - interest in how AI adoption will reshape productivity and roles.
• Company-specific issues - operational performance, cyber resilience and cultural integrity dominated Q&A.

Looking ahead

Boards and governance teams should prepare for:

• Continued restrictions on wholly virtual meetings for listed companies unless constitutionally permitted.
• Mandatory climate and sustainability reporting from 2026, requiring early alignment of governance and disclosures.
• Reviewing Notice of Meeting formats to simplify related resolutions and improve readability.
• Proactive engagement with proxy advisors and stakeholders, which continues to materially influence outcomes.
• Strengthening governance frameworks for AI and emerging technologies, with Boards actively keeping pace with developments.