Shareholders of Standard Life Aberdeen have revolted against a proposal they feared could have allowed the Edinburgh-based fund management giant to replace annual general meetings with virtual, online meetings.

The rejection of the proposal by about 37% of shareholders meant the resolution calling for a change to the company’s articles of association was defeated — because the resolution required a 75% majority.

The shareholder rebellion ironically took place at the firm’s AGM on Tuesday which had to be held online due to the current lockdown.

Standard Life Aberdeen said it has “no plans to do away with physical meetings” but it “believes that allowing shareholders to also participate by electronic means would be in the interests of shareholders and allow engagement with those unable to travel to the meeting.”

In a statement, Standard Life Aberdeen said: “Resolution 16, which was proposed as a special resolution and which proposed amendments to the company’s Articles of Association, was not passed, and accordingly, the Articles approved at the 2018 AGM remain in force …

“The board recognises the significant percentage of votes cast against this resolution.  

“The board believed that the proposed update to the company’s current articles was uncontroversial and appropriate. 

“One of the proposed changes was to provide the company with the option to allow for shareholders to join meetings remotely and to convene meetings at which electronic facilities were available for remote participation; this would address the constraints currently in force that prevent gatherings of more than a very few participants. 

“Feedback suggests it was this element that caused investor concern. 

“We understand that some shareholders were concerned that the company could and possibly would use the permission to hold ‘virtual’ meetings with no shareholders present.

“The board recognises the importance of the AGM and values engaging with shareholders, in particular due to the strong retail shareholding in the company.  

“The board has no plans to do away with physical meetings, but believes that allowing shareholders to also participate by electronic means would be in the interests of shareholders and allow engagement with those unable to travel to the meeting.

“In the coming months, we will engage with institutional shareholders on the concerns raised on this resolution.  

“In accordance with the UK Corporate Governance Code, we will publish an update on that engagement within six months of the AGM.”