Private Investor: Why do institutional shareholders get special treatment?

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The Independent Online

I regret to say that I did not turn up at the Shell annual general meeting on Monday.

I regret to say that I did not turn up at the Shell annual general meeting on Monday. I do wish I had. It sounds like some of my fellow small shareholders made a spirited attempt to make the board explain what has been going on at the company lately. A Mr John Kennedy seems to have been a particularly impressive have-a-go hero. According to reports, he put this question to the board of directors: "I am quite sure you were in consultation with institutional shareholders, so why were private shareholders left out?I had to rely on the press!".

Oh dear. What has the world come to when we have to rely on the press? I'm being facetious. Mr Kennedy made a valid point.

I don't suppose there is a way that the body of private investors as a whole can be allowed the sort of briefings that the big pension funds receive as a matter of course, but then again perhaps that is an argument for these large institutions not being offered privi- leged information ahead of other investors. After all, one of the basic principles of a fair market is that the same information should be provided to all.

Shell only seemed to honour this ideal while it was providing the same disinformation to all, a slightly different idea. OK, that's a cheap crack, but when you're having to pay for former chief executive Philip Watt's leaving present of £1m, as we, the owners of Shell are, then you have to make some economies. Shell shares are back from the brink, at 410p, but have yielded shareholders miserable returns over the past five years, although they no longer seem to be underperforming BP (more to do with the latter's recent relative weakness than anything else).

Which brings me, briefly, to the depressing state of Marks & Spencer. The dizzying spectacle of claim and counter-claim is truly unedifying. Just when you thought that things couldn't get any worse at M&S, we are treated to this. I do not know how the poor staff in the shops can cope with this level of uncertainty, but I admire their bravery. If Philip Green doesn't put us out of misery, I hope someone will soon.

Elsewhere, I am pleased to see other components of the portfolio making steady progress. Rolls-Royce at over 250p and Tesco at over 260p are making good unobtrusive gains, while BT, at around 200p, justifies the purchase I made on the back of its broadband claims a few weeks back. I notice that the company has pledged to cut its broadband prices by a quarter and, assuming there isn't some self-defeating sort of catch involved, is another piece of evidence that there may be a little more life in this old dog yet.

Equally, I am displeased to witness the unobtrusive decline of Vodafone and BSkyB, two shares which also form part of my core portfolio, with its bias towards TMT stocks. Vodafone looks like slumping back below 120p. There have been one or two bits of negative news lately, but I cannot really see why it's in the doldrums. It certainly isn't an ideal backdrop for Richard Branson's proposed flotation of Virgin Mobile.

BSkyB is equally becalmed, and here I can see more point to it. Any economic slowdown would hit BSkyB's business quite badly, especially when the company seems intent on putting its prices up with such apparent frequency. On the other hand it has also amazed me that there are people out there willing to pay hundreds of pounds a year for television shows when they can get the same sort of stuff (OK not the premiership) from ITV and the BBC for nothing. In fact, around 7 million BSkyB subscribers spend about £400 on the average, figures that will probably grow in the long term.

Still, makes the licence fee seem very good value.

s.o'grady@independent.co.uk

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