BY JEFFREY GOLDFARB

The new virtues of conducting business virtually will be up against old realities in 2021. Zoom Video Communications and its ilk have changed corporate behavior, often for the better. Yet the gravitational

pull of meeting in person is a powerful force.

Some perks of the digital working world outweigh the screen fatigue. Executives providing advice and professional services, for example, relish living on the ground instead of on an airplane. Ken Moelis is allowing investment bankers at his eponymous boutique to relocate far from the New York headquarters if they want.

Employers and clients also appreciate the related savings. HSBC was on track to spend less than $100 million on travel and entertainment in 2020, down from $400 million a year earlier, Chief Financial Officer Ewen Stevenson said in November. He expects a “modest snapback” in 2021.

As for mergers, there may be fewer mid-transaction flights involved, but it will take only one deal lost to a rival who pitched in person for throngs of M&A bankers to jump back into their business-class seats.

And while far more efficient digital roadshows should continue post-pandemic for many initial public offerings, some investors will want trust-building live interactions. Smaller stock issuers may struggle to drum up interest without pounding the pavement.

Online corporate get-togethers have cons as well as pros, too. Broadridge Financial Solutions, which supplies technological plumbing for funds and others, said it hosted about 2,000 virtual shareholder meetings in 2020, up from 300 in 2019. What’s more, it reported voting participation of 71%, higher than for the offline cohort. Although digital attendance prevents the decades-old trick of dodging investors by holding annual gatherings in faraway places, there is instead the risk of companies cherry-picking which shareholder questions to answer. Nor are internet links yet 100% reliable. Home Depot and others are aiming for an in-person format in 2021.

Many board directors also may want to sit around the same actual table again, for at least some meetings. Virtual sessions can be shorter while expanding the range of potential director candidates, but a survey co-led by the Governance Institute of Australia discovered some resistance. Missed body language and informal interactions were among the complaints. Fewer than half the respondents said they would keep convening by video conference “frequently.” Face-to-face business habits will die hard.

First published December 2020