The annual general meetings (AGMs) of major companies provide a crucial platform for wider society to understand, critique and shape company policy and strategy. These face-to-face interactions enable us to raise topics that impact significantly on employees and workplace culture. This is why HPC oversaw a significant AGM season for 2025, attending the meetings of all FTSE 100 retail firms taking place in London and the South East — including major household names such as Tesco, Sainsbury’s, and M&S — to engage them on the topic of employee engagement.
High Pay Centre research has shown how heavily retail firms typically rely on low-earning shop floor staff, contributing to substantial internal firm inequality levels. The significant size of these workforces can also often mean the link between board decision-making and employee interests is a weak one. Given this, as well as the constraints of the cost-of-living crisis, we felt it was more important than ever that we attended these meetings.
Why Employee Engagement?
We asked two questions to get to the heart of what large retail firms are doing with regard to worker voice: What are they currently doing to ensure the views and interests of the workforce are being heard and acted upon? And would the board commit to looking into the potential for adopting a worker director to help ensure that the needs of the wider workforce are adequately represented?
Meaningful employee engagement and voice are vital because they provide employees with influence over the decisions that directly affect their work and wellbeing. Research shows that engaged employees typically exhibit higher morale and increased productivity levels. Intuitively, when workers feel heard and valued, it fosters a sense of ownership and motivation. Given that Gallup data shows only 10% of UK workers feel engaged in their jobs, taking steps to improve engagement could be pivotal in boosting both individual and societal fulfilment.
Worker Directors
Currently, no FTSE100 firm has adopted a worker director. This is particularly striking given that the Corporate Governance Code directly recommends this as a mechanism for establishing worker voice, workforce directors are well-integrated into the corporate culture of many European nations and a wide array of stakeholders have called for their adoption.
Research and development expenditure is twice as high in those European countries with strong worker representation compared to those with weak participation. This is understandable — employees will be naturally incentivised to favour investment into the business, reflecting how mechanisms like worker directors can help direct boards away from corporate short-termism that has often had damaging consequences. Furthermore, worker directors would diversify the life and professional experience of the board, including the operational understanding of the company, reflecting the potential to improve the effectiveness of business decision-making.
What happened at the AGMs?
While each company we spoke to acknowledged the importance of employee engagement to their business model, there was a disappointing lack of evidence indicating where they had made genuine efforts to establish this. Companies often referenced employee surveys or town hall meetings with the workforce, though when pushed on what impact these had had in affecting company decision-making, detailed responses to this were absent. Unfortunately, this is illustrative of how employee engagement is often treated as a box-ticking exercise designed to ensure compliance with the governance code.
Such findings highlight a clear gap between rhetoric and reality when it comes to employee engagement. To address this gap, HPC will continue to advocate for strong employee voice mechanisms—both through direct corporate engagements as well as through research and policy efforts—to ensure these mechanisms are both meaningful and effective.