Jerry Yang, Yahoo!'s 39-year old co-founder, should hope that the San Jose Fairmont hotel which is hosting the search engine's long awaited annual general meeting (AGM), affords embattled chief executives the same level of protection as its rooftop sunbathers.

In keeping with the capital of Silicon Valley, the Fairmont's bathers are shielded by a high tech windscreen to defend them from the glare of sun.

Mr Yang, who is to address shareholders at 10 o'clock today two floors below in the Imperial Ballroom, is unlikely to receive anything like the same kind of shield to protect him from calls from shareholders who want him to resign.

The chief executive has just succeeded in pacifying Carl Icahn, the billionaire shareholder activist who controls a 5 per cent stake in the company, by agreeing to give the 72-year old and two of his allies three places on the board.

But Mr Yang must today seek to appease the rest, and convince them that his vision for Yahoo! justifies the group's decision to reject a $47 billion (£23.7 billion) offer from Microsoft just two months ago.

A handful of institutional shareholders have promised to rip apart the board's decisions to reject two offers from Microsoft, the last of which valued Yahoo! at 66 per cent more than last night's closing share price.

Microsoft approached the Yahoo! board on January 31, offering to buy the company for $42 billion in cash and shares. The approach was rejected.

In May, Microsoft raised its offer by $5 billion, valuing the stock at $33 each, or a 72 per cent premium. A number of shareholders, chiefly Mr Icahn, are livid that they were not given the opportunity to vote on either approach.

Eric Jackson, a Yahoo shareholder who represents a group of investors with around 3.2 million shares between them, plans to confront Mr Yang today: "The Microsoft negotiations were just the latest example of the negligence by this board. There is still a lot of anger and frustration among shareholders right now."

Mr Jackson has form at Yahoo! annual general meetings. Last year, he attacked the performance of the current chief executive, Terry Semel. Less than a week later, Mr Semel resigned and Mr Yang took over.

Mark Nelson, whose investment firm Mithras Capital owns 1.7 million Yahoo! shares believes that Mr Yang's survival as chief executive will hang in the balance today should enough investors voice their concerns about his behaviour: "I haven't spoken to anyone who thinks, 'Hey, this is the right team to lead Yahoo!.' I hope there will be enough shareholder pressure at this meeting for the board to realize they need to bring in someone else to run the company."

While shareholders will not be allowed until next year to vote on Mr Icahn's appointment and his two allies, which are expected to be Jonathan Miller, former chief executive of AOL and Frank Biondi, ex-chief executive of Viacom, they have to approve the re-election of eight existing board members which include Mr Yang, and Roy Bostock, the chairman. Mr Icahn is not expected to appear at the meeting today.

In the letter to shareholders inviting them to vote at the AGM, Mr Yang said: "The vote you will cast for directors .... is the most important for stockholders in our history."

It is not just stockholders and the eight board directors for whom today's meeting is critical. Wall Street is preparing to slice between 5 and 10 per cent off its full-year revenue estimates for 2008, should Mr Yang fail to come up with a plan.

A 10 per cent reduction could be as much as $785 million, depending on which investment bank's forecasts are used.

According to the IT consultant, Martin Warner, co-founder of Technology of Tomorrow: "Yang's vision is not clear. Unless he can inject some real confidence into the room, unless he can come up with something new that takes us on from Microsoft, you will start to see between 5 and 10 per cent revenue dilution."

Analysts have pointed out that Mr Yang could try and appease shareholders with a special dividend, or selling off the search engine's Asian business.

Mr Yang is already facing an uphill battle to convince Wall Street that he did the right thing to reject Microsoft.

After Yahoo! unveiled its second half results last month, Deutsche Bank, the investment giant on Wall Street, gloomily forecast that the shares were only worth $17 each (they closed at $19.89 last night) and that operating profit would probably decline by a third in the current year compared with 2007.

It described Yahoo!'s long term plans for its internet search business as "precarious".

As a further indictment of Mr Yang, Deutsche has told its clients to keep hold of the stock because "the potential of a Microsoft purchase still remains a possibility, especially with Carl Icahn now on the board, leaving doors open for another possible bid".

Adding to the uncertainty for Yahoo! shareholders is whether the joint venture the search engine announced on June 13 with Google will be approved by US regulators.

Six weeks ago, the two companies said they had reached an agreement that allows the smaller group to share in Google advertising.

Yahoo! said it expected the deal to generate up to $450 million of cash in the first year following the transaction.

However, US competition authorities will have to decide whether online advertising is now so widespread that it is fair to argue that Google and Yahoo! do not have a monopoly because they occupy one small corner of the world's entire ad market.

Those authorities could, however, argue that online advertising is unique and separate from mainstream ads, in which case the Google-Yahoo! deal would almost certainly be perceived as monopolistic.

One thing is certain, however, Mr Yang will today face one of the most uncomfortable confrontations of his career.

The Yahoo! share price has fallen 30 per cent since Microsoft withdrew its offer and investors will at last be granted a chance to grill their chief executive on his recent decisions.

But they may well wish that they had followed the example of the two Yahoo! directors - Eric Hippeau and Michael Callahan - who sold 50,000 shares between them on Tuesday for just over $20 each.

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