Updated Q&As in relation to shareholder meetings

09 Jun 2020

The Department for Business, Energy & Industrial Strategy and the Financial Reporting Council have published an updated version of their Q&As on filings at Companies House, Annual General Meetings (AGMs) and other shareholder general meetings during COVID-19 pandemic.

The updated Q&As, which focus on meetings, can be found here.

The previous version of the Q&As has been highlighted in DMH Stallard’s coronavirus hub here.

The Q&As have been updated to include guidance on best practice for AGMs and other shareholder general meetings following publication of the Corporate Insolvency and Governance Bill 2020, further details of which can be found here.

The Q&As set out a number of principles, bearing in mind that not all organisations will want, or need, to exercise the temporary flexibilities in full. Companies are advised to monitor and review their position and take a view on what approach best balances the safety of members and their legitimate expectation to be afforded engagement with the board. The guidance considers options such as the possibility of convening a physical meeting with a representative cross-section of members and the need to explore how members might actively participate by virtual means.

The guidance also sets out features of good practice with regard to member communications, including:

  • Timely communication to ensure members can consider the matters to be voted on
  • Clarity on proxy voting
  • Explaining in advance the procedures for the meeting and any prior communications
  • Giving all members the opportunity for Q&As prior to voting either at a real time online meeting or via proxy
  • Making answers to any questions raised available to all both in the meeting (including online) and in written form following the meeting
  • Offering a physical meeting to all shareholders once government restrictions are lifted

The guidance suggests that, over the longer term, there may be a benefit in moving to a hybrid AGM format enabling attendance both in-person and online. The Financial Reporting Council plans to produce an assessment of best practice later this year.

If you require legal advice on any of these issues, you should get in touch with your usual contact in the DMH Stallard Corporate team, or Nick Williams at nick.williams@dmhstallard.com.

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