Need advice on how to run an annual general meeting?
Even for private companies for whom AGMs are not a statutory requirement, holding an annual meeting is a great tool for shareholder engagement. However, in the era of social distancing, Annual General Meetings have become somewhat of a logistical challenge.
With government restrictions preventing large gatherings, companies have been forced to adapt their arrangements to allow AGMs to go ahead in spite of the circumstances. In light of the recent rule-change that has seen the 6-person limit enshrined into UK law, it looks like virtual meetings are here to stay for the time being. Regardless, company secretaries have the same responsibility to assist the Chairman with the pre-meeting preparation.
If this is your first virtual AGM, you’ll be making company history – so, no pressure!
Through our company secretarial services, our corporate lawyers have worked with a plethora of both private firms and public organisations to assist with meeting preparation. We’ve picked their brains to compile the top tips to help you prepare for your next AGM in the following guide.
Giving notice
Where has the year gone? If that time of year to hold an AGM has rolled around, it’s essential you give notice to all attendees in advance. For public companies, the notice period provided should be at least 21 clear days ahead of the proposed date.
When giving notice, you should also make clear the portal that will be used for the call, giving attendees enough time to download the program and get their camera/audio working.
Depending on the circumstances, you may need to provide a longer period of notice to ensure all members can attend. There are statutory provisions allowing members to agree to short notice, but this will only be practical for companies with a small number of members.
Logistics
Conducting a virtual AGM may relieve you from booking a meeting room and buying refreshments, but there will be a number of logistical issues to iron out ahead of the meeting.
Ensuring that the platform you are using to host the meeting supports the number of expected attendees is a good start. Certain video conferencing tools will restrict the number of participants, so remember to do your research.
You should also choose a portal that allows for real-time voting on individual resolutions and align this to the Chairman’s script. A clear voting system should be explained clearly at the start of the meeting – for example, will you have a show of hands? Will it be a ‘first past the post’ decision?
Ahead of the meeting, it’s also worth nominating a deputy Chairman who can step in should the Chairman have technical difficulties – after all, connections can and do drop. Prevent the awkward silence by getting back-up plans in place long before the AGM.
Scripts and minutes
A good AGM needs a script to ensure the meeting runs to a structure and all key points are addressed. It’s also a useful tool should the meeting be derailed by disruptions or require adjournment. As part of pre-meeting preparation, it’s wise to put together a script for the Chairman that covers procedural matters as well as a secondary script that covers matters that may arise at the meeting.
During the AGM, you will need someone to take minutes of actionable points and decisions made. The nominated minute-taker should ensure to take clear notes for record of elections and changes to the constitution.
Q&As
While you may not be able to pre-empt every question that members may pose during the AGM, you should still aim to summarise answers on a wide range of potential questions that could arise from the meeting.
You may find it practical to circulate a list of answers to questions you anticipate arising to members before the meeting or making such Q&As available on the company website – this will save having to address them at the meeting itself.
Limits on disclosing information
If a shareholder asks a question during the AGM that would require disclosing confidential information, it’s essential the Chairman is warned in advance of such subjects so they can decline to disclose. Again, you don’t need to pre-empt the exact question – a list of key areas will suffice.
Company secretaries may find it useful to simply prepare a pack for the Chairman that will include briefing notes, Q&As, limits on disclosing information and other issues such as share price analysis, press coverage and analytics that showcase recent growth and achievement of company objectives.
Rehearsal
Even before virtual meetings became the norm, AGMs benefited from a rehearsal meeting with the Chairman, CEO, CFO and other senior executives who would be speaking in the meeting.
Now more than ever, a rehearsal will be beneficial in ensuring the Chairman and executives are familiar with the script ahead of the meeting and that all members are technologically equipped to attend and participate. By giving enough notice, technical issues such as internet connections, audio problems or poor image resolution can be resolved to ensure a smooth and successful AGM.
If your organisation is due an Annual General Meeting and you think you may need further guidance from a legal perspective, don’t hesitate to get in touch with our team. Our dedicated lawyers can provide reliable company secretarial services to ensure your AGM follows the right legal procedure and model rules for the business.