Update: More change for AGMs under coronavirus (COVID-19)

How to hold an AGM while facing the fallout from coronavirus (COVID-19) — but still be compliant with the Corporations Act — is an issue many organisations continue to traverse as they plan for their meetings in May.

And as the Federal Government continues to ramp up its restrictions on gatherings and distancing, the hybrid meeting that many had turned to as their contingency plan may no longer be an option.

In light of the most recent changes and as all eyes turn to the option of holding a virtual AGM, the Governance Institute has been in discussion with investor representatives and regulators this week.

Governance Institute CEO Megan Motto today encouraged companies to keep in regular contact with their shareholders and investors as the situation evolves.

“There are 290 ASX-listed companies who are due to hold their AGM by 31 May and the situation is changing rapidly,” Ms Motto said.

“Arrangements made last week are no longer feasible this week.

“We encourage companies to liaise with their shareholders and significant investors about their arrangements and bring them up to date as circumstances change. Encourage them to lodge proxies.”

The UK’s Chartered Governance Institute has issued a guidance on holding virtual AGMs following their government also issuing orders prohibiting public gatherings of more than two people. The bulletin ‘AGMs and impact of COVID-19: Supplement’ outlines the remaining AGM options for organisations and can be found here.

As outlined in the Governance Institute’s recently released Guidance — COVID-19 and the impact on AGMs, companies due to hold their AGMs should consider:

• Contacting your registry and technology provider to discuss arrangements and contingency plans.
• Establishing a dedicated AGM area on the company website. This area would include the details of arrangements for the meeting, links for web-streaming and can be updated to reflect changes to the situation, including about attending the AGM. Where appropriate, updates can also be given by announcement. Encourage proxy voting. Include specific provisions in the notice of meeting encouraging shareholders to vote by proxy. Facilitate online voting and online proxy lodgement to pre-empt any disruption to postal services. Supplement this with appropriate announcements and website updates. While shareholders can choose any proxy they want – encourage them to choose the Chairman, to avoid requiring other proxies to attend in person.
• Establishing an online shareholder Q&A for the AGM. Shareholders can post questions related to the business of the AGM. To the extent practicable, this should be kept up to date with answers up to the deadline for proxy voting. Questions can also be answered at the AGM, in particular, if the AGM is live streamed.
• Consider announcing a shareholder event to be held later in the year. Although this will not be the AGM, companies may wish to offer shareholders, particularly retail investors, the opportunity to engage with directors later in the year.
• Ensure the AGM will be quorate. Generally, this is likely to require a small number of attendees (2-5) and relevant provisions will be in the constitution.

Stay tuned for our further updates on this developing situation.