In this year’s Annual General Meeting ‘season’, there will be no free lunch available or having to deal with tricky live questions from your membership in quite the same way that you would normally.
We have already seen a number of large corporate organisations holding their AGMs behind closed doors due to the coronavirus outbreak, with some only attended by a few shareholders after the Government restricted public gatherings of more than two people. Votes received by proxy through the Chairman have been the order of the day, as have written questions submitted in advance, even though their rules do not necessarily allow for a meetings of this kind to be held virtually or digitally.
However, the current situation means that we must find other solutions for such meetings if we are to meet our statutory requirements. The Trade Association Forum’s own Memorandum and Articles of Association do not allow for a virtual meeting, but it does not prohibit them either. As this is the case, the TAF Board have taken the decision to hold the meeting virtually, using an appropriately secure meeting platform. We are certainly not the only trade association to make this decision, though of course there are both pros and cons to taking this approach.
A virtual AGM will have an identical structure to a physical AGM, but it will be carried out via appropriate digital means. There are instant cost advantages to this in terms of venue hire, etc, and it may well be easier for stakeholders to attend a virtual AGM than take time out to come to a meeting physically. However, it seems there is still reluctance for some to conduct a virtual AGM, which may in part be down to a lack in confidence in the technology available, though confidence in using online platforms does seem to be increasing as we are all using them far more frequently than we would otherwise. Should the meeting fail due to technology issues, then this is potentially embarrassing. There is also the view that established organisations may have an entrenched membership base that much prefers more traditional meetings.
Some consider that time and expense required to conduct a physical AMG is not justified due to low attendance, and a virtual AGM does make it more accessible to all and can increase member engagement.
So how do we prepare for a virtual AGM? It is important to check your Memorandum and Articles of Association before conducting a virtual AGM. It is unlikely that they will expressly prohibit an electronic meeting, but there will be clauses regarding notice of AGMs and the need to state the place of the meeting, which may make it difficult.
Members should be able to both speak and vote at the meeting which will require the use of appropriate technology though provisions can be made as mentioned above for proxy voting and questions in advance. It is important that the Chairman is able to identify who is present, which can be a bit more problematic in a virtual AGM if the participant is not visible and has dialled in using a phone. You could increase the level of security for the meeting by issuing a unique username and password for each participant to use when joining the AGM to help with this and it may be helpful to provide a helpline number of the notice of the meeting for those that encounter problems. It is a good idea to test your technology thoroughly in advance to ensure that any electronic votes can be counted and that it addresses any specific requirements you may have as an organisation.
The usual AGM requirements relating to quorum, notice periods and documents available will of course still apply.
The Trade Association Forum has further guidance available for members on holding virtual meetings. To obtain a copy, contact Linda Cavender or Mario Yiannacou.