knowledge | 12 August 2020 |
COVID-19: Considering a Virtual General Meeting in 2020?
As part of the Companies (Miscellaneous Provisions) (COVID-19) Act 2020 (the “Act”), organisations are temporarily permitted to hold their annual general meetings (“AGMs”), and indeed extraordinary meetings (“EGMs”), virtually. In light of the ongoing pandemic and the necessary social distancing requirements and restrictions on gatherings of people, this amendment to the Companies Act 2014 and the Industrial and Provident Societies Act 1893, is a welcome one in facilitating businesses to operate. The Act makes provision for the main issues concerning virtual AGMs and EGMs, including content of the general meeting notice, minimum capabilities of the electronic platform used for the general meeting, quorum and voting.
While it is true that extraordinary times call for extraordinary measures, this particular amendment was expected and in line with similar measures taken in other common law jurisdictions with similar regimes to ours, such as Australia and Canada, where in the latter the law society of Ontario will hold its AGM virtually this year. So, now that your company may hold its general meeting virtually, what should you consider when heading down this path?
Before looking at technologies that can help facilitate a virtual general meeting, first consider and document the best process for your organisation and its members. In going about this task, first take the virtual nature out of the exercise and document how your general meeting would be run as normal, in person. Consider and document how to best facilitate elements of the general meeting, such as member participation and voting, proxies, the speakers and their presentations, and the content and format of the information that would typically be provided to members. Past general meetings will be instructive on all of these elements and will also highlight examples of what worked well from an attending member’s perspective, and importantly what did not. Consider too how the general meeting should be programmed to ensure a natural flow, so that members remain engaged. These considerations, when fully thought through and documented, will provide your organisation with a list of functional requirements that technology platforms being considered must accommodate.
Consider your organisation’s notice requirements for AGMs/EGMs early, and supplement them as needed to meet the Act’s specific requirements regarding information related to accessing the virtual general meeting, how to participate, etc. Go through how your company would typically communicate to the members regarding an upcoming general meeting, and put together a communications plan which incorporates the familiar to members together with the necessary information the Act requires. To ensure that your members are fully informed and that you have a large contingent attending and participating at the general meeting, plan to communicate more frequently with your membership than you otherwise might in years gone by.
Only when you have the process worked out and your functional requirements gathered, should you give any real consideration to what technology platform to use to host your virtual general meeting; do not fall into the trap of purchasing a piece of technology that you must then shoe-horn into meeting your organisation’s needs. You might find that, rather than purchasing new technology, simply adapting technology already in-house will meet your functional requirements and have the added benefit of being security approved and tested. The process map and functional requirements you have gathered will quickly help you eliminate unsuitable platforms due to either their functional limitations or an abundance of unnecessary functionality for your general meeting. The functional requirements will ensure that your members are fully engaged and that an appropriate level of participation will be possible, which will get you most of the way to a successful general meeting.
Next consider how your members will access the platform, the audit capabilities of the technology, and its security. You will want to ensure that access to the platform is as smooth and intuitive as possible for your members, while ensuring that there is an appropriate level of security to verify that each member logging in has the proper credentials. You will also want to ensure that you have an appropriate level of oversight built into the platform allowing you to know who accessed the general meeting, when, and how they interacted with the platform once logged in, and this will be especially true for proxy interactions. Ensure too that the technology platform that you settle on has the appropriate level of security, such that only those invited to your general meeting will gain access to it. Media outlets have recently reported incidents of hackers gaining access to corporate conference calls being conducted on some of the free to use platforms, so be sure to fully test the security of your solution with your supplier.
Finally, ensure the platform is mobile friendly, and that the mobile version meets all of the functional requirements you have gathered. As many are still working from home, access to a traditional desktop may not be possible for all of your membership, with some relying on cellular phones or tablet computers to continue working. This must be factored into your considerations when deciding on a platform, and thoroughly tested.
Practice, Practice, Practice:
Expect problems to arise, and in your planning try to mitigate against them as best you can. Some suggestions are:
- Set aside time to rehearse the AGM/EGM from start to finish, and perform this rehearsal more than once;
- Send your communication materials to test users, to ensure that the instructions relating to accessing the platform are clear and concise;
- Test user access to the platform, and have a plan in place to deal with troubleshooting issues in real time;
- Ensure that only invitees can access the platform, and probe the security with dummy accounts if necessary;
- Ensure that any materials you are providing ahead of time can be accessed by test users;
- Ask your speakers to go through their presentations, and ensure that they are heard and that their content is seen by test users; and
- Test the functionality that will facilitate member participation on the platform (questions, voting, etc.).
Again, ensure that all of your testing includes users who will be relying on mobile devices. In taking the time to perform these tests you will significantly reduce the number of issues arising on the day of the general meeting.
Your virtual general meeting will be a first, and like anything new, some unforeseen issues will likely arise. However, with careful planning and testing these issues should be minor, and will instead serve as helpful lessons for future virtual events.
How Can We Help:
McCann FitzGerald is expert in advising clients on all matters relating to good corporate governance. Our Digital Services team are proficient in utilising the available, industry leading tools to facilitate our clients’ needs, and providing advice on how our clients might get the best and most efficient use from their in-house technologies.
Also contributed to by Andy McDonnell
This document has been prepared by McCann FitzGerald LLP for general guidance only and should not be regarded as a substitute for professional advice. Such advice should always be taken before acting on any of the matters discussed.