London, 17 March 2020 – The Chartered Governance Institute and Slaughter and May have today published guidance about company AGMs and the impact of Covid-19 in order to support British businesses and their shareholders during the coronavirus pandemic. Supported by the FRC, GC100, the Investment Association and the Quoted Companies Alliance, and reviewed by the Department for Business, Energy and Industrial Strategy, the guidance suggests that companies consider their contingency plans in light of the spread of Covid-19.
Paul George, FRC Executive Director of Corporate Governance and Reporting said:
“As the AGM season rapidly approaches, companies need to manage the risks presented by the spread of coronavirus transparently whilst ensuring shareholders continue to have the maximum opportunity to have their say.
The Guidance offers practical support for companies on holding AGMs and they should familiarise themselves with it now to manage any risks whilst meeting their reporting responsibilities.”
The options laid out by the guidance, which reflects UK law and regulation, are as follows:
- Adapt the basis on which you hold the AGM
- Delay convening the AGM, if notice has not yet been issued
- Postpone the AGM, if permitted under the articles of association (Articles)
- Adjourn the AGM
- Conduct a hybrid AGM, if permitted under the Articles.
Given that the situation continues to evolve, companies may ultimately have to use more than one of these options.
Peter Swabey, Policy and Research Director at The Chartered Governance Institute advised:
“It is important that companies balance the need for pragmatism in the light of the Covid-19 outbreak against their legal and regulatory obligations and good practice. In my view, as a general rule, they cannot go very far wrong if they try to maximise the opportunity for shareholders to take part in the meeting. Encouraging proxy voting, the establishment of an online shareholder Q&A for the AGM and live streaming the AGM are all sensible measures to consider and companies may also choose to offer an opportunity for retail shareholders to engage with the board later in the year. Companies should also remember that it may become necessary to postpone or adjourn the meeting if the situation changes. A dedicated area on the company website should be established to provide shareholders with the most up-to-date information.”
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For further information, please contact Maria Brookes, Media Relations Manager:
mbrookes@icsa.org.uk
+44 (0)20 7612 7072
+44 (0)7890 649 143
Notes to Editors:
- The Chartered Governance Institute is the qualifying and membership body for governance with over 125 years’ experience of educating and supporting governance professionals. With a Royal Charter purpose of leading ‘effective and efficient governance and administration of commerce, industry and public affairs’, we provide professional development, guidance and thought leadership, and work with regulators and policy makers to champion high standards. Website: www.icsa.org.uk
- The guidance can be downloaded at www.icsa.org.uk/covid-19