Clarification from government on whether companies can hold online general meetings (“An end to sandwiches and protests? The rise
of the virtual AGM”, Report, FT.com, May 6) cannot come soon enough.
A change to the 2006 Companies Act is needed to clarify whether meetings can or cannot be solely held online. At the moment, it is a grey area and we are sleepwalking into wholly online meetings becoming the norm without a proper debate. The nature of annual general meetings, such a cornerstone of UK-listed company governance, should again be the subject of wider debate now that technology and our ways of engaging with each other have moved on.
The government’s forthcoming legislative changes must consider whether shareholder engagement might be compromised without an option for face-to-face discussion, and provide clarity for both companies and their investors.
The updated law should also relook at strengthening company powers to manage the safety and security of meetings, and whether more should be done to enfranchise indirect investors such as those who hold shares through a broker or nominee. This may become a greater issue if the government changes the rules for individuals savings accounts (Isas) to divert current cash savings into stocks and shares.
Acceptable practice is starting to be determined by the decisions of a few outlying boards who are testing the boundaries by holding wholly online meetings. The government’s guidance must address this.
Bernadette Young
Co-founder and Director
Indigo Independent Governance
Westcliff-on-Sea, Essex, UK
