The future of AGMs in the wake of COVID-19

March 2020 / Link Group

With the current COVID-19 pandemic constantly evolving, how can organisations ensure they meet their 2020 AGM obligations in the face of health & safety concerns?

The fallout from the spread of the COVID-19 coronavirus in recent months has meant that contingency planning is at the top of the agenda for most organisations. With health & safety guidelines evolving daily, global governing bodies are offering solutions to help organisations continue to meet their legislative requirements.

In Australia, regulatory body ASIC released the ‘Guidelines for meeting upcoming AGM and financial reporting requirements’, which highlights the options available to organisations required to hold an annual AGM in the wake of social distancing recommendations and restrictions on large gatherings of 100 people or more. However, with the situation constantly evolving around COVID-19, Treasurer Josh Frydenberg announced on Sunday 22 March that as a result of these health-related restrictions being put in place to reduce the impact of the virus, it will not be possible for many companies to comply with their obligations under the Corporations Act, particularly when it comes to holding general meetings in person. A temporary 6 month power will be provided to the treasurer to deal with these situations as they arise, which would allow companies an extension to deal with these types of obligations.

An extract from the announcement:

"The impact of the Coronavirus and the health measures in place to limit its spread, in particular social distancing, is giving rise to unprecedented issues for businesses’ ability to comply with the provisions of the Corporations Act. The Australian Securities and Investment Commission (ASIC) has the power to offer relief from some provisions or to take no action for not complying with some provisions…The instrument-making power will apply for six months. Any instrument made under this power will apply for up to six months from the date it is made."

As well as this extension, another practical solution for organisations in this time of uncertainty, is the use of technology to facilitate a hybrid or virtual AGM. Hybrid meetings allow a meeting to be held in a physical location with online facilities, while virtual meetings are conducted solely online.

Link Group’s hybrid and virtual meeting technology stands up to the demands placed on companies by the COVID-19 outbreak, offering a way for companies to connect with their shareholders and maintain regulatory compliance. Shareholders can participate in the meeting, view a live webcast and presentation slides, ask questions and submit votes online, complying with current ASIC requirements for use of this technology. Virtual meetings also help organisations address the increasing demand for investor accessibility, pre and post COVID-19.

While the adoption of this technology has been an area of debate in recent years, some of Link Group’s largest member organisations and listed clients have embraced the platform with positive results. The number of hybrid AGMs Link Group facilitated in 2019 rose by 22% to a record number of online participants, the A2 Milk AGM for example, saw a record 528 attendees log into the online portal.

Partnering with our clients to continue to offer a premium service in this uncertain time remains our focus. Link Group will continue to work with our clients to ensure that all of their 2020 obligations are met in line with evolving health and safety requirements stemming from COVID-19. If you would like to learn more about our hybrid and virtual meeting technology, please contact your CRM or email newbusiness@linkmarketservices.com.au