Covid causing a headache for firms as they plan for AGMs

THE Institute of Directors (IoD) in Ireland is urging the Government to urgently address the many issues now facing companies when complying with the requirement to hold AGMs during the current crisis.

These issues include the challenges facing companies in holding physical AGMs whilst still complying with COVID-19 health and safety restrictions; the ability to hold virtual AGMs; and the need to ensure shareholder involvement in these meetings.

AGMs are essential for many companies in terms of meeting their governance responsibilities, as well as complying with the regulations under Company Law.

Holding an AGM provides accountability to shareholders and allows for the approval of the annual accounts in addition to meeting other requirements.

IoD CEO Maura Quinn said time is running out for many companies to meet the legal requirements to hold an AGM.

“There is a growing and added sense of urgency about this matter as, for many companies who have already postponed their AGMs, the clock is ticking down. Business leaders want to continue to run their businesses meeting their legal and fiduciary duties, but the current crisis has created a particular issue around the physical holding of AGMs for many and for those who cannot under their own constitution have a virtual AGM,” said Ms Quinn.

“We need a provisional solution to this during the current crisis from the Government and the Department of Business and Enterprise under whose aegis this falls. We believe it is appropriate to make virtual AGMs acceptable across the board for an initial period, possibly until the end of the year, at least, and their decisions and motions should be legally binding and effective, where applicable,” Ms Quinn added.

“Many companies cannot amend their Constitutions to provide for virtual AGMs without holding a physical AGM or EGM in the first instance.”

Iod CEO Maura Quinn