Annual general meetings (AGMs) have been given the green light to go online through the Corporate Insolvency and Governance Act 2020 which passed at the end of June 2020. In addition to enacting new regulations around the filing of documents (with the levels of corporate documentation that require filing at Companies House increased, as well as the duration of time a company has to file them for), the Corporate Insolvency and Governance Act 2020 introduced some big changes for the calling and hosting of meetings.
For companies looking to delay their AGMs until large gatherings are back on the menu, the good news is that the new law extends the required period in which to hold them until 30th September. For those who choose not to delay, there was good news too: meetings now no longer have to be held in a particular place, allowing AGMs to be held virtually and votes cast electronically.
Benefits of virtual AGMs
The first impact being able to hold a virtual AGM will have on a company is cost. Now that we’re no longer having to factor in the hiring of a meeting place, catering and employee travel costs around an AGM will massively decrease, which is perhaps the biggest benefit of virtual AGMs.
Another advantage is the ability to include everyone. If meetings can be attended virtually and votes cast electronically, people the length and breadth of the country (not to mention leaseholders overseas) can all attend. Moreover, if meetings are attended online rather than in-person, levels of small talk are likely to be cut down, drastically increasing efficiency and meaning fewer people have that dreaded ‘oh no another meeting’ feeling.
Potential pitfalls of virtual AGMs
But it’s not all plain sailing. Some suggest that taking AGMs and other meetings online may exclude some leaseholders who are not adept in technology at all. So block managers should consider offering a dial-in option so that those without the required technology can still participate in the meeting. Most dial-in methods would mute the caller so to allow for a two-way conversation, collecting questions before and during the meeting is key. Detailed agendas being sent out in advance with an agreed order of questions is one way to make sure that the virtual AGM is as inclusive and productive as an in-person AGM.
It's all about the technology
Of course, the main issue with virtual AGMs will be the technology. Within the property, industry, management companies and block managers who choose to use them will need to ensure that they have factored in a way to remind leaseholders to log in at the appropriate time to ensure they do not miss the meeting, while all technology will have to be tested beforehand. Currently, cross-industry complaints about virtual meetings revolve around the connectivity of meeting tools like Microsoft Teams, Zoom and others, with meetings delayed and truncated by the inability of participants to log in.
While there are still kinks to be worked out of the system, the Corporate Insolvency and Governance Act 2020 does at least afford companies the ability to choose whether they’re going to delay their AGM or not. Virtual AGMs gives those block management companies who do decide to go ahead a workable solution to the need to vote on decisions relating to properties at large. For more information on hosting virtual AGMs or delaying in-person AGMs, IRPM members can view this video where the CEO of the Institute of Residential Property Management (IRPM), Andrew Bulmer and Cassandra Zanelli, Partner at PM Legal Services, broke the topic down to its nuts and bolts. Prospective members can find out more about joining IRPM here.