WRITTEN BY Riley Berry
Annual General Meetings, or AGMs, are a fundamental part of running a business. As we come to the close of this AGM season, companies should take this opportunity to take stock of what went well and what didn’t, and to reflect on the value that an effective AGM might be able to add to your business beyond merely ticking boxes.
Although it’s easy to get caught up in the day-to-day running of your business, especially around the end of the financial year, neglecting AGM planning and scrambling to get organised often leads to things being rushed and opportunities being missed. Rather, AGM planning should be a year-round process to give your business the best opportunity to reflect on its experiences, review its progress, revise its core documents, and keep members engaged. There are a few key milestones that should appear on your AGM planning timeline to avoid last-minute planning and to ensure you get the most out of your AGM.
You should begin planning for your next AGM as soon as you finish the previous one. For example, the agenda should always be informed by the experience of the previous year. It is worthwhile to have the Secretary record on the agenda any warnings or notes for the future throughout the meeting. Together with the minutes, this record will ensure that the next agenda can be shaped to ensure efficiency, avoid known issues, address ongoing matters and follow up on anything that was missed or that needs to be revisited.
Another key planning priority should be constitutional review. Amending the constitution at an AGM must be done by special resolution, which has to be proposed in the AGM notice issued several weeks before the meeting itself. However, by the time a company starts digging into its constitution in the lead-up to an AGM—and incidentally discovering defects or room for improvement—it is often too late to do anything about it until the next year’s meeting. As such, we recommend making constitutional review a fixed feature of your strategic planning, several months in advance of your AGM.
For the most part, nothing will need to change. However, by making this a regular part of your governance activities and giving yourself plenty of time to seek feedback from directors, members and professional advisors, any necessary amendments can be proposed with comfortable notice and in a form that is likely to be successfully passed.
Members or their proxies present at the meeting have the right to ask questions on any item of business. However, it may be worthwhile getting out there earlier to seek out their questions or concerns. In the documentation sent to members including the official notice of the meeting, or even earlier, companies should invite members to submit written questions to the board in advance of the AGM. This gives you an opportunity to reflect and to do your research, and to ensure that you aren’t caught by surprise at the meeting. That way, you can keep members engaged and can incorporate any questions or concerns in the formal addresses delivered at the meeting.
If you have questions about what is required of your company in running an AGM or would like assistance with your planning, please get in touch with our Business & Commercial team.
Written by Riley Berry with the assistance of Bryce Robinson.