With many organisations still operating under pandemic conditions that include heavy restrictions on face-to-face gatherings, the new laws will allow the use of fully virtual and hybrid meetings for holding an AGM by extending temporary relief measures until 31 March 2022.
The changes also allow the sending of meeting related materials to shareholders electronically, and the electronic execution of deeds and other company documents.
The measures had been due to expire next month, just before this year’s AGM season, leaving thousands of large and small companies and not-for-profit organisations in limbo.
This milestone follows a major advocacy campaign by Governance Institute of Australia.
Governance Institute of Australia CEO Megan Motto said the new laws will bring welcome relief for so many organisations navigating the fast-approaching AGM season.
“This is such an important step because it brings some certainty during such an unpredictable time for business,” Ms Motto said.
“This is the number one issue for so many of our members who have been operating with a high degree of uncertainty while awaiting an update on this issue. Governance Institute is so pleased to have been able to advocate to secure this resolution.
“We thank all sides of Parliament for their work on this important Bill.”
The latest changes also:
- give ASIC powers to grant temporary class order relief to entities from the requirement to hold AGMs at a physical location (when their constitutions do not allow virtual or hybrid meetings) and to give AGM-related documents to shareholders in hard copy in special circumstances – such as the current COVID-19 outbreak.
- introduce a fault element for civil penalty proceedings commenced against directors and companies for alleged continuous disclosure breaches.
Ms Motto said while the passing of the Bill is a major step forward, a permanent resolution on the issue is still the end goal.
“All eyes now turn to a piece of separate legislation that has been proposed by the Government that would permanently allow virtual meetings, electronic document execution and electronic shareholder communication.
“Governance Institute will be watching this next step - in what has become a very long process - closely.”
Source: The Governance Institute