DATED: 2 APRIL 2020
With businesses having to adapt to the unprecedented challenges of coronavirus, one growing consideration for companies is whether, and if so how, virtual meetings amongst directors and shareholders can be used as an alternative forum to physical meetings.
The Companies Act 2006 allows virtual meetings provided that all persons attending by electronic means can participate effectively and vote as required.
However, whether or not your company can use this depends on your articles of association, which have to be followed. Please see below a Flow Chart which will help you decide if you can hold meetings remotely:
As a Director or Shareholder if you are in any doubt as to the interpretation of a company’s articles in regard to convening a virtual meeting then please do contact Caroline Armitage or one of the Corporate and Commercial team who would be happy to advise.
Do not forget even for virtual meetings the usual requirements with regard to notice, quorum, distribution of documents and voting remain applicable.
In light of the current circumstances the Chartered Governance Institute has issued guidance on good practice for those companies seeking to hold virtual board meetings or shareholders meetings.
It is clear that during these difficult times businesses will need to adapt to managing the company virtually, and in doing so will need to ensure that structurally and practically they are in a position to do so.
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