FRC publishes guidance on running effective AGMs

News types: Codes and Standards Announcements, Generic Announcement, Guidance

Published: 21 July 2022

The Financial Reporting Council (FRC) has today released new guidance for listed companies to enhance effective shareholder participation when planning and conducting AGMs. This is the first time the FRC has published specific guidance on the topic.

With input from a wide range of stakeholders, the guidance gives practical advice to help companies ensure that their AGMs are well-run constructive forums for effective engagement. It covers key aspects such as board engagement with shareholders, communication of meeting arrangements, using proxies, and voting processes.

Historically, general meetings have been held in physical venues, however, since the start of the COVID-19 pandemic, many companies have now moved to a hybrid form of meeting using electronic platforms. The new guidance sets out actions to assist companies in making the most of new technologies to increase shareholder engagement.

Recognising that all companies are different, the guidance offers flexibility. Some companies have a small number of shareholders while others have many thousands in multiple jurisdictions, and companies will need to take different approaches and use different technologies and methods depending on their circumstances.

Sir Jon Thompson, CEO of the FRC, Said:

“With this new guidance, we want to encourage companies to seize the opportunity to maximise shareholder engagement by embracing new technologies.

“We also recognise that there are many benefits of physical meetings, allowing for more effective in-person dialogue, so companies should think carefully about which approach is right for them and their shareholders.”

Richard Stone, CEO of the Association of Investment Companies (AIC), said:

“Getting shareholders more closely engaged with their investment companies is one of our members’ top priorities, and AGMs are an important opportunity to do that. This guidance is helpful and timely, offering practical advice about how to make meetings work better for shareholders in a post-Covid world, whether they are attending virtually or in person.”

Peter Swabey, Policy & Research Director at The Chartered Governance Institute UK & Ireland, said:

" I am delighted to see the publication of this useful guidance from the FRC. The AGM has always been, and remains, a fundamental element of corporate governance and both the march of technology and the pandemic have seen us look at delivery of the AGM in new ways. It is very helpful for the FRC to have captured the views of so many constituencies on the ways in which the AGM can deliver most governance value.”  

The full guidance is available here.