How can a company hold meetings during COVID-19?

Although the COVID-19 pandemic has forced virtual and remote working on all corporate and professional industries, companies can still hold proper meetings during the pandemic and its aftermath. As a result of the COVID-19 pandemic, the Federal government introduced measures (pursuant to the Corporations (Coronavirus Economic Response) Determination (No. 1) 2020 (Determination) which enables companies to conduct meetings, including their Annual General Meetings (AGMs) electronically. The operation of the Determination is current and has been extended for a further six (6) months until 21 March 2021.

These measures (very broadly) permit steps that are required (or often are required) to be taken in holding meetings – including providing notice of, holding, and voting at, meetings to be conducted by electronic means (for instance, using Zoom). This makes meetings, and particularly,  AGMs, convenient for companies, provided the steps required to comply with the Determination are complied with.

Under the Determination, a company is permitted to hold an electronic meeting providing that:

1. members are able to participate equivalent to the opportunity they would have had to participate if the member were attending in person;
2. voting must be by poll (not show of hands);
3. the use of the technology must be clearly explained to members prior to the meeting; and
4. backup measures in case of technology issues must be in place.

Although the new measures will mainly benefit large (often public) companies, the Determination also assists private companies with many members and/or where members are geographically distant.

Companies who find the use of the procedure permitted under the Determination simple and beneficial may wish to consider putting into place mechanisms that permit a similar virtual meeting procedure to be used when the operation of the Determination expires. This will require (in most cases) amendments to the governing documents (the constitution) of the company to permit meetings to take place in this manner.

Key Points:

1. Meetings may be held electronically until 21 March 2021;
2. For an effective meeting to occur, there needs to be member participation, voting by poll, and clear instructions (and a backup plan) for the technology in use; and
3. The measures have been extended until 21 March 2021, after which the usual meeting procedures that are set down in the constitution or by the Corporations Act 2001 must be complied with. If you wish to continue to conduct meetings virtually, your constitution must either permit it or be amended to do so.