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The Financial Reporting Council (FRC) has published a review titled '', analysing a sample of 202 AGMs held between March and August 2020 to explore the different ways that FTSE 350 companies conducted their 2020 AGMs following the disruption caused by the coronavirus (COVID-19) pandemic. Highlights include:

• 80.7% of companies held closed meetings, requiring voting in advance via proxy

• 81.6% of the 163 companies that held closed meetings made some arrangements to allow for shareholder Q&As with the board

• 60% of the 30 companies that held open meetings used webinar or audiocast functionality with live voting capabilities

• 30 companies 'appear to have not made any arrangements for shareholders to ask questions to the board prior to or during the AGM'

The FRC concluded that while the best organised and executed virtual and hybrid meetings enabled increased participation from shareholders, companies that held closed meetings in which retail shareholders were unable to participate or vote on the day of the AGM disenfranchised those shareholders, and recommended that 'all efforts should be made to ensure shareholders should have the ability to vote following presentations from the board'.

In the review, the FRC identified enabling shareholders to submit questions to a dedicated website or email address or use mail, allowing sufficient time for shareholders to submit questions and posting all Q&As on the company website following the AGM as examples of good practice. Examples of bad practice included capping the number of characters allowed in submitted questions, only allowing mailed-in questions in advance (not email), unrealistic time frames for submitting questions and choosing not to respond to all questions.

The FRC have outlined plans to work with the Department of Business, Energy & Industrial Strategy (BEIS) to consider as soon as possible what measures may need to be brought forward to ensure AGMs are able to take place virtually or as a hybrid during 2021. The FRC will also convene a stakeholder group comprising of government, companies and investors to consider recommendations for legislative change and propose alternative means to achieve flexibility, while maintaining the integrity of the AGM. 

For more on this topic, see our trend report: COVID-19 impact on the AGMs of FTSE 350 and AIM 50 companies