Your Guide to Hybrid and Online AGMs

While annual general meetings (AGM) until recently used to be associated with in-person attendance, the recent global crisis has moved AGMs to the digital environment. What exactly are online AGMs? And how do they compare to in-person shareholder meetings?

At a glance:

• What are Online AGMs?
• The Benefits of Shifting to Online AGMs
• Organizing Online and/or Hybrid AGMs
• How was the Adoption of Online and Hybrid AGMs?

What Are Online AGMs?

An annual general meeting (or annual shareholder meeting) is an often mandatory yearly meeting of a company’s shareholders. During the meeting, shareholders vote on key company operations (e.g., board appointments, compensation, dividends), participate in discussions, and ask questions.

During the meeting, directors give a rundown of all critical company-related information, such as annual company performance, goals, and strategy.

A online AGM, also known as virtual AGM is the equivalent of an in-person shareholder meeting. The only difference is the format of the meeting — companies hold AGMs entirely online. All the discussions, elections, resolutions, and questions are conducted virtually and through the internet.

Virtual and online meetings let shareholders actively take part in annual general meetings, giving them the same set of privileges and transparency as in-person AGMs. The structure of the online AGM, as well as tasks on the agenda, also remains unchanged. Companies should record their virtual annual general meetings as they are legal proceedings.

Consequently, shareholder meetings can also be performed in a related online AGM hybrid format, where participants have the option to attend either in a physical location or remotely. A hybrid AGM is an AGM format that promotes accessibility to shareholders from different demographics. This type also allows companies and organizations to practice shareholder engagement and meeting rights, much like entirely physical and online AGMs.

To put it simply, online AGMs are shareholder meetings that are held completely virtual — no venue, no physical contact. Hybrid AGMs have both the physical and virtual aspects in annual general meetings — participants can attend on-site or online.

Online and hybrid AGMs are categorized as electronic annual general meetings. eAGMs are general meetings that utilize any electronic means of communication. This could be in the form of video conferencing apps or online AGM platforms, such as ConveneAGM.

What are the benefits of shifting to Online AGMs?

With the rise of advancements in executing AGMs, what benefits can companies and organizations expect with the switch to online annual general meetings?

Online and Hybrid AGMs Are Secured

The stereotype with online platforms is that anything put up digitally is vulnerable to attacks and intrusion. That is not the case for most eAGM platforms like ConveneAGM. Remote technologies used for conducting virtual meetings must provide high-level security for attendees, including a secure network connection.

Because the main objective during AGMs is voting on critical company decisions, online AGM platforms employ robust security measures. Strict authentication and access control rules keep unauthorized third parties from obtaining access to sensitive data and interfering with proceedings. Online and hybrid AGMs are monitored throughout to prevent security breaches during the meeting.

As an added security measure, companies hosting online AGMs also have contingency plans. Provisions should be made in case of a power outage or internet connection drop to ensure uninterrupted reception.

Online Shareholder Meetings Can Help Save Money

Hosting online shareholder meeting reduces much of the spending observed in physical meetings. In an in-person AGM, logistical hassles incur expenses such as renting a venue and food catering. Adopting a virtual AGM can help in lessening the costs, as there will be no extra effort in looking for large places to conduct online and hybrid AGMs.

Similarly, companies would not require several registration desks as meeting attendees can register through QR code scanning from their mobile devices, making it contactless — minimized costs in sanitation as well. This goes the same with voting in online or hybrid AGMs. By casting votes through the participants’ mobile devices, there will be reduced expenses in purchasing e-voting devices, printing voting slips, and distributing documents.

With online AGMs, travel and accommodation costs will be lessened as shareholders can take part actively without leaving their homes. Businesses subscribing to reducing company carbon footprint can benefit from holding online and hybrid AGMs.

Online AGMs Promote Shareholder Engagement

Physical AGMs, prior to the pandemic situation, made it hard for some shareholders to attend and participate in the physical venue. Some participants cannot travel for that certain time, and some feel intimidated to steer the discussion by asking questions in physical meetings.

Poor attendance and engagement during online AGMs are two of the biggest adoption fears for a virtual shareholder meeting. However, with the General Motor’s Corp.’s virtual annual shareholder meeting, attendance actually improved. The number of attendees rose by almost a hundred, from 35 to 125, after the company adopted the digital format.

While some shareholders still oppose online-only AGMs, there’s a growing need for this solution. Online AGMs cut travel and accommodation costs as well as the time necessary to organize and attend the meeting — obstacles that often contribute to poor AGM attendance.

With features that allow participants to ask questions without broadcast delay, eAGMs can ensure increased engagement of shareholders. Furthermore, live voting can aid in elevating the transparency of shareholders as results are instantly tabulated.

Virtual Annual General Meetings Help Companies Adapt to Rapid Changes

In times of crisis where global travel restrictions are enforced, virtual annual meetings are a safe alternative to in-person meetings. For companies that want to maintain operations, online AGMs might become the new normal. Hybrid AGMs can aid in seamlessly transitioning the company’s general meeting proceedings from entirely physical to virtual.

However, organizations have to perform an in-depth analysis of which type of meeting will help them achieve goals safely and effectively. The decision between meeting formats depends on the complexity of the agenda and the number of attendees eligible to vote.

How to conduct online/virtual and hybrid AGMs?

Moving from physical AGMs to virtual AGMs can incur challenges if not handled properly. Here are some things to consider in organizing and running an electronic annual general meeting.

Review Legal Compliance of Online AGMs

While an increasing number of countries recognize the necessity for virtual annual shareholder meetings, this meeting format isn’t compliant everywhere. It’s therefore critical to review statutory requirements prior to organizing a online AGM meeting to ensure the permission of virtual format. Companies adopting hybrid or virtual AGMs must adhere to guidelines to help them transition from physical to alternative meeting structures.

There’s also the matter of company bylaws that specify the acceptable formats for shareholder meetings. There are specific areas that do not allow online AGMs, thus the company should amend bylaws to include virtual shareholder meetings.

Choose the Right Online AGM Platform

Evaluating online platforms in conducting your organization’s AGM includes factors you should consider to select the most suitable solution. Apart from the adherence of the software to the regulations, other factors in choosing the best solution include:

• Software Features
  In picking the right AGM platform, you should assess the appropriate set of features. Look for solutions that emulate the universal proceedings of an annual general meeting. Virtual AGM solution features such as live voting, intuitive Q&A, and activity reports should be present in the software to ensure increased transparency and accountability.
• Security
  The best online and virtual AGM solutions prioritize the security of the meeting. Seek solution providers that have solid security features that can prevent unauthorized access and breaches. These features include multi-factor authentication, user access and permission, and secured cloud storage.
• Accessibility and Support
  The AGM software must be intuitive and convenient to use for the meeting participants. Look for online platforms that are compatible with devices without sacrificing functionality. Moreover, technical support must be readily available for all attendees — physical or virtual — to resolve issues promptly.
• Cost
  A major determiner in choosing the right platform is usually the price of the software. While the features and meeting capacity account for the cost, consider looking for vendors that provide tailored solutions to align with your needs.

The technology employed to hold a virtual shareholder meeting should facilitate shareholder participation. At the same time, it should be evaluated yearly to check if the solution fulfills the meeting goals and if it does so in line with established processes.

Consider Technical Factors

The online AGM platform will only execute the virtual AGMs successfully if the hardware is installed properly. First, you must consider investing in a fast, stable, and reliable bandwidth. A fast internet connection will help ensure that there are no delays in the webcast of the annual general meeting — resulting in the elevated engagement of the shareholders.

In addition, make sure that all the technical pieces of equipment are working. This will prevent technical issues during the actual meeting. Conduct dry-runs of the meeting to ensure that there are no obstacles in the technical aspect.

Prepare Before the Meeting

Before executing your online or hybrid AGM, preparation is a must. This is to ensure that everything will be under control during the actual AGM. One thing that is crucial in preparation is the AGM agenda.

A clear and well-developed agenda must be distributed across the meeting participants beforehand. This helps attendees in familiarizing themselves with the documents and meeting flow. This will also allow them to prepare their questions for the board. Online AGM platforms must be equipped with this feature for easier preparation and circulation.

Furthermore, online AGM solutions must have the capability to allow organizations to conduct a run-through of the annual general meeting proceedings prior to the actual day of the AGM. Check the presentation slides, meeting speakers, and technical equipment to lessen the risk of issues.

Ensure Shareholder Engagement and Accountability

A online/virtual AGM allows shareholders to bring up more difficult matters through anonymous questions, as opposed to a traditional meeting. With fewer obstacles to attending the meeting (no travel or accommodation expenses), more shareholders might find it easier to actively participate. The features of using an online AGM solution especially for hybrid AGMs also provide avenues to increase shareholder engagement.

During the online or hybrid AGM proceedings, companies must ensure that all meeting participants, whether online or on-site, can exercise their rights to partake in the discussion, vote, and ask questions. ConveneAGM supports live voting and live Q&A that are conducted in real-time broadcast without delays, ensuring that everyone’s concerns are addressed.

Discover how you can improve shareholder engagement through virtual meetings.

Are you ready to make the switch to hybrid or online AGMs?

Given the newness of the format, many companies are understandably apprehensive about holding a online AGM for the first time. Therefore, it is crucial that companies find a dependable online/virtual AGM platform that will take care of any misconceptions they might have about the virtual format. The truth is, with the right tools and preparation, companies can easily hold virtual shareholder meetings with success.

With all these in mind, our team built ConveneAGM — a powerful platform designed to provide companies and shareholders with a seamless and highly secured AGM experience. Embrace the change and experience the pros of online AGM solutions. Contact us to get started.