ISLAMABAD: In light of the threat posed by the evolving COVID-19 situation (Coronavirus) and protect well being of shareholders, the Securities and Exchange Commission of Pakistan (SECP) on Wednesday advised all companies to modify their usual planning for annual general meetings and the board meetings to be held through tele/video conferencing.

The regulator has recommended all companies to consider and evaluate the risks in the present situation. Every company, is required to hold an annual general meeting (AGM) within sixteen months from the date of its incorporation and thereafter once in every calendar year within a period of 120 days following the close of its financial year.

As AGM season for December end companies is approaching, the directors and secretaries should modify their usual planning for their company’s meeting in light of the threat posed by the evolving Covid-19 situation.

Directors should consider if members can consolidate their attendance and voting at AGMs into as few people as possible through proxies, while honouring quorum provisions.

In order to avoid large gathering at one place, the companies may consider provision of video link facilities at different locations considering the geographical dispersal of its members.

The SECP has also floated the standard operating procedures (SOPs) regarding the AGMs issued by health experts which includes considering basic protective measures during the meeting including facility of cleaning hand with sanitizers or soap and water.

The SECP has said that for safety of members, seating arrangement shall be made at appropriate distance and voting through postal ballot may also be considered by chairman of meeting or by members present in person or through video-link or by proxy having not less than one-tenth of the total voting power by demanding poll for resolutions.

“This is safer option in current situation,” the SECP advisery added.

It explained that members of a private company or a public unlisted company having not more than 50 members, may pass a resolution ordinary or special by circulation signed by all the members for the time being entitled to receive notice of a meeting, except for the ordinary businesses specified under sub-section (2) of section 134 of the Companies Act, 2017 to be conducted in the AGM.

The directors may hold their board meetings through tele or video link provided that the minutes of such meeting are approved and signed subsequently by all the directors.

Published in Dawn, March 12th, 2020