The company belong to its shareholders.
This year the Financial Reporting Council UK (FRC) released a guidance for listed companies to enhance effective shareholder participation when planning and conducting general meetings of shareholders (GM) - https://www.frc.org.uk/getattachment/3501347c-2394-4ec4-94c8-9cd62b62d1fe/FRC-Good-Practice-Guidance-for-Company-Meetings_July_2022.pdf.
The guidance gives practical advice to help listed companies ensure that GMs are well-run constructive forums for effective shareholders’ engagement.
The seven principles listed by FRC are summarized below
A. Before the GM
1. Information disseminated prior to the general meeting must offer clear instructions on how to attend the meeting and vote, to enable effective shareholder engagement.
2. Whether meetings are physical, hybrid or virtual (if allowed under legal terms), shareholders should, as far as practicable, be offered all conditions to engage in the business of the meeting.
B. During the GM
3. The board should provide an update at the GM on matters raised by stakeholder groups (not only shareholders) that are considered to materially affect the company’s strategy, performance, and culture.
4. Companies should seek the broadest access to and participation in GMs by a diverse range of shareholders. Whether attending virtually or in person, shareholders should have the opportunity to raise questions pertinent to the meeting agenda.
5. Shareholders should be able to cast their vote in real-time, or submit a voting instruction in advance via the appointment of a proxy, depending on the format of a meeting. Appropriate technology should be used by companies to ensure that shareholders can appoint proxies and send instructions to proxies prior to the meeting.
C. After the GM
6. Companies should be as transparent as possible with shareholders in relation to matters discussed and raised by shareholders at the GM. For instance where the meeting is recorded, that recording may be made available to shareholders for a defined period after the meeting. If the recording is made available via a website, shareholders should be notified in advance that it will be placed there after the meeting takes place.
D. Shareholders’ engagement during the year
7. Effective and transparent shareholder engagement should not be limited to an annual event. Opportunities to update shareholders on company matters should be offered throughout the year, with an emphasis on ensuring all shareholders have access to similar information.
This is the first time the FRC has published specific guidance on the topic and the implementation of the principles is welcomed for all companies listed in the index of local stock exchanges.