What should I do about my AGM in the midst of COVID-19?

Q. My constitution, and my state Associations Incorporation Act, say that I must hold an annual general meeting (AGM) this month. This would seem to go against Coronavirus (COVID-19) precautions. What should we do?

A: Don’t hold an in-person general meeting. Simple. Straightforward. If your laws and constitutions and rules say something different, point out to them that human life is paramount.

The Australian Charities and Not-for-Profits Commission (ACNC) advises that it will not take action against a charity that does not hold an AGM due to social distancing requirements, but says “you may need to contact your state or territory regulator for further guidance”.

The Australian Security and Investments Commission, which regulates the corporate sphere – and has some jurisdiction over not-for-profits registered as companies – has taken a similar line in regard to the Corporations Act with a “no actions position” on non-compliance.

Some states have come part of the way to meet the problem. Victoria, for example, will allow you to put your usual meeting date off for an extra three months (though the regulator is asking that you seek permission first):

“Incorporated associations can apply for an extension of time to hold an annual general meeting (AGM). The Registrar is currently granting three-month extensions and waiving the usual fee. To seek an extension, complete our Extension of time to hold an AGM or lodge financial statements form (Word.doc) and send it to: [email protected].”

Queensland advises:

Normal practice is that an individual association must apply to OFT, outlining the special circumstances as to why the extension should be granted. However, in the current circumstances, we will allow a grace period of a further 6 months to hold your AGM, if required, without the need for you to make a written application.

No other states had posted extensions at time of writing (March 30, 2020), but it seems likely that they will follow suit. You can double-check with your regulator via the links posted on the ACNC site.

We recommend you take any extension that’s on offer. If your state hasn’t come to the party yet, though, or if you run out of extensions, don’t hold an in-person general meeting.

Telling people to break (or at least bend) the law (if absolutely necessary) is obviously something that Our Community doesn’t do lightly. If it makes you feel any better, this is more akin to what lawyers refer to as “conflict of laws”, where two legal instructions contradict each other, and (assuming that (a) you’re acting in good faith and not trying to pull a fast one and (b) no large property transactions are involved) we consider it highly unlikely that any agency is going to come along afterwards and second-guess your decision to put health considerations first.

Q. How about an electronic meeting?

A. If there are no extensions on offer in your state, and/or you feel you really need to hold an AGM soon, electronic options are your only options right now.

It’s possible that your governing document (constitution) may be silent on whether you can hold meetings electronically; or may even prohibit them. If so, tread carefully. Only hold a meeting if you really need to, bearing in mind that decisions you make may be liable to challenge.

Q. How do I go about organising an online meeting?

A. You should plan your meeting carefully. Don’t hit ‘send’ until you have all the fundamentals in place. Here’s what you should do.

Create a timeline

You need to allow enough time for people to not only get notice that an AGM is going to be held, but to consider any decisions that need to be made and get their votes in (by mail if necessary). Factor in time for at least one reminder notice.

Build your agenda carefully

Keep decisions to an absolute minimum. Avoid special business. If you must have special business, call for proxies on that, noting that any special business will have to be passed by a two-thirds super-majority. Include enough background information in your meeting papers to ensure people who can’t tune in to the meeting have enough information to make a decision.

Send your members the following

Do this electronically for those who’ve agreed to it, and through the post for everyone else:

• Your annual report
• A message from the chair about when and how you will hold an AGM, and why this mode of meeting has been chosen. Offer up a phone number (preferably the Chair’s) for people to call if they have concerns/queries. Be clear about timelines.
• Voting papers, and clear instructions on to where and by when they need to be returned.

Q. What tools can I use to hold the meeting?

A. If you do decide to proceed with an online meeting, there are a number of useful software tools that may be used depending on circumstances, preferences, budgets, and your organisation’s existing systems.

Free tools such as Zoom and Skype may be used for video conferencing between up to 100 individuals and 50 individuals, respectively. (Please note that the free version of Zoom is limited to 40-minute meetings; this limit can be overcome by purchasing a subscription, but you may prefer just to hurry through the business).

Tools such as Slack and Microsoft Teams may be used for instant text communication, as well as video and voice calling. Text communication may be preferable under circumstances where a robust internet connection is not present, or where video or voice communication among a large number of participants is problematic. Text communication may also be preferable for record-keeping purposes.

For larger groups and more control over participation, as well as more record-keeping, chat recording and data collection tools, GoToWebinar is a good option. It isn’t cheap ($109 per month for up to 100 participants or $249 per month for up to 500 participants) but it enables participants to raise their (virtual) hands, ask questions, speak to particular topics, and more. There’s a free seven-day trial for evaluation purposes, and if you’re only holding one meeting that should be enough.

GoToWebinar also has the ability to record webinars, providing an additional record of the AGM. A GoToWebinar session typically has one organiser, plus panellists, and participants. For the purposes of an AGM, these can be thought of as a secretary/chair, board members, and members, respectively.

Participation in all of these listed options can be achieved with a smartphone, as well as by using a computer.

Q. What about people who don’t have internet access?

A. If your membership is not online or really isn’t technology literate, you may offer the alternative of proxy voting by mail. Make sure you allow a decent amount of time for people to receive their papers and respond to them.

Q. Anything else I need to know?

A. As mentioned above, we think there’s zero chance that regulators are going to come down heavily on those who put the health of their members first by delaying an AGM or shifting it online, so long as you’re acting in good faith.

That said, we recommend you cover your backside by keeping meticulous notes about what you decided to do, and how you came to that decision (keep a record of the executive’s deliberations, your notices to members, and any attempts to contact your regulator, for example).

If you do hold an electronic AGM, keep meticulous records of that as well. Circulate the minutes to all members as soon as possible after the meeting, to give them the chance to amend the record and be prepared to ratify any decisions at a properly constituted AGM sometime in the future.

The takeaway, though, is that safety trumps regulation. The rules were made for different times. Right now, do what’s safe and what’s right; worry (or, even better, don’t worry) about the rules later.