Calling a meeting is the act of announcing that it will take place and inviting the relevant parties to attend. The proper procedure for calling a meeting depends on two main factors:
- The company’s articles of association.
- The law in the country in which the company is based.
Although the rules in the articles of association cannot contradict the law in that territory, they can add in extra requirements specific to that business and how it calls both board meetings and general meetings (for shareholders and members).
The act of calling a meeting alerts shareholders or board members to the fact it is happening, allowing them to arrange to attend and to prepare fully before the event. There are also best practices for calling both types of meetings we mentioned above. You’ll learn all about them in this article.
Requirements For Calling A Meeting
Here are examples of the requirements for calling board and general meetings:
|Type of meeting||Requirements for Calling the Meeting|
|Calling a General Meeting||A company’s board can call a general meeting, as can the shareholders. Many businesses have a requirement for regular general meetings and AGMs in their articles, but others hold them on an ad hoc basis. The board must give notice of the meeting. In the UK, the Companies Act 2006 states this should be at least 14 days or 21 days for a public limited company (PLC). In the US, the state sets the minimum notice period, but it can be anything from ten days to 60. The notice needs to include the date, time and location of the meeting. It should detail why the meeting is taking place and what will be discussed on the agenda. You should also adhere to the law and articles in reference to how to serve the notice. This could be by post or electronic means, as per the legal framework in that country and the articles of association.|
|Calling a Board Meeting||If you have set dates for board meetings in your bylaws or articles of association and the directors have all agreed on them, you do not need to give notice. However, you should send out the agenda and board papers in good time to allow the board members to prepare thoroughly. When there are no set dates in the diary, you should give ‘reasonable’ notice. It is in the company’s interests to have all of its directors at a board meeting, so you should consider this when scheduling and providing notice. The notice should set out the date, time and location of the meeting, as well as any relevant information such as whether they can take part using board meeting software, such as iBabs.|
The Role Of The Meeting Chairperson
The meeting chairperson holds a pivotal role in calling the meeting. They must make sure the correct planning takes place to ensure it runs smoothly. This includes ensuring the agenda is ready and that the company informs those eligible to attend in good time and in accordance with the law and the company’s articles.
The Role of the Board Secretary
The board secretary works with the chairperson on arranging the order of business and how it fits into the agenda for the meeting. They should also confirm the bookings for the date, time and location of the meeting, as well as arranging accommodation for any board members who require it.
It is key for the board secretary to send the notice of the meeting in good time and in accordance with the law in that territory and the company’s constitution. They should send out copies of the agenda, previous meeting minutes and the relevant papers for the next meeting.
Procedure for Calling a Meeting
Here is a step-by-step guide to the procedure for calling a meeting:
1. Understand the Purpose of the Meeting
There are a number of reasons to call a meeting. The board of directors may call a general meeting to discuss relevant topics. Shareholders can also request a general meeting from the board. In order to succeed under UK law, those asking for the meeting should represent at least five per cent of the shareholding eligible to vote at general meetings. This varies between countries.
The chair should call board meetings to fit in with the schedule laid out in the company’s constitution.
2. Selecting a Place, Time and Method for the Meeting
Once someone calls a general meeting, the secretary should ensure they find a suitable venue and book a date and time for the meeting. The event should be organised without too much of a delay but bearing in mind the need to give adequate notice.
For board meetings, this planning may take place the previous year. The secretary can plan ahead and propose dates for an entire year so that directors can clear their diaries in preparation.
For both general and board meetings, there should be some thought put into how shareholders and/or directors can take part. Will it be in-person only or can they attend on a conference call, video call or through a board meeting portal?
3. Preparing the Meeting Agenda
The chair and the secretary should meet up and discuss the agenda for the meeting. This includes approving the minutes of the last meeting, following up on any previous business and the new business that needs to be discussed. A tight and well-planned agenda allows the meeting to flow and cover all the necessary topics.
4. Sending the Meeting Notice
The secretary should send out the meeting notice giving at least the minimum notice required by law and the articles. This should go to anyone required or eligible to attend, including shareholders, board members and auditors depending on the type of meeting.
The method of invitation also depends on the company’s articles, but, in general, it is acceptable to send out both written and digital notice of meetings.
The notice should include the location, date and time of the start of the meeting, as well as the relevant information about attending both in person and virtually, as well as how to cast a regular or proxy vote. It should also feature the agenda for the meeting, including any special resolutions to be discussed. For board meetings, you should send out board papers with the minutes of the previous meeting for directors to study.
5. Adjusting the Board Papers
If you are calling a board meeting, you might receive replies from board members querying the previous meeting’s minutes or with suggestions for improving the agenda. After discussion between the chair and the board secretary, you might choose to adjust the papers accordingly.
It’s worth noting that this process is much easier when you use board meeting software than if you send out paper copies. You can simply update the documents in the cloud and it refreshes for all parties. There is no need to reprint vast tomes and mail them out again.
Tips and Best Practices
- Give as much notice as possible out of respect for the attendees. If you want as many people as possible to take part, you need to allow them to change plans, book travel and accommodation and prepare fully for the meeting.
- Try to make the meeting as accessible as possible. In many countries, it is now legally acceptable to hold an AGM in an online-only or online/offline hybrid manner. Board portals make this process simple and effective and it means that those with busy schedules, mobility issues, who live overseas or who would like to attend but can’t for whatever reason can still take part.
- For board meetings, try to schedule a whole year’s dates to ensure you have your directors’ time locked in before their diaries fill up. This gives you the best chance of them being able to attend all of the meetings during that period.
- Be as clear as possible about the purpose of the meeting. Using specific details of the proposed resolution to be discussed allows shareholders to make a better judgement over whether they need to be there. If you are vague, they might change plans and travel across the country for a meeting that is of no interest to them. You want to avoid disgruntled shareholders at all costs.
What is the difference between regular and special notice of the board meeting?
For regular meetings, if your company bylaws allow, the notice you give can merely be a statement that they take place at a certain time on a certain day every month, for example. It is best practice to send notice for every meeting, but not always necessary.
However, for special meetings where there may be urgent discussions that can’t wait for the next regular meeting, proposals to change the company regulations, or something else important, you have to give individual notice. In addition, you should always send the full agenda and there can be no discussion of any other topic during that meeting. For a regular meeting, you can send a less structured version of the agenda and it is possible to stray from it if needed.
Who can call an Extraordinary General Meeting (EGM)?
An EGM can be called by the directors of a company, holders of shares worth at least ten per cent of voting shares or a tribunal. These are held to deal with urgent matters such as removing executives or other legal matters that concern the business.
Who can call an Annual General Meeting (AGM)?
Only the board can call the AGM. It usually happens on a set day every year, but the board can call an Annual General Meeting on a different date with 14 days’ notice.
The procedure for calling a meeting depends on the different types of meetings, but the principles remain the same. Stick with the guidelines in the constitution and the laws of the land, avoid short notice as much as possible and let people know what will be discussed. The best and most productive meetings involve as many stakeholders as possible, so giving everyone the chance to make arrangements and research the matters at hand helps immensely. Using a meeting portal like iBabs helps things run smoothly and allows those who can’t travel to still play their part.