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Having Your Say – Votes at General Meetings Explained

Posted by Corplaw on Aug 13, 2015 9:15:00 AM

Having Your Say – Votes at General Meetings Explained

An annual general meeting (AGM) is a meeting of members of a company at which the members can put questions to the directors and receive information pertaining to the company regarding its financial statements, appointment of auditors and changes in the board of directors. A company must hold an AGM every calendar year. The length of time between one AGM and the next cannot be more than 15 months.

Notice

The board of directors in normal circumstances will call an AGM and ask for the company secretary to send written notice to all of the members. The Companies Act 2014 provides that at least 21 clear days notice of the AGM must be given, a shorter notice period can be called if all members are in agreement. The notice will specify the place, date and time of the meeting, as well as the nature of business to be transacted.

Quorums

No business may be transacted at general meetings unless there is a quorum of members present; in the case of a single-member company, one member of the company present in person or by proxy constitutes a quorum present. For multi-member companies the Companies Act 2014 provides that 2 members present in person or by proxy at a general meeting will be a quorum unless the company’s constitution has specific provisions stating otherwise.

Proxy Forms

The notice of the meeting will state that members entitled to attend and vote at the meeting can appoint a proxy; a proxy will attend, speak, and vote at the meeting on the member’s behalf. The statement will also include the timeframe before the meeting in which the proxy form must be delivered to the companies registered office; this is 48 hours unless the company’s articles specify otherwise.

Voting – Show Of Hands / Poll

Votes at general meetings can either be transacted by voting through a show of hands or by deed poll. When voting by show of hands every member present in person and every proxy has one vote so that no individual member will have more than one vote. When voting by poll, every member present in person or by proxy will have either one vote for each share they hold, or one vote for each €15 of stock they hold. These provisions are subject to the company’s constitution providing otherwise.

At a meeting a poll can be demanded before, or on the result of the show of hands vote. The demand for a poll can be made by the chairperson of the meeting; at least 3 members present in person or by proxy; or by any member or members present representing not less than 10% of the total voting rights.

Ordinary & Special Resolution

An ordinary resolution is a resolution passed by a simple majority of votes (50% + 1) cast by members of a company. Members entitled to attend and vote should be given 7 clear days notice of the meeting; most standard business conducted at annual general meetings is carried out by way of an ordinary resolution.

 A special resolution must be passed by not less than 75% of the members entitled to vote at the meeting and members should be given 21 clear days notice. Examples of decisions which require a special resolution are changes in company name and reduction of share capital.

The rules for general meetings are well defined in the Companies Act 2014 but to ensure proper procedure is followed it is advisable to have an experienced company secretary convening such meetings.

Corporate Governance

 

Topics: Corporate Governance, Directors, Meetings