Listed Firms Now Prefer Virtual Meetings During AGMs

A good number of firms listed at the Nairobi Securities Exchange (NSE) are working towards changing their articles of Association to accommodate virtual annual general meetings while abandoning the ordinary physical gatherings.

According to some firms, Coronavirus has disrupted most activities scheduled for this year but it has however changed a lot in terms of technology and preparedness.

AGMs were preferred for endorsing payments of dividends and voting new leaders for firms but currently, due to the Covid-19, that is only possible through virtual meetings.

In April, a high court ruling allowed firms to go for virtual Annual General Meetings, and firms such as ABSA, Stanbic Bank, BAT, and KCB Group are already adjusting their Articles of Association to fit with the current situation.

“The directors view this as an opportune time to modernize the company’s Articles of Association and have proposed a new set of Articles of Association, “BAT told its shareholders.

“The board may make arrangements for simultaneous attendance and participation by electronic means allowing persons do not present together at the same place to attend, participate and vote at the meeting,” Stanbic told its members.

Other firms including Eveready and Limuru Tea suspended their AGMs scheduled for this year while Total did not change anything on its AoA and it is planning to the Court to oppose the High Court ruling in April.

Removing physical AGMs from their AoAs will however help firms reduce their budgets significantly as expenses will be avoided.

When holding physical AGMs, firms were spending millions on hotel bookings, the printing of materials such as annual reports, providing meals for attendees while as well giving them goodies, transport, and other expenses.

Holding Virtual meetings is currently the new normal for most firms and there is a high probability that firms might stick with the idea for a while if shareholders are satisfied with how it works.