Shareholders must be able to make decisions on an informed basis. This is true when making decisions on whether to buy, hold or sell securities, as well as when voting on corporate actions and other resolutions at shareholder general meetings.
Amid the COVID-19 pandemic, virtual general meetings have become the norm following the introduction of temporary legislative relief. The virtual format of meetings has its benefits, not least enabling public health and safety. Yet it also has challenges. In recognition of these aspects, we issued a Regulator’s Column on Dec 16 2021 to introduce practices aimed at ensuring shareholders remain well-informed even as general meetings go virtual.
These practices include requiring public responses to shareholder questions between 48 hours and 72 hours prior to the closing date and time for the lodgment of proxy forms. Issuers were also expected to organise a virtual information session for shareholders when convening a general meeting to seek shareholders’ approval in relation to corporate actions such as transfers to or from Mainboard to Catalist, capital reduction or distribution, and interested person transactions.
Since then, safe management measures (SMMs) and the return to normalcy have made possible the resumption of general meetings in the physical face-to-face format practised pre-COVID. Issuers can nevertheless continue to hold either a virtual-only meeting or adopt a hybrid format. The physical general meeting provides shareholders with the ability to directly and immediately engage with the Board and vote thereafter.
SGX RegCo similarly expects issuers to accord shareholders with the same full rights should they choose to hold virtual-only meetings. These rights include the right to attend, ask questions and communicate their views; and to appoint proxies or to vote at general meetings.
Issuers that choose to conduct fully virtual general meetings must utilise both (i) real-time electronic voting and (ii) real- time electronic communication at their general meetings.
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Notably, several SGX-listed companies have successfully done so at their virtual AGMs despite a fairly large shareholder base and consequently a high number of attending shareholders.
We have updated the FAQs to clarify our expectations in relation to the Guidance on the Conduct of General Meetings Amid Evolving COVID-19 Situation. We understand that issuers may need time to prepare for a resumption of normalcy and to engage their stakeholders. Based on feedback from the market, SGX RegCo wants to ensure issuers have ample time to put in place arrangements to engage shareholders effectively through physical, virtual-only, or hybrid meetings.
Therefore, all issuers holding their annual general meetings for financial years ending 30 June 2022 or after must conform to these expectations. Issuers holding any other general meeting on or after 1 October 2022 to seek shareholder approval for corporate transactions must also take into account the expectations set out in this column.
Tan Boon Gin is CEO, Singapore Exchange Regulation
