Question

QUESTION THREE IDDISAM Company Limited is a multinational company with its headquarters situated in Accra, Ghana. The time for Annual General Meeting (AGM) scheduled for 21st July is due but has been suspended temporary due to movement restrictions imposed by government to mitigate the spread of COVID-19 pandemic in the form of social distancing and closure of national and international borders and airports. Assuming that you have been hired to advice management on how to convey the AGM adhering to all the restrictions and safety protocol directives, what medium of communication would be BEST to recommend to management given the circumstance and discuss why it will be the best alternative? (30 marks)

Answer 1

The AGM is an important annual event for the shareholders of a company. It is their opportunity to, amongst other things, be presented with information on the financial performance of the company, to put questions to the directors in relation to same and, potentially, to appoint those who will act as directors of the company for the coming year. From the perspective of those charged with the management of the company, the convening of the AGM represents both a firm legal obligation with which the company must comply and an opportunity for meaningful engagement with the shareholders.

In recent times, annual general meetings of listed companies and other companies with a large group of shareholders have been considered virtually infeasible — the risk of spreading the coronavirus was too great. Prohibition orders issued by the authorities have become more frequent and companies had been forced to postpone shareholder meetings. Important structural measures and the distribution of dividends could have been considerably delayed.

Companies must prioritise the health and safety of shareholders, directors and employees. On behalf of the restrictions and safety protocol directives with regarding covid 19 pandemic the best means of communication i would recommend to the company is virtual meeting tools.

That is virtual annual general meeting without being present in person. . Although there is no classical place of meeting in this respect, at least the chairperson of the meeting and the notary public who takes the minutes should meet. The company’s proxy should also be physically present on site for organisational reasons.

Meetings are permitted to be held, and any votes will be permitted to cast, by electronic means or any other means. Although shareholders no longer have the right to attend the meeting, those with voting rights do of course retain their voting rights on resolutions put to the meeting. However, while these shareholders must still be able to vote, they will not have a right to vote by a particular means.

Through this virtual annual general meeting;

· The entire annual general meeting is transmitted by video and audio,

In recent years, the video and audio transmission of the annual general meeting has already been tested successfully by many – especially larger – companies, but is usually limited to the transmission of the speech of the CEO and the report of the supervisory board. In some cases the general debate was also broadcast; in this regard the companies had to pay particular attention to data protection aspects. In contrast to previous practice, the virtual annual general meeting must be broadcast in full. For this purpose, it is advisable to use the proven means and to make them available for the entire annual general meeting.

· Voting rights can be exercised via electronic communication (absentee voting or electronic participation) as well as proxy voting,

In order to exercise voting rights, the management board must first offer the possibility of granting proxy. The use of the proxy nominated by the company, whose authorisation should be made possible by electronic instruction until the end of the general debate, lends itself to this purpose. The management board may then decide to provide for either electronic absentee voting or another method of electronic voting, such as via a shareholder portal with a voting function. In practice, it will be advisable here to first use those instruments that the company has already used in the past, such as some companies already did for e-mail voting. On the other hand, the integration of voting fields, e.g. in the shareholder portal, has not yet been technically implemented and may also be more complex, which would then have to be kept open until the end of the voting process.

· The shareholders are given the opportunity to ask questions by means of electronic communication,

There is very far-reaching relief with regard to the shareholders’ right to ask questions. While the shareholders’ right to speak at the virtual annual general meeting will not apply altogether, the right to ask questions will be considerably restricted. . As a result, the management board can stipulate that questions must be submitted in advance, for example by e-mail or via a shareholder portal. As a precautionary measure, the deadline should be the second day before the day of the meeting.

· Shareholders who have exercised their voting rights electronically can submit objections electronically until the end of the meeting.

Finally, shareholders who are not present in person and who have exercised their voting rights by one of the electronic means opened up by the management board must be granted the right to object to the minutes. The shareholders must be given the opportunity to submit their objection electronically. In practical terms, setting up a specific e-mail address should be a practical way of doing this. Since the notary must note and record objections, it must be ensured that he is given access to the e-mails of objection.

Thus virtual meeting tools act as an effective means of communication during this situation and it helps the management to have the AGM effectively and efficiently with help of the technology. Some of the best virtual meeting apps for video conferencing are as follows;

1. Zoom

Lately, Zoom has become the default video-conferencing tool for business communication. With super-fast functionality, Zoom delivers everything you need for online business meetings.

Features:

· Zoom is easy to set up, use, and manage

· You can join from anywhere using your laptop or smartphone. It supports iOS, Android, Windows, MacOS, and web

· Offers HD video and audio calls

· Offers excellent built-in tools for screen sharing

· Users can get up to 100 participants on a call. To get more participants, you can use the paid service

· Can share multiple screens

· Offers built-in recording and transcripts

· Offers chatbox both for groups and one-on-one messaging

· Access to extra features like webinars, chat, and phone

· Offers robust security solutions.

2. Google Meet

Google Hangout, which is now Google Meet, is yet another good communication solution for online meetings. The rebranding comes at a time when Google is eyeing an extensive rise in usage amidst the COVID-19 pandemic. Meet is a part of the larger G Suite package of collaborative software. Each package of G Suite is loaded with feature-rich applications.

Features:

· Meet is accessible on iOS and Android mobile devices

· Easy to use and operate

· Nonpaying users can invite 25 people to join a video call. With the paid Google Meet service, you can host video calls with up to 250 people depending on the service plan selected.

· You can even invite participants to a meeting straight from your Google calendar

· If you cannot attend the meeting via video, you can use the phone to call into the Google Meeting. The event creator will just need to provide the meeting dial-in number and pin number.

· You can record meetings. Once the meeting is over, the host receives a link of the recording via an email, which they can share with other team members later.

3. Facebook Messenger Rooms

Even Facebook has entered the race for a complete video-calling solution. The company’s CEO recently announced Messenger Rooms, a video conferencing tool.

Features:

· You can create a video room straight from the Messenger or Facebook

· You can start and share rooms on Facebook through News Feed, Groups and Events

· Facebook's new video calls let 50 people to drop in together

· Those who don’t have a Facebook account can also join in. The host will have a link generated that can be shared and used to join the room.

· There is no time limit to the video calls made from Messenger rooms

· The owner of a meeting can control and choose who can see and join the room

· Users will also be able to use AR effects and new features like immersive backgrounds and mood lighting.