What Is An Annual General Meeting?
As part of setting up your new company, you're likely to have come across the term "AGM" or "Annual General Meeting". But if you're new to running a business, it may not be clear what this actually entails.
An AGM is an annual gathering of the shareholders of a company and the company directors. It is typically the only time during the year when they will all meet to discuss the standing of the company.
AGMs aren't just held by companies, they can also be held by schools, universities, charities and unions. Whether an organisation will need to hold an AGM will be set out during the incorporation process.
Why are AGMs important?
During the meeting, opportunities will arise for shareholders to vote on matters concerning the company, this includes the ability to select the board of directors for the coming year.
AGMs are important for the running of a company because they bring about transparency between the shareholders and directors, as well as an ability to hold managers accountable for their actions.
What happens during an AGM?
During the AGM, the shareholders and the company directors discuss the company's performance as it stands and the strategy for the future. During this time, the shareholders can question the company directors about any unsatisfactory performance and challenge them on their plans for the future.
At the same time, the AGM can be used as an opportunity to praise a good trading year and any positive moves that were made.
The shareholders have the opportunity to vote on any matters concerning company decisions and to fill any vacant positions on the board of directors.
If a shareholder is unable to attend for any reason, they are entitled to vote by proxy. This can either be done by post, or by giving permission for another shareholder to vote on their behalf.
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