Annual general meeting (AGM): A comprehensive guide with key steps

An annual general meeting (AGM) is one of the most important events in any organization’s calendar. It provides the company with an opportunity to share successes, future plans and commitments with shareholders and invites them to engage and vote on key decisions.

There’s so much to consider with an AGM, and proper preparation is vital to ensure everything is smooth and streamlined. To do this, you need to understand the process of planning, organizing and conducting a successful AGM. Whether you’re a seasoned investor or a company executive preparing for your company’s AGM, there are best practices you can follow so there’s transparency, compliance and engagement.

In this guide, we’ll cover all the important information you need to know about AGMs, including:

• What an AGM is and why they matter
• The key components of an AGM
• How to prepare for an AGM
• How to prepare for an AGM
• What an AGM agenda looks like
• What happens after an AGM
• The role shareholders play
• The role technology plays

If your organization is preparing for an AGM, or you’re an investor about to attend an AGM, we’ll cover the key points below so you can make sure it’s a success.

What is an annual general meeting

An AGM is a formal meeting legally required to be held annually by a company, organization or institution that details the financial performance and plans for the future. It aims to provide full transparency and honesty to shareholders. Shareholders are also given the opportunity to vote on key issues and provide feedback.

The purpose of an annual general meeting is to:

• Provide a clear and comprehensive overview of financial and operational results.
• Offer the opportunity to request feedback and engage in votes on key business decisions, such as leadership and policies.
• Remain compliant with regulatory requirements, due diligence and accountability.
• Build relationships and engagement between stakeholders and the organization.

Examples of what may be discussed at an annual general meeting include:

• Financial matters.
• Leadership and governance.
• Strategic and operational updates.
• Stakeholder engagement and voting.

Key components of an annual general meeting

There are several key components that make up an AGM. These include:

1. Notice of meeting

The notice of meeting is sent to stakeholders ahead of the AGM. It provides information related to the date, time and location of the meeting. It also provides the meeting agenda and information on how the meeting can be accessed virtually, if applicable.

2. Quorum

Quorum is the number of board members required to start the meeting, which is outlined in the organization’s policies.

3. Agenda

The agenda details everything to be covered in the meeting, such as:

1. Opening remarks
2. Previous meeting minutes
3. Presentation of reports
4. Election of board members
5. Discussion of resolutions
6. Q&A session
7. Closing remarks

There should also be ample time allotted for any other business, should the need arise.

4. Chairperson

The chairperson presides over the meeting to make sure it’s structured, streamlined and sticks to the agenda.

5. Presentation of reports

As outlined in the agenda, the reports are presented to stakeholders. These include:

• Financial reports.
• Operational reports.
• Audit report.
• Director’s report.

6. Voting

Stakeholders are given the opportunity to vote on key organizational issues such as:

• The election or re-election of board members.
• Approval of financial statements.
• Appointment of auditors.

7. Minutes of the meeting

A formal record of the AGM is created in the form of meeting minutes. This includes all discussions, decisions and resolutions and is maintained to ensure compliance and due diligence.

8. Engagement with stakeholders

Stakeholders are encouraged to ask questions, offer feedback and share their concerns.

9. Closing the meeting

The chairperson summarizes the outcomes of the meeting and thanks all members and stakeholders for their attendance and participation.

10. Post-meeting actions

The meetings are distributed in a timely manner, and all reports are filed with the relevant authorities.

How to prepare for an annual general meeting (AGM)

Before an AGM, there are many considerations to ensure you’re fully prepared. Here’s what you should do before an AGM:

1. Understand the legal requirements by checking statutory rules and regulations and filing deadlines.
2. Set the date, time, and venue for the AGM so that it is accessible to stakeholders, and communicate with plenty of advance notice. It’s also recommended that the AGM allow for virtual access for stakeholders who can’t attend in person.
3. Draft, approve and distribute the agenda.
4. Prepare the presentations that cover financials and operations.
5. Organize how voting will be conducted, whether this will be in-person or electronically.
6. Confirm attendance and quorum by tracking RSVPs and ensuring all quorum requirements are met.
7. Brief the chairperson and any key participants to ensure they’re familiar with the materials and agenda so they can anticipate and prepare for any questions.
8. Test that any technology being utilized works as intended and is fully accessible.
9. Prepare any supporting materials, such as printouts or PDFs, such as reports, minutes or voting instructions.

AGM follow-up steps

An AGM is far more than a box-checking exercise. Everything actioned, agreed, raised and discussed must be followed through as part of the board’s obligations to the business and its stakeholders.

After the meeting, the minutes should be finalized and distributed, along with the outcomes of the meeting and the steps that will be taken to action what was discussed.

Any necessary documents must also be filed with the relevant authorities, such as financial statements or updated director information.

The resolutions that were implemented must be actioned within the agreed time limit.All internal documentation should be updated to align with the changes, along with stakeholders being updated on progress.

To improve future AGMs, request feedback from attendees. You should also take steps to prepare for the next AGM.

How to conduct an effective AGM

Your AGM is an important date in your calendar. It can contribute massively to how your stakeholders view the success of your organization and perceive the board’s performance. Below are some tips and best practices for conducting an AGM:

• Prepare well in advance so all aspects are thoroughly covered and you can share as much information with stakeholders as possible.
• Have a clear objective for what you’d like to achieve in the meeting, such as voting on resolutions or financial approval.
• Prepare a structured agenda and ensure you assign realistic time slots. Create the agenda around the reports and assets you’ve created rather than the other way around.
• Ensure legal compliance at all times by referring to notice periods, quorum and filings.
• Engage stakeholders early and make sure the meeting can be attended virtually to maximize attendance and engagement.
• Have a simple and accessible voting process.
• Create a welcoming atmosphere and start on time to show that you value stakeholders’ time.
• Always be transparent and clear, even when delivering less than favorable information. Answer questions directly and honestly – if you don’t know the answer to a question, follow up to provide this after the meeting.
• Stay focused and organized by following the agenda and ensuring time is effectively managed.
• Document the meeting thoroughly with accurately recorded minutes, which are distributed afterward.

The role of shareholders in an AGM

Shareholders play an important and active role in an AGM as they’re responsible for contributing to key decisions that impact the future of the business. There are several ways shareholders can engage during an AGM, including:

Voting

Shareholders vote on resolutions, either in person or electronically. Votes are usually reserved for significant decisions, such as financial statements, electing board members, strategic decisions and appointing auditors.

If a shareholder can’t attend the AGM, they may be able to appoint a proxy to vote on their behalf. The process for proxy voting will be outlined in the organization’s policies.

Shareholder proposals

Shareholders can submit proposals in advance of the AGM for discussion during the meeting or take part in a discussion to review and approve submitted proposals.

Electing board members

Shareholders can elect and re-elect members of the board, which are then approved or rejected ahead of the vote.

Reviewing reports

Shareholders can review the financial and operational reports presented during the meeting, which can then be voted on. They also have the right to ask questions or request further information if necessary.

How technology can support virtual and hybrid AGMs

Technology plays a huge role in modern-day AGMs. Not only does it ensure the meeting runs far more smoothly and streamlined, but it opens it up to be attended by remote participants, introduces easier and more efficient voting processes and offers a higher level of convenience and accessibility. Learn more about our voting features and how they can improve your voting process.

On top of this, technology can also make preparing for an AGM far more streamlined. This means you can ensure compliance and stakeholder due diligence while also ensuring preparation isn’t a long and drawn-out process.

Your organization can utilize various tools to help preparation be streamlined and efficient:

1. Agenda builder A robust agenda builder is essential for creating, sharing and managing the meeting's schedule. This helps organizers stay on track and ensure that all necessary items are covered.
2. Board minutes Accurate and timely minutes are crucial for documenting the meeting. A board meetings feature with automated note-taking capabilities simplifies this task, ensuring that all decisions and discussions are recorded.
3. Secure collaboration Secure communication, collaboration and document-sharing tools are vital for virtual AGMs to protect sensitive information and ensure stakeholders can engage safely.
4. Comprehensive board solutions A comprehensive platform like Diligent Boards allows seamless leadership collaboration and management of all AGM-related processes, from pre-meeting preparation to post-meeting follow-up. Learn more about Diligent Boards and how it can streamline your board’s processes.

Streamline your AGM preparation with Diligent

AGMs are an important but often time-consuming process which requires a huge amount of preparation to make sure your business presents everything openly and honestly to stakeholders.

Here at Diligent, we make board management simple. Automate processes, utilize templates and offer accessible ways for board members and stakeholders to engage. For more information, read our guide for corporate secretaries.

FAQ’s

What are the legal requirements and regulations I need to be aware of in relation to AGM/s?

The legal requirements for an AGM can vary by jurisdiction but will often include the following:

• Notice of meeting
• Quorum
• Voting
• Filing requirements
• Election of directors
• Financial and auditor reports
• Shareholder proposals

At what point in the year do AGMs take place?

AGMs usually take place at the end of an organization’s financial year. Some jurisdictions require the AGM to be held within a certain time following the end of the fiscal year. For public companies, this is within six months. It’s a little less restrictive for private companies but is usually within 12 months.

What is the purpose of an annual general meeting?

The purpose of an AGM is to provide stakeholders with an overview of the finances and operations of the organization. Stakeholders are also encouraged to provide feedback and vote on key topics that affect the future of the business.

What is the difference between an AGM and an annual meeting?

The terms annual general meeting and annual meeting are often used interchangeably. However, the AGM is a formal meeting required by law, and an annual meeting is a more informal meeting that the organization may hold each year and won’t have the same requirements or formalities.