In the past few weeks measures have been announced to slow the spread of COVID-19. Further measures and/or extensions may be expected. Among many other things, COVID-19 will have an impact on the upcoming annual general meetings of shareholders (AGM) of many Dutch listed companies. We foresee them postponing or cancelling their AGMs until further notice influencing and potentially delaying decision-making processes.
According to the Dutch Corporate Governance Code (CGC) - which applies to all companies with registered offices in the Netherlands, whose shares or depositary receipts for shares have been admitted to listing on a stock exchange, as well as large companies (balance sheet value > €500 million) with registered offices in the Netherlands, whose shares or depositary receipts for shares have been admitted to trading on a multilateral trading facility or comparable system – shareholders and other voting right holders should have the opportunity to issue their voting proxies/instructions to an independent third party.
An independent proxy holder enables your shareholders to issue voting proxies and instructions prior to an upcoming AGM, without physical attendance on your premises. The AGM can still take place with less attendees, whilst ensuring a valid and objective decision-making process, an increase of investors’ participation and the reliability of the business. It also makes your company more resilient in case of unforeseen circumstances, such as COVID-19.
Compliance with the CGC is based on the ‘comply or explain’ principle and should be covered in the annual report of the company, ensuring transparency and continuity.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.