The exercise of voting power is one of the most important aspects of being a shareholder. This chapter considers the mechanics of voting in person or by proxy and the different types of resolutions that may be used, including the possibility for private companies to use written resolutions. For larger companies, the annual general meeting is an important forum and the chapter considers meeting procedures, the calling thereof, notice requirements, the circulation of resolutions and agenda items, as well as the power of the court to order meetings to be held. The important Duomatic principle—the effectiveness of informal unanimous assent without any meeting—is also considered in detail.
Chapter
17. Decision-making and company meetings
Chapter
5. Members
This chapter focuses on one of the vital roles played by members of a company, namely their ability to make decisions. A significant amount of power is placed in the hands of members, and numerous key decisions are reserved for them alone. This chapter looks at the rules by which general meetings are run and discusses the effectiveness of the general meeting.
Chapter
14. Meetings and investor engagement
This chapter examines the role and importance of general meetings, the significant body of procedural rules by which general meetings are run, and the extent to which a company’s members actually engage with general meetings. Members make decisions in one of two ways: through a resolution or by unanimous assent. A resolution is simply a vote that requires a specified majority vote in its favour in order to be passed. The resolutions of public companies must be passed at meetings, whereas resolutions of private companies can be passed at meetings or via a written resolution. In some cases, companies are required to hold a class meeting in which only one class of member is entitled to attend. To encourage institutional investors to engage more, the Financial Reporting Council (FRC) has published the UK Stewardship Code.
Chapter
5. Members
Each Concentrate revision guide is packed with essential information, key cases, revision tips, exam Q&As, and more. Concentrates show you what to expect in a law exam, what examiners are looking for, and how to achieve extra marks. This chapter focuses on one of the vital roles played by members of a company, namely their ability to make decisions. A significant amount of power is placed into the hands of members and numerous key decisions are reserved for them alone. This chapter looks at the rules by which general meetings are run and discusses the effectiveness of the general meeting.
Chapter
5. The Board of Directors as an Organ of the Company
This chapter discusses: members’ rights and duties under the Companies Act 2006 and the company’s constitution; the problems in dividing power between the company’s members and directors, and the consequences of that division; the rules of interpretation that apply to constitutional documents; the practical exercise of the decision-making powers given to members, including the formalities of meetings and the possibility of informal agreements; the legal constraints on the exercise of power by shareholders; and the enforcement of the constitution by the members, and their potential use of shareholders’ agreements to achieve what they cannot achieve via the articles.
