Definition: An Annual General Meeting or AGM provides a forum for managing a company to discuss and share information about the company and its financial performance with those who have voted or provided investment funding.
Business owners attend the meetings to provide input on strategic priorities for the company; shareholder proposals are presented at the meetings and voted on by the company’s directors. A company’s primary responsibility is to its investors; therefore, a company’s management maintains tight control over all information shared at an AGM not to give a misleading impression to investors or the public generally.
At the annual general meeting (AGM), directors of a company can also present their annual report on behalf of the company to shareholders. This meeting aims to allow shareholders to provide input into how the company will run its business the previous year. In addition to giving shareholders information about their company, an AGM also allows directors to answer questions from shareholders regarding specific business issues or opportunities that may arise during the year.
At this meeting, one or more directors may be absent due to personal reasons, an issue that affects the business, or other reasons that may be brought to light. The proxy vote for directors will be taken at that meeting, and any shareholder who could not attend may cast a proxy vote in writing.
Often, activist shareholders use an AGM as an opportunity to
- Voice their disapproval or concern about a business matter;
- Request that the board take action to affect their interests
- Request that a current shareholder is invited to submit a proposal for consideration at an upcoming annual meeting.
The annual general meeting (AGM) of a corporate board of directors is the most important event in a directors’ career. The purpose of the meeting is to:
- Approve or disapprove the business and financial performance report for the previous year;
- Approve or disapprove a director’s appointment to interim office and fill such vacancies as occur during sitting years;
- Elect new Directors to fill vacancies that may occur before the annual meeting;
- Approve any settlement agreement that may reduce the outstanding deficit of a previous year; and
- Approve or reject additional compensation.
An AGM can allow the entire company to present to the full board the latest strategic plans and financial projections. It is also an excellent time for executives to layout their performance plans for the year–and if there are bonuses due, they may want those targets set as well. The key to an effective annual general meeting is doing all your homework beforehand to be well-prepared and deliver a conversation that makes everyone feel good about where the company is going.
An Annual General Meeting (AGM) is an informal (but not anonymous) meeting of the employees of a company held each year to discuss business and plan the company’s future. As the name suggests, an AGM is not mandatory for all companies, but it is more common among large companies with management teams that have spent a lot of time together and have developed a level of trust and rapport.