AICD submission on virtual meetings and electronic document execution

The AICD strongly supports the Government’s initiatives to modernise and upgrade Australia’s governance and corporate law settings. COVID-19 and the resulting need for emergency legislative relief in relation to virtual meetings and electronic signatures has revealed where regulation has become dated and inflexible. To accelerate economic recovery, Australia needs to step away from incrementally adapting to developments in technology and innovation, towards an agile, updated and fit-for-purpose regulatory environment.

Modernising Australia’s corporate law is an obvious priority, with benefits to stakeholders and organisations across the community. By making regulation technology-neutral, organisations will be nimbler in adapting to business and shareholder/member needs and will encourage innovation and reinvigoration of corporate governance regulation.

Equally, we recognise the concerns of some stakeholders regarding the transparency and quality of shareholder/member engagement in a virtual AGM format. It is critical that technology is used in a way that promotes accountability, through greater visibility and accessibility, and does not disenfranchise individuals.

Against this backdrop, the AICD:

• supports the proposals in the Exposure Draft that will enable organisations to hold physical, hybrid or virtual meetings;
• strongly supports the ability of organisations to have the flexibility to adopt the best meeting format for their circumstances, shareholders/members and stakeholders;
• supports the proposals in the Exposure Draft that will allow for electronic distribution of documents, including notices of meetings;
• supports the proposals in the Exposure Draft that will allow electronic execution of company documents, including electronic signing of minutes; and
• recommends that further consideration be given to adapting the proposals so that they reflect the different size and complexity of organisations subject to the Act. In particular, we consider it appropriate for listed entities to be subject to more detailed obligations to ensure transparency and shareholder engagement in virtual meetings, compared to smaller, not-for-profit entities.