Canada’s securities regulators suggest companies don’t have to resend proxy-related materials to shareholders if they plan to move annual meetings online because of Covid-19.
Canadian Securities Administrators (CSA) issued guidance Friday after the country’s largest banks and insurance companies obtained a court order allowing them to hold the meetings using electronic means.
Since changing annual meetings doesn’t fall under the jurisdiction of securities regulators, the CSA recommends that companies review corporate law and their own articles of incorporation and bylaws when considering such changes.
Still, it recommended that additional materials don’t have to be sent or updated if the company issues a news release announcing the change in the date, time or location; files the release on SEDAR; and takes all reasonable steps to inform all parties of the change.
“We expect reporting issuers to take the above actions promptly after making a decision to change the date, time or location of an AGM and sufficiently in advance of the AGM to alert the market in a timely manner,” the CSA said in a statement.
If proxy-related materials haven’t been sent, companies should consider disclosing the possibility of meeting changes because of steps taken to slow the spread of the novel coronavirus.
The guidance relates to all business done at annual meetings, including election of directors and amendments to equity incentive plans.
Companies involved in proxy contests, holding special meetings for merger and acquisition transactions, or obtaining approval to protect minority securityholders in special transactions should contact their main regulator.
Companies planning to hold virtual meetings or hybrid events, including in-person meetings that also permit participation through electronic means, should tell securityholders in a timely manner how they can access, participate and vote.
“The CSA continues to monitor the impact of Covid-19 on Canadian capital markets and may issue further guidance and updates as required.”
Canada’s largest banks and insurance companies have said they will conduct the meetings through webcasting or teleconferences instead of in-person gatherings.
The banks and insurers have obtained a court order that will allow them to make the change in lieu of in-person annual meetings.
The move was sparked by an outbreak in the novel coronavirus, which has caused several of the companies to close brick-and-mortar locations and ask employees to work from home.
The banks included in the court order are the Bank of Montreal, the Canadian Imperial Bank of Commerce, Royal Bank of Canada, Bank of Nova Scotia, TD Bank Group, Laurentian Bank, National Bank of Canada and Canadian Western Bank.
The insurance companies who teamed up with the banks to seek the order include Great-West Lifeco, Canada Life, Manulife Financial Corp. and Sun Life Financial Inc.