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Guidance on the use of virtual board meetings

Given the recent stay at home measures instigated by the Government and the ban on public meetings, hosting a board meeting to pass necessary decisions may be proving somewhat difficult!  In light of this, the Chartered Governance Institute published, on 28 March 2020, guidance on virtual board and committee meetings.

The guidance covers the following issues:

1. Initial Considerations. Consideration needs to be given as to what platform should be used.  Many boards host meetings by telephone conference call, but it is also possible to use a virtual meeting application.  Fundamentally, a physical meeting is no longer necessary, as the Companies Act 2006 facilitates the use of e-communications, however you must check your articles of association to ensure that telephone or video conferencing is permitted.

2. Before the meeting. The guidance sets out the practical steps that directors should take when setting up the meeting or the call.  Helpful tips include:

  • Scheduling shorter meetings and including breaks, as people’s attention span can be shorter on the phone or on an app;
  • Circulate the link and dial in details for the meeting. This should be circulated on the meeting invitation, agenda and by email.
  • The Company Secretary (or their designate) should act as host. They should open the call 10-15 minutes before the start time, to allow a prompt start and deal with any issues in technology.
  • Issue clear joining and conduct instructions.
  • Use audio-only calls for large meetings.
  • Review start times. There can be issues with starting calls at peak times, due to bandwidth limitations, so consider starting the meeting just before or just after the hour or half hour.

The guidance also provides suggestions on how to support the Chair, such as agreeing how to communicate during the meeting, providing a timed agenda and setting clear outcomes for each agenda item.

3. During the meeting. The guidance addresses matters such as:

  • Absences. Any apologies for absences should be recorded.  If anyone is unable to attend, then the Chair should speak to them before the meeting to get their views, answer any questions and to pass on any comments that may have to the meeting.  The Chair should also contact them after the meeting to advise them of the outcome.
  • Attendance. If using a virtual meeting app then the person hosting may be able to see who is present, when they leave and also when others join. If this facility is not available, then the Chair or the company secretary should do a roll call at the start, to ensure that everyone is present.  They should also request that participants advise if they have to leave the call.  At the end of a meeting (under “Any Other Business”) the Chair should ask participants by name, if they have any other matters to raise.  This will then also allow the Company secretary to check who is still on the call.
  • Papers. If everyone is having to work from home, it may not be possible to send paper packs out.  Alternatives include use of electronic board portals or emailing out board packs in pdf form.  When circulating papers by email it is recommended that the papers are password protected and the passwords circulated separately.  Some virtual meeting apps allow documents to be shared on screen during the call, to ensure everyone is looking at the same thing.  If this facility is not used, then the presenter should indicate which page number they are on, as they move through documents.
  • Make sure that it has been agreed with the Chair, before the meeting, how participants will communicate with each other during the meeting. This may be via text messaging, or the virtual meeting app may have a messaging facility.
  • Chairing the virtual meeting. It is recommended that ground rules are circulated. There is an example of these at Appendix 4 of the guidance (see link below), Appendix 1 also includes notes for the Chair to assist with the smooth running of the meeting.  Appendices 2 and 3 provide notes for the company secretary and for presenters.  It is important that the Chair is exceptionally clear about leading the meeting through the agenda.  Even if there is a video link there will not be the normal lines of sight and for telephone conferences it can be even harder for participants to keep track of what is going on.  Board papers should indicate whether a decision is required or if the item is for noting/information only.  The usual nods or show of hands will need to be replaced by spoken assent (or dissent).  Some virtual meeting apps may have the facility for an electronic voting process.

4. Technical Considerations. In addition to considerations concerning equipment needs and IT support, the guidance states that minutes should be taken as usual and that recording board and committee meetings is not recommended.

5. After the meeting. Ask for feedback and see what can be improved next time.  Make sure that you address any issues in good time before the next meeting.  Update any ground rules if necessary.

Alternatives to a meeting

If face to face meetings are not possible and technology fails or isn’t practicable then the following options may be available.

1. Written resolutions

Most companies’ articles of association allow board decisions to be made by written resolution.  This might be unanimous or by majority.  The exact wording of the resolution can be circulated by email and agreement given by email under the e-communications provisions of the Companies Act 2006.  It is not necessary for each director to print out the resolution, sign it and scan it back.

Any written resolution should still be recorded and if the consent is by email then a copy of the email agreement from each director should also be put in the minute book.

2. Email “meetings” 

This where a proposal is circulated by email and people communicate their views over the email, with an indication as to whether or not they support the proposal.  This is not ideal as those participating cannot communicate with everyone at the same time and there may be delays between the messages.  Furthermore, people may change their minds as the ‘conversation’ progresses which will mean that the end decision may be unclear.

3. Delegation to Committee

Matters can be delegated to a committee of 2 or 3 directors.  Delegation in this way can be effected by the written resolution method detailed above.

4. Subsequent ratification

This is where a decision is taken informally, with the intention that it will be ratified at a future board meeting.  This again may not be ideal as circumstances may change and some directors may change their minds about ratifying the original decision.

Further details on the matters set out above can be found in the guidance issued by the Chartered Governance Institute at https://www.icsa.org.uk/assets/files/pdfs/guidance/good-practice-for-virtual-board-and-committee-meetings-web1-002(1).pdf

For more information on the issues raised in this article, then please contact a member of our corporate and commercial team on 01524 548494 or 01228 552600.

This alert does not provide a full statement of the law and readers are advised to take legal advice before taking any action based on the information contained herein.

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