Business Law Blog

Beginning in 2020, in response to the enduring challenges of the COVID-19 pandemic, many reporting issuers pivoted from in-person shareholder meetings to virtual shareholder meetings. Virtual meetings are either held entirely virtually or rely on a “hybrid” model allowing for both virtual and in-person participation.

In light of recent corporate law amendments expressly allowing for virtual meetings, the Canadian Securities Administrators (the “CSA”) conducted informal consultations with market participants and stakeholders. On February 25, 2022, the CSA published guidance on conducting virtual shareholder meetings that is intended to assist reporting issuers in complying with their continuous disclosure obligations and encourage procedures that facilitate shareholder participation. 

Specifically, the CSA reminded issuers that:

• meeting materials should provide shareholders with clear and comprehensive disclosure with respect to logistical considerations, including how to access, participate in and vote at a virtual meeting;
• they should provide complete explanations on the registration, authentication and voting procedures for both registered and beneficial shareholders;
• they should disclose how shareholder questions will be received and addressed, and any other actions that will be taken to accommodate and manage shareholder participation; and
• they should provide shareholders with contact information where they can obtain assistance with registering for, accessing, or attending a virtual meeting.

The CSA also encouraged issuers holding virtual meetings to ensure that shareholders are afforded a level of participation comparable to what could be reasonably expected at an in-person meeting. In particular, shareholders should have the opportunity to make motions and raise points of order during the meeting as well as ask questions and directly provide feedback to management during any question and answer periods. Additionally, proponents of a shareholder proposal put to the meeting should be given the opportunity to speak to the proposal. The CSA acknowledged that while the chair of a virtual meeting must exercise some discretion in managing the meeting, such discretion should be exercised in a transparent manner, consistent with established practices for in-person meetings.

Finally, the CSA recommended that, in the case of a contested shareholder meeting, specific consideration should be given to the appropriateness of conducting the meeting virtually and issuers should consider establishing agreed upon meeting protocols with the dissident prior to the meeting.

To discuss the holding of virtual shareholder meetings and the preparation of meeting materials in respect thereof, please contact any member of our Corporate Finance and Securities Group.