MANILA, Philippines — The Securities and Exchange Commission (SEC) said companies can continue to hold virtual or remote shareholder meetings even after the pandemic and urged the firms to allow shareholders to participate in these meetings.
Virtual board meetings, including casting of votes, are also allowed in accordance with internal procedures, the SEC added.
Republic Act 11232 or the Revised Corporation Code of the Philippines allows for the participation of directors or trustees, officers, and shareholders or members in corporate meetings through remote communication.
SEC chairperson Emilio Aquino said corporations may continue holding meetings through remote communication or other alternative modes as provided under the Revised Corporation Code.
Last year, the SEC issued a circular that allows virtual meetings as travel restrictions and other stringent public health protocols were imposed to curb the outbreak of COVID-19.
The SEC, however, clarified that allowing participation in corporate meetings through remote communication or in absentia was not an interim measure meant to take effect only during the pandemic.
“The provisions of the Revised Corporation Code for the virtual participation of shareholders or members, directors or trustees, and officers in meetings allow for greater stakeholder involvement in corporate governance,” Aquino said.
The SEC chief said stronger stakeholder engagement brings in more insights that could translate to well-grounded decisions and innovations, and promotes transparency and accountability in the decision-making.
“All these will ultimately redound to the benefit of the corporation,” he said.
Stockholders or members shall notify in advance the presiding officer or corporate secretary of their intention to participate through remote communication.
“The right to vote of stockholders or members may be exercised also through remote communication or in absentia when authorized by a resolution of the majority of the board. The resolution, however, shall only be applicable for a particular meeting,” the SEC noted.
Corporations shall also adopt measures to ensure that all stockholders or members have the opportunity to participate in the meeting, including an opportunity to read or hear the discussion substantially.
In addition, the internal guidelines shall include procedures for documenting the meeting and any process or motion that may be done afterwards, and a mechanism to make the record of the meeting, either in video or audio format, available to stockholders or members.
For board meetings, the company shall develop the internal procedures for the conduct of board meetings through remote communication or other alternative modes to address administrative, technical and logistical issues.
The SEC said directors or trustees who intend to participate in a meeting through remote communication shall notify in advance the presiding officer and corporate secretary.
“The directors or trustees shall be deemed present for the purpose of attaining quorum. During the roll call, they shall state their location, specify the device they are using and confirm that they can clearly hear and/or see the other attendees, among others.