General meetings and coronavirus

2nd April 2020
-IAM, News

Daniel Pfund, Senior Financial Analyst

The spring season rhymes each year with the season of annual general meetings of listed companies. According to Swiss law, companies must hold a shareholders’ meeting every year within 6 months after the end of the fiscal year (for the vast majority, according to the calendar year, at the end of December).

The holding of shareholders’ meetings has become more complicated since the government banned any gathering of more than 5 people as a result of the anti-propagation measures of COVID-19. So what can companies do? The board of directors can decide to postpone the general meeting until the end of June at the most, or to hold a meeting without the physical presence of shareholders. Nestlé, for example, has chosen this last solution. In this case, shareholders must exercise their rights through an independent representative. Legally, the shareholders must, among other things, approve the amount of the dividend, otherwise it cannot be paid.