Should We Call Time on AGMs for Residents’ Management Companies?


Managing Director David Collinson reports on a suprising result at an AGM we held for one of our large resident’s management companies.


Recently, we organised an AGM at a large block in London. We had good reason to believe the meeting would be a lively and busy one. Over the last year there had been several big issues regarding the replacement of external cladding and fire safety at the property. As managing agents, we had spent a lot of time managing numerous inspections and meetings from the fire service, local government and fire safety consultants.

Understandably, we were fielding questions by residents over the course of many months, concerned at possible rising building costs associated with these new fire safety measures being suggested. We tried to keep all stakeholders informed as we went along however the AGM was always in our minds as being the culmination of a year’s hard work. We anticipated high attendance with many questions which is why our senior management team had spent months detailing our work and then weeks preparing a power point presentation that went into the fine details of everything we’d done. On the day, we sat at the table, ready to present.

The doors opened promptly at 6pm. Three people walked in. Another couple came in within the hour. By 7.55 pm - five minutes before the meeting was due to end - the total number in the audience was 11 people. Out of 124 member units. We drew the meeting to a close, packed up our gear and went home.

This situation made me wonder: if an AGM can’t pull a crowd under these circumstances and current legislation states you don’t have to have one, is there even a point to AGM’s anymore?
 
There is no requirement under the Companies Act to hold an AGM. The requirements for an AGM usually rest within the resident’s management company’s Articles of Association and it’s safe to say that most RMCs still include provision for an AGM. 

Typically, the chairman of the board chairs general meetings unless the meeting itself decides otherwise. As corporate secretary to many RMCs, Block Management UK has chaired many meetings, and this is common practice. One of the main reasons for having the managing agent chair the meeting is that we can be relied upon to follow all applicable rules for instance giving all members of the RMC sufficient notice of the meeting. It is good practise to hold at least one meeting per year.

However, the decision to have an AGM comes down to the governance of the company itself, then Directors could modify this requirement through a Special Resolution at a Directors’ meeting.
 
Or should we go to a digital AGM? Perhaps we could host a live meeting online, like a forum.  If we make it easy to attend a meeting without even leaving your flat, this might encourage more people to attend.

However, the danger of digital meetings is that people act differently online than face to face. For instance, our 124 member-unit property above had a large and very vocal WhatsApp group who we expected to all turn up to voice their opinions at the AGM.
 

Why AGMs remain important


After the AGM ended, my staff and I were satisfied that we’d fulfilled our obligations to the residents. We were happy with the work we put into the presentation and that at least someone got to see it. And that work is still available for stakeholders to see.

Despite our experience this week, I do think the AGM is still a valuable experience for residents. It’s an opportunity to discuss issues, to present results, go into details, have accountability, answer questions, come to an agreement and get people on board.

Use it or lose it. Non-attendance, even in the face of extremely important issues, underlies our efforts to keep all residents better informed as we go. But, if it had been my flat, I would have turned up!
 


(07 May 2019 )