Company Meetings in Singapore: A Comprehensive Guide

Company Meetings in Singapore: A Comprehensive Guide

In Singapore, companies are required to hold several mandatory meetings by law. The conduct of these meetings is governed by the Company Law in Singapore and the Company Constitution.

The frequency and format of meetings in each company are different, according to the type of business, size, constitution, etc. However, companies conduct several kinds of meetings for the same purpose;  to make critical decisions. This article will further highlight a few types of company meetings in Singapore.

 

Company Meetings in Singapore

In general, company meetings in Singapore are broadly divided into two main categories: shareholders’ meetings and directors’ meetings. Let’s learn about each meeting in more detail.

Shareholders’ Meetings

Shareholders are people who represent part of the ownership of the company. Their ownership entitles them to decide certain business matters. Shareholders’ meetings provide an opportunity for shareholders to supervise company affairs. They do so by approving business issues the company raises in meetings.

There are three types of shareholders’ meetings:

1. Shareholders’ First Meeting

Also known as a “statutory meeting,” a shareholders’ first meeting is a mandatory meeting of shareholders of a public company. Within a certain period of time from the commencement of business, companies are obliged to hold this meeting.

A company can conduct a shareholders’ first meeting once in a lifetime. The company’s board of directors will send a statutory report containing company details to all its members seven days before the meeting date. The company must also submit a copy of this report to the registrar seven days before the meeting date. 

Who needs to conduct this meeting?

Only public limited companies with share capital are required to conduct a shareholders’ first meeting. Companies incorporated as private limited companies are not required to hold this meeting.

What is the purpose of this meeting?

The main objectives of this meeting are as follows:

1. To discuss the following matters with shareholders:

  • The company’s progress since it was established;
  • The company’s expectations for its growth;
  • Contract signed by the company; and
  • Plans and company prospects.

2. To talk about the statutory report consisting details such as:

  • The share allotment structure;
  • Number of shares issued;
  • The total amount of receipts and payments; and
  • Name of company directors, CEO, company secretary, auditors, etc.

2. Shareholders’ Annual General Meeting (AGM)

An annual general meeting (AGM) is a shareholder meeting that must be held by Singapore companies every calendar year at certain intervals. This meeting gives the company shareholders the right to participate in certain company decisions.

Who needs to conduct an AGM?

It is mandatory for public companies to hold an AGM each year. Private companies are not obligated to do this, but they can hold an AGM voluntarily. According to the company law in Singapore, private companies also have the option to cancel the holding of the AGM. 

What is the purpose of an AGM?

The primary purposes of the AGM are:

  • To present financial statements; and 
  • To approve other company’s business transactions.

What is presented during an AGM?

At the AGM, the company must present complete financial statements to shareholders. The financial statements must provide a “true and fair” view of the company’s financial performance throughout the year.

In addition to presenting its financial statements, the company will have to approve other business transactions from the company. Here are some business matters that require shareholders’ approval at the AGM:

  • Dividend declaration;
  • Retirement and appointment of directors;
  • Appointment of auditors; and
  • Authorization to issue shares.

When should a company conduct its AGM?

The Companies Act determines the timeline for companies for presenting their financial statements at an AGM as follows:

  • Within four months from the end of the financial year for public listed companies, or
  • Within six months from the end of the financial year for other companies.

For complete information about annual general meetings, please refer to: 

An introduction to Annual General Meetings (AGM) in Singapore

3. Shareholders’ Extraordinary General Meeting (EGM)

A shareholders’ extraordinary general meeting (EGM) is a meeting that the companies can hold at any time depending on the urgency of the issue that requires shareholders’ approval.

Who needs to conduct an EGM?

The board of directors and members of any company may convene an EGM.

What is the purpose of an EGM?

An EGM is held by a company whenever there is a critical business issue that requires shareholders’ approval. For example, when there is a change in the company’s articles of association, then an EGM is necessary to be convened. Unlike an AGM, only specific issues are discussed at an EGM. 

Who has the authority to convene an EGM?

The Companies Act authorizes one director or two members (holding ten percent or more of the share capital or constituting not less than five percent of the total members) to conduct an EGM.

 

How to Conduct a Shareholders’ Meeting

Here are the guidelines for holding a shareholders’ meeting that any company in Singapore needs to follow:

Notice of Meetings

Prior to the meeting date, a notice must be sent to all company members, shareholders, and officers. The main requirements of the content and timing of the summons for the shareholders’ meeting are as follows:

  • The notice must specify the date, place, and time of the meeting.
  • It should define matters the company should discuss at the meeting.
  • It must state the member’s rights to appoint an attorney.
  • In the case of a special resolution, the notice must mention the “special resolution” requirement for approval of a proposed transaction.

The notice of a meeting should be sent :

  • Two weeks before the meeting date (in the case of a business that requires passing an ordinary resolution); or
  • Three weeks before the meeting date (if the business requires the passing of a special resolution); or
  • Four weeks before the meeting date (if there is a special notice requirement).

Note:

Your company could give shorter notice for the meeting if the members invited to attend and vote to approve it. Your company secretary should be the one responsible for drafting and sending the notice. 

Electronic Notices

A recent amendment to the Companies Act in Singapore allows companies to send meeting notices electronically. The new approach is expected to help reduce companies’ costs and increase their efficiency. The company’s constitution will determine the mode of electronic transmission (e.g., email, fax, notification of upload on the company website, etc.) as the default mode of sending notices. 

Quorum

A quorum refers to the minimum number of members required in a meeting for decision-making to be valid. If the quorum is not reached, then voting cannot be done in the meeting, decisions cannot be taken, and the status quo will be maintained.

In Singapore, company meetings must be attended by a minimum of two members of the company constitution stating otherwise. In addition, a company cannot conduct any business transactions during the meeting unless it meets the quorum requirement.

Proxies

A proxy is a person appointed by a member to attend the company’s shareholder meeting and vote on behalf of the member. The proxy doesn’t need to be a member of the company.

As stated by the Companies Act, a member cannot appoint more than two proxies to attend and vote in the same meeting. Therefore, if a member selects two of their proxies, the appointment becomes invalid unless they determine the proportion of their ownership to be represented by each of the proxies.

Special Notice

Shareholders, under certain circumstances, have the right to provide a resolution at the meeting. In this case, the shareholders must give special notice of the resolution to the company four weeks before the meeting. The company will send this notice to all members at least two weeks before the meeting.

A special notice is required to pass resolutions for issues such as:

  • Dismissal of Directors; and
  • Dismissal of auditors from the office before their terms get expired.

Shareholder Resolutions

The decisions made by the shareholders of the company must pass a “resolution.” If a resolution is issued in a shareholders’ meeting, it means that the company’s shareholders have approved the proposition suggested by the company.

There are two types of resolutions governed by the Companies Act: the ordinary resolution and the special resolution.

Ordinary Resolution

An ordinary resolution is a formal decision passed by a simple majority (i.e., more than 50%) of the votes cast in a meeting. 14 days of written notice must be given for the meeting. However, meetings can be held at shorter notice if members that hold at least 95% of the voting rights approve. Matters that require the passing of an ordinary resolution include:

  • Dividend declaration;
  • Appointment and remuneration of auditors; and
  • Election of directors (in place of retiring directors).

Special Resolution

A special resolution is a resolution of the company’s shareholders that requires at least 75% of the votes cast by shareholders in favor of it in order to pass. Following are a few examples of matters that require the passing of a special resolution:

  • Changes to articles in the constitution
  • Reduction of the company’s share capital
  • The change of the company’s name

Written Resolution

Written resolutions allow board and shareholder decisions to be made without having to convene a board or shareholders’ meeting. Instead, a written resolution explaining the decision can be circulated to the required audience, with which they can sign and return it – confirming their consent.

Directors’ Meeting

 There are no specific rules for convening directors’ meetings in Singapore, as these are not governed by the Companies Act. However, directors are given the authority to meet and implement business decisions at company meetings.

Requirements such as quorum, notices, etc., are stated in the company constitution. All the rules in the constitution must be complied with by the company.

Responsibilities of directors during a meeting include:

  • making decisions based on the majority vote of the board of directors,
  • voting on any issue without imposing personal interests, and 
  • avoiding conflicts of interest.

How to Convene a Directors Meeting Based on the Constitution

The company constitution has rules and regulations that govern the running of the company. It also consists of clauses relating to the conduct of the Directors’ Meeting such as:

  1. The quorum of the meeting
  2. Chairman to preside over the meeting
  3. Number of votes required for making a decision
  4. Adjournment of the meeting etc.

Notice of the Directors’ Meeting

Like in a shareholders’ meeting, a notice is made and sent by a company secretary. Usually, notices are sent at least a week before the meeting date. The notice must clearly state the date, time, and place of the meeting.

Appointment of a Chairperson

Before the meeting is held, the company must appoint a chairperson of the directors’ meeting who will ensure that the meeting discusses all the agenda items and arrives at a decision.

The company may formulate specific rules in its Articles of Association relating to the chairperson of the meeting. However, in the absence of such a rule, the meeting director will have to appoint a chairperson.

 

Board Resolutions

A board resolution is a decision taken by a company at a directors’ meeting. The company passes the decision at the meeting only if the board of directors approves an issue by the majority at the meeting.

Matters that require a board resolution include:

  • Company bank account opening;
  • Lending or borrowing money;
  • Capability to invest company funds etc.

What if my company fails to conduct statutory meetings?

Your company will be in default if it does not comply with the relevant provisions of the Companies Act in Singapore, one of which is the implementation of AGMs. Such violation may result in your company and its officers being found guilty of conviction. In addition, your company may also be subject to fines and default penalties.

Therefore, you need a competent company secretary that is capable of properly handling your company’s statutory requirements, including AGMs. The good news is that, in Singapore, you don’t have to hire an in-house one. Instead, you can engage our services to ensure your company’s compliance with the Singapore Companies Act as well as your company’s constitution. 

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