SEC Sets Guidelines for Virtual Annual Shareholder Meetings

SEC Chairman Jay Clayton and staff doing what they can to help telecommunications and shareholder proposals. Let’s hope Trump doesn’t shut down the government again.

The Securities and Exchange Commission today said it has published guidance to assist public companies, investment companies, shareholders, and other market participants affected by COVID-19 with upcoming annual shareholder meetings. The guidance is designed to help companies hold meetings, including through the use of technology, and engage with shareholders while complying with the federal securities laws.

Affected parties can announce in filings made with the SEC the changes in the meeting date or location or the use of “virtual” meetings without incurring the cost of additional physical mailing of proxy materials. 

The guidance also encourages companies to provide shareholder proponents with alternative means, such as by telephone, to present their proposals at the annual meetings in light of the difficulties that shareholder proponents face due to COVID-19.

“The SEC staff recognizes that many public companies and other market participants are transitioning to teleworking, virtual meetings and other contingency measures to address health concerns,” said SEC Chairman Jay Clayton.  “Our staff stands ready to facilitate these transitions and we encourage market participants to contact us with requests for guidance or relief.  The SEC has itself moved to teleworking and virtual meetings and remains fully operational.”