Date: February 17, 2003
We have today met with a representative of Council on Corporate Disclosure and Governance (“CCDG”) and made representations to urge the council to seriously consider making SIAS’ call to public listed companies to maintain minutes of General Meetings to reflect substantive comments and queries by shareholders and the responses by the Board and Management as a requirement or at least as a best practice in the Corporate Governance Code.
Members of SIAS, who have attended company Annual General Meetings in the past and recently, have brought to our attention that many listed companies maintain the barest record of their general meetings. Such companies essentially minute only the resolutions that have been passed or defeated. The minutes do not include any account of the comments and queries by shareholders or the responses by the Board and Management. “Meeting Minutes” is defined by Longman dictionary of contemporary English as “an official written record of what is said and decided at a meeting”. Members complain that many companies refuse to record even the gist of relevant questions asked by them and answered given by the Chairman of the meeting.
Especially in the current environment of greater shareholder participation at general meetings and the emphasis on greater transparency and disclosure, SIAS finds this practice of keeping skimpy minutes to be totally unacceptable. Not to record comments or queries from minority shareholders represents total disregard for and disrespect of minority shareholders. It expunges whatever they have said from the institutional memory of the company. It is as if they never said anything at the meeting, as if they are to unimportant to say anything worth recording.
Some companies have given the excuse that they have been legally advised that their practice of maintaining scanty minutes is in line with the practice of many Singapore-listed companies. We are not talking about minimum legal requirements but rather about good corporate governance. We believe that keeping proper minutes and having them accessible to all shareholders are in line with good corporate governance.
Another excuse is that it is too inconvenient to produce more detailed minutes. However, we know that companies keep much more detailed minutes of board and other meetings. Associations and clubs also routinely keep very detailed minutes. As to what is the appropriate degree of summarization and what is substantive, we are confident that the discretion can be left to the company secretaries, who are not only capable of professional, but are also able to keep the interest of all shareholders of the company in the forefront at all times.
Some companies apparently take reasonably detailed notes of the proceedings and in that sense they may be taking into consideration the comments by shareholders. However we are of the view that such notes are inadequate since they do not represent the formal record of the meetings and are not available to shareholders. Instead we urge such companies to convert their notes into minutes so that the information is placed on official record and is available to shareholders.
SIAS feels strongly that companies should record minutes to reflect the actual proceedings of the minutes. To do so will enhance not only accountability but also good corporate governance and transparency.
SIAS therefore urges all listed companies to maintain minutes of general meetings that include, in summary, substantive comments and queries by shareholders and the responses by the Board and Management.
Mr David Gerald J.
President & CEO
Securities Investors Association (Singapore)