2 minute read 4 Sep 2020
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How you can reimagine corporate governance while remaining compliant

Authors

Stephen d’Errico

EY Global Corporate Law Leader

Leads Corporate Law globally. Heads Corporate and Regulatory Services Group of Ernst & Young Tax Advisory Services S.a.r.l.

Mike Fry

EY Global Entity Compliance & Governance Leader

Global leader focussed on developing an exceptional client experience through a managed services model that incorporates innovation, automation and analytics.

2 minute read 4 Sep 2020
Related topics Law

Organizations have an opportunity to evolve traditional corporate reporting as they look beyond the COVID-19 pandemic.

Three questions to ask
  • In which jurisdictions can boards and shareholders reliably hold virtual meetings – and produce virtually signed resolutions?
  • Which deadlines have changed for company filing and annual shareholders' meetings?
  • Has COVID-19 changed local rules regarding remote board or shareholders' meetings?

As we move to the “beyond” phase of the COVID-19 pandemic, multinational companies are trying to understand their immediate or pending obligations in a number of areas. Over the last few months, there has been a number of legislative and regulatory changes in the areas of corporate reporting deadlines and remote attendance at board and shareholders’ meetings.

EY’s Global Corporate and Commercial Law post-COVID-19 Deadline report has been produced to help legal teams understand the position around the world in relation to three pressing obligations:

  • Meetings - Whether board meetings and shareholders’ meetings may be remotely held
  • Annual accounts - Timeframe for approval and publication of annual accounts (if any)
  • Execution - How can the resolutions from such meetings be executed (“wet ink” or digital signatures)

We settled on these three obligations as we believe that these will present organizations with the best opportunity to reimagine their approach to corporate governance. The impact of the COVID-19 pandemic has meant that, when it came to corporate reporting, in many jurisdictions the regulatory authorities were forced to make allowances for delays and provide alternatives to existing procedures.

Our report highlights the widespread adoption of remote working, videoconferencing and e-signature technology during the COVID-19 pandemic. We note from our report that regulatory authorities around the world have now accepted that these innovative forms of corporate reporting are equally as valid as traditional practices. This presents an opportunity for organizations to think carefully about what they wish to achieve from each board or shareholders’ meeting and how transparent they wish to be in their reporting.

Many organizations are experiencing increased scrutiny from stakeholders on a number of fronts – such as leadership, good governance, profitability – as we approach 2021. While digital transformation provides a number of opportunities to increase resilience, we believe that transforming the legal and corporate secretarial functions should not be viewed primarily from a cost reduction perspective. As our report shows, there is a great opportunity to reimagine how the organization treats corporate reporting deadlines as part of achieving its wider strategic goals.

It should be noted from the Global Corporate and Commercial Law COVID-19 deadline (pdf) report that a number of jurisdictions did not extend annual general meeting and annual accounts filing deadlines, despite the COVID-19 pandemic, and therefore organizations risk being in breach of the law if they don't manage to comply in time. In these cases, organizations will find the report useful as it provides unambiguous guidance on a country-by-country basis in over 65 jurisdictions. 

Summary

EY’s latest global report outlines the position on board and shareholders’ meetings, annual accounts and digital signatures in more than 65 jurisdictions, providing the starting point for reimagining corporate governance.

About this article

Authors

Stephen d’Errico

EY Global Corporate Law Leader

Leads Corporate Law globally. Heads Corporate and Regulatory Services Group of Ernst & Young Tax Advisory Services S.a.r.l.

Mike Fry

EY Global Entity Compliance & Governance Leader

Global leader focussed on developing an exceptional client experience through a managed services model that incorporates innovation, automation and analytics.

Related topics Law