Show Notes

Navigating AGMs: Essential Strategies and Tips for NFP Associations In this episode of the Service Game Podcast by onsomble, host Julie Krieger discusses the crucial aspects of Annual General Meetings (AGMs) for not-for-profit associations. She outlines the importance of planning and compliance to ensure AGMs are effectively conducted. Julie elaborates on legislative requirements, constitutional obligations, and the intricacies of member engagement. She also highlights the benefits of utilising online platforms for AGMs and the practicality of pre-meeting preparations, including the involvement of proxies and the management of board elections. The episode emphasises the AGM's role as a pivotal accountability moment for associations to connect with their members and share organisational goals and achievements. Listeners are encouraged to utilise resources like the free AGM checklist and Easy AGM Kit provided by onsomble to streamline their meeting processes. Julie concludes by previewing upcoming resources aimed at onboarding new directors post-AGM.

00:00 Introduction to the Service Game Podcast

00:59 Today's Exciting Topic: AGM Coordination

01:31 Importance of AGMs for Associations

02:05 Legislative and Constitutional Requirements

03:18 AGM as an Accountability Tool

04:32 Formal Nature of AGMs

04:59 Key Agenda Items in AGMs

06:09 Director Elections and Terms

09:27 Special and Ordinary Resolutions

12:45 Member Engagement and Forums

14:36 Constitutional Guidelines for AGMs

16:58 Audit Timing and Preparation

17:43 Creating a Clear Timeline and Checklist

18:19 Preparing Information for the AGM

19:50 Using Online Systems for Your AGM

22:16 Exploring Specialised Voting Systems

24:13 Managing Proxy Voting

27:26 Post-AGM Responsibilities

30:10 Resources and Support for Your AGM

31:51 Conclusion and Next Steps 

Links:

www.onsomble.com.au/resources 

Show transcript

Welcome to the Service Game Podcast brought to you by onsomble. I'm your host, Julie Krieger. For the past 14 years, I've been helping associations to grow and thrive, establishing systems, writing policies and procedures, implementing membership and sponsorship strategies, and more. Setting up operations, undertaking complete governance restructures, developing strategies, and advising CEOs, presidents, and boards.

 

I am driven to support the hardworking people who give their time, heart, and soul in the service of their members and in the pursuit of the greater good.  Join me as we delve deep into this innovative, creative, values based and mission driven thing. I call the service game.  Let's get going with today's episode.

 

Hello. Hello, and welcome to episode two of the service game by onsomble, where today the exciting topic of AGMs is upon us and specifically, how you can take the hard work out of coordinating, planning, and then running.

 

It's pretty exciting stuff and not at all dry.

 

Maybe.  Anyway. Okay. So on with today's episode.

 

First thing I want to touch on with regard to AGMs is that every not-for-profit association has one every year. They happen, as the name suggests annually. So it's an activity that comes up again and again, and it's important, therefore to get your planning right, so that each year as your AGM is approaching, there's no sense of panic. There's no sense of dread and you can just get on with the important business of running your meeting.

 

So why are they important? Well, firstly there's legislation that dictates that you must have one. So if you are a company limited by guarantee. That is, you're nationally incorporated under ASIC or the ACNC, for example,  you will be governed by the Corporations Act. And that dictates that you need to have your AGM. Penalties can apply if you don't. So there's definitely.  a stick, if not a carrot I suppose. You'll also find that you've got your constitutional requirements to hold an AGM and your constitution will very specifically cover what is required of you in terms of hosting your AGM, what it means to your members, how you should hold them, when you should hold, and what should be involved.

 

All of those sorts of details. And again, you constitution being your main governing document lays out really clearly all of these terms and conditions. And you can be held responsible if you don't adhere to them, so it's important to do it and it's important to get it right.

 

The third point that I'd make s that your AGM is actually a really great. Opportunity, possibly the most significant one you have to be accountable to your members, to give your members visibility of what the people who are in charge of the organisation are doing.  And what has happened over the previous year, what's coming for the next year, what you're doing with the dollars that they are investing into your association.

 

And it obviously gives them an opportunity to have their voice on key issues. I don't necessarily mean a literal voice, although you will probably hear from some of them, at least during the meeting.  But in terms of anything that's fundamentally likely to change.  That will be brought to your AGM in the form of a resolution of some kind that the members can then vote on. So it's a really important opportunity to connect with your members, to keep them posted about what's going on, to get their buy-in and their approval for the activity that you want to undertake as well as who will be leading the organisation in the form of director elections. 

 

So to the purpose of an AGM.  They are different from your average meeting, held within the organisation. Obviously they're only held once a year. But they are also by nature, much more formal than most other meetings you'll have.

 

For the large part, the agenda will be dictated by the contents of your Constitution and the clauses that it contains related to your AGM.  Typically an AGM will include items such as approval of the minutes from the previous. AGM.  So they get taken at an AGM, they get reviewed immediately following that by your board, for example, or your chair at the very least. for accuracy  and correctness, proofreading. et cetera. And then they kind of go away for the rest of the year until it's time for your next AGM. And then those minutes are brought forward, put to the membership and approved or accepted as a true and accurate record of that previous meeting.

 

So that's one of the items on the. Agenda.  And agenda for an AGM will also include reports on key activity that's been undertaken in the preceding year. So ,for example, your CEO or your executive officer might give a report. Your chair or president certainly will give a report.  You'll have financial updates and reports including the auditor's report - If the audit is something that you are required to do. 

 

You can also take this opportunity to vote in elected directors. Not necessarily all directors need to be elected at an AGM, but most typically will be, unless they are, for example, an invited director - hat is a director who has say a special skillset, that may or may not be related to the industry that you’re serving, but is relevant to the board and the effective governance of the organisation. If your constitution allows invited directors, then those Directors simply have to be invited to join the board by the members of the board. And they can be brought into the board at any point throughout the year - completely unrelated to the AGM process and certainly unrelated to the requirement for a vote. 

 

The other thing to note about directors and voting is, of course not every director's position will spill – will all come to an end at each AGM. And again, then we refer back to your constitution. And each organisation’s constitution will dictate the terms of directors’ service.

 

So, for example, your constitution might allow for directors to serve an initial three year term. and then they have the option to serve a second three year term, and at the end of that process, they need to step down altogether. So, obviously if a director under that circumstance has served one or two years of their initial term. They don't need to be re-elected. Sounds pretty obvious, but it's something that can be quite tricky to keep track of. And I would definitely recommend that some sort of system is set up in place to manage when your director's terms are due to end and when you need to start looking for new directors, whether they be invited or elected directors.

 

Of course, any change to the constitution will be on your agenda.

 

So, if you're looking to make a change to any of the clauses within your constitution your AGM is the opportunity to do that. And those are significant changes in the life of an organisation. Because of this significance. I would strongly advise that consultation takes place with the membership well ahead of your AGM, if you're looking to make significant changes to the key governing document of the organisation - the constitution.  It definitely pays to over-communicate versus under communicate on this front.  And this can take the form of newsletters. member focus groups or simple email communication with your membership.

 

Once you've got to a point where you're clear on what those changes need to be and you're confident that you've networked the ideas and socialize them as they say, then you can put those proposed changes to the membership to vote on at an AGM .  And they will, at that point in time, be voted on in the form of a special resolution.  So, a little word about resolutions.

 

There are two different types. There's a special resolution and an ordinary resolution. And these can be somewhat confusing, but they're actually. Fairly simple when it all boils down.

 

An ordinary resolution is used when you want the members to vote on something that's pretty simple and relatively immaterial in terms of the impact that it has on the organisation. So, for example, if you are putting forward the minutes from the previous AGM to be accepted as a true and accurate record of that meeting, that would be voted on by way of an ordinary resolution. And the way that works is that a motion is put before the members at the meeting. Somebody needs to then second that motion, and then a vote takes place. And a percentage of the members present - who are eligible to vote - need to vote Yes to accept that ordinary resolution in order for it then to be deemed to have passed.  So ,in the case of ordinary resolutions this will typically be 50% of eligible voting members who are present at the AGM, or who have voted via proxy if that's permitted under your Constitution and we'll come to proxies shortly.  In the case of a special resolution, these are generally reserved for issues that are much more material in their impact. So, for example, if you want to change terms and clauses within your constitution, if you want to, for example, introduce a new membership category or change the name of the organisation or add a new clause that says for example, Members who serve on a committee will get free membership - those sorts of changes are material enough in nature that they would need to go before the membership at the AGM to be voted on by way of a special resolution.  And because they are more material in nature, typically, they will require a yes vote of 75% of the eligible voting members who are present or voting by proxy.  So it's a higher hurdle to jump and it should be, because it is a more material impact that is being potentially created by the passing of that resolution.

 

 

 

So those things are generally outlined as the key business items of an AGM. Now you can choose to add others if you wish, but typically because of the formal nature of a meeting like this that's where the agenda stops.

 

So that begs the question then - where is the opportunity for members to engage in active, robust discussion and debate with the people who are leading their organisation? 

 

And the answer to that, or at least one of the possible answers to that is to hold a members forum immediate following the AGM. And by immediately I actually mean, the chair will formally bring the AGM to a close and straight away open a second meeting,  which will be called the members forum.  So, for example, you might go through the standard business of your AGM, you'll have some opportunity for questions and answers  from members present to inquire about any of the issues that have been discussed as part of the agenda.  But that's it.  No further items will be discussed or debated. No conversations will be had regarding outside issues that aren't specifically in the agenda of that meeting. So it's a pretty narrow definition and a narrow focus for this particular meeting. As I said, quite formal.  So typically the way around that is once the AGM is called to a close the chair will then open immediately a member forum. And that is, as the name suggests a much more relaxed and casual environment and atmosphere for members to be able to voice concerns, have more of a flowing free form discussion, potentially get into some of the more contentious issues within the organisation,  the board, interrogate activity in a more granular detail, that kind of stuff. So it's really about conversation at that point. Whereas the AGM is not, it's really much more structured, much more restricted in its scope, and much more formal.

 

So the key elements of an AGM: We've already discussed that your constitution is the main point from which you'll pick up information about what's required in your AGM. So you really should delve deep into that as step number one, to understand what's required to terms and conditions of hosting the AGM.  And all of the other aspects of director elections, special resolutions, ordinary resolutions. Et cetera, et cetera.

 

Most of that information, if not all, will be handled in your constitution. So that's step one. And the key element number one.  It will also tell you things like whether you can hold the AGM via an online platform or you need to have it face-to-face.  Typically, they're worded in a somewhat flexible fashion to allow you to make that choice, but not always.  So if you've got an old constitution that hasn't been updated for a while you might just find that it still dictates that you call your AGM as an in-person meeting.  And now if that is the case, I would say it is a perfect example of the type of change to your constitution that you might seek to make at your next AGM!

 

Again, then the constitution will show you what's meant to be in your agenda.  And of course it will give you all of the details around what you need to do to make sure that your AGM is compliant with your requirements as laid out in the constitution, as well as, to some extent, by law, whichever one governs your body. But things like the notice period ahead of the AGM by which you must give notice to members of the meeting - it's usually somewhere between 21 and 28 days. It'll also tell you how many eligible members make up quorum at the event. So if you don't get that minimum number of eligible voting members in attendance, then the meeting can't go ahead - other than to set a new date for the AGM. It will also tell you about the voting process.

 

The next element of course is planning. So, you need to look firstly, at your audit timing. And that is something that really needs to be tackled as far ahead as possible, at least a few months. Because you need to lock in your auditor. You need to get them scheduled, prepare all of the information that they will need to do the work they're going to do. And that can take time. So, it's definitely a tripping point that people find they come to plan their AGM and then think “Oh, no.” We were meant to have had the papers out next week.  But we haven't spoken to the auditor.   That's a big problem at that point. And you need to call in some big favours to get that handled. That is. Of course assuming you are required to conduct an audit.

 

The planning will also involve you making a clear timeline and checklist of all of the activities that need to happen in order to make the best of your AGM and get the most out of it.  And of course, to make sure that you are compliant.  So you can go ahead and plan these things, plan things like your voting platform and so on well ahead of time, even if you're not yet ready. To launch it out to your members.  And you actually should take that opportunity to get ready as far ahead of time as you possibly can.

 

 As well as planning, you can go ahead and actually start preparing some of the information ready for the event. So for example, your PowerPoint template, start writing your reports ready to add detail in as it becomes available, write up the wording for the motions that you will be voting upon at the meeting, get your proxy forms ready. Get all of the supporting information ready as far ahead of time as you can. And this is particularly true if you're going to try and get a significant change through at the AGM or even one that isn't that significant. But it's going to be important, as I mentioned previously, to communicate with your members ahead of time. And that includes providing them with the supporting information that lays out your arguments for the change. It puts a logical case forward to them and that provides them with answers to the questions that you perceive they might come up with on the day if they didn't already have this information. That kind of work can be done in advance because you're going to know exactly the rationale behind the changes you're trying to get through ahead of time. So get on the front foot and plan all of that information well ahead. So that you can provide it to your members as well as relieve some of the stress of the whole process.

 

Assuming your constitution allows you to run your AGM via an online system, there are plenty of online systems that you can use to run your AGM. Probably the most simple of them is something like a zoom account. Most organisations will have a zoom account or a Teams account. Or a Google meet, one of those sorts of platforms. And they are quite sophisticated and will allow you to run online polls for voting, et cetera. They will mostly also allow you to have people pre-register for the event. You can delve into the backend of those systems to set them up according to your requirements. And according to the requirements dictated by your constitution.  So that will allow you to have a bit more control over who can enter the meeting. Control over when you send the links out for joining the meeting, control over other people's - attendees ability to be seen or heard during the meeting, depending on the way that you set it up in the backend. Typically with those systems, you can invite anyone who's going to be presenting during the meeting via a separate link specifically for presenters.  That means when they enter the meeting they'll be entering into what's known as a green room or a sort of holding room, if you like.  They're not in with all of the other attendees of the meeting and therefore you can set different permissions for them for the duration of the meeting. So, for example, if you want them to be seen on screen the whole time you can set that up accordingly.   If you want them to be able to present and speak they can do that too. And also importantly, to share their screens. So it's really useful for people who will be presenting reports during the meeting. And those systems have that kind of functionality.   And they are for the most part more than adequate. 

 

Depending on the numbers you have in your membership and the numbers that you expect to attend the AGM, you can run those sorts of meetings as part of your regular  subscription to one of the platform.  So it need not cost you a fortune.

 

With the likes of zoom teams, Google Meet, WebEx.  et cetera, they are more than adequate.  However, there are systems out there that you may want to explore as well. So there are systems like Election Runner. And there are plenty of others of that ilk. If you do a Google search, you'll find them quite easily and I'm not affiliated with any of them. But you can use any of those and they are designed specifically for this purpose. And in most cases, specifically for the not-for-profit association. And elections for organisations like it.  They are out there. You don't need to spend the money on them. But you might find that they've got some functionality over and above what you might find in something like zoom or teams.  And that is appealing to you. So using those systems, you can enter all of the details of your directors, the elections, you can load ahead of time the motions that you're going to vote on,  and set them up really just so that they're ready to rock and roll knowing of course, that because this is a formal meeting and because things don't tend to change a lot. You're going to be set pretty well from early on in the organisation process.

 

You can also open up the voting as and when you wish.  So depending again on your constitution and what your process is, you might want to open up voting ahead of the AGM and let your members jump into that platform to cast their votes for say, director elections or to vote on resolutions. And again, check your Constitution to make sure you can do it that way. But if you can, you might want to do that, and it definitely saves some of the headache that that can potentially arise on the day.  Otherwise you might just open it up once the meeting has begun and at the appropriate moment within the agenda for the meeting itself.  So again, check your constitution for all of that.

 

Similarly it's worth checking your Constitution again. To determine whether or not you can allow proxy voting.  In most cases it is likely to be allowed.  But it may not. Definitely one of those elements that you need to check and definitely check early in your planning process.  So proxy voting effectively just means that an eligible voting member who, for example, can't attend on the day of your AGM can choose another member and allow the eligible voting member to vote on their behalf.  In doing so they can have one of two options. They can either allow that other member, their proxy, to vote as the proxy sees fit. Or they can specify the way they want to vote and the proxy will submit that vote on their behalf.  Sometimes this can also be done ahead of time via electronic means.  And also via paper submissions.  Either way you will need yourself a proxy form. And that will ask for the voting member’s details, the details of the person they're appointing as their proxy. Sometimes there can also be a box -  rather than specifying a particular member, they might simply specify “I give my voting right to the chair”. And in that case, the chair can vote on behalf of that member as the chair sees fit.

 

You'll need to establish a system of course, to manage the proxy votes and to make sure that the people who submit them are indeed eligible to vote at the AGM, and it will also require that the person being nominated to act as the proxy. Is also an eligible voting member. 

 

At the end of each voting process the votes will be tallied, or you can do them all at the end. If you're using an online system, you will be able to press a button and that will calculate the response, the results and show you the percentage of votes for, against, or abstaining, which are the three options typically used. And you will get real time instant results to any of the votes.

 

So an AGM is a fairly dry kind of activity in the annual calendar of a not-for-profit association. I'm not going to kid you about that. It definitely is. It's pretty structured. It's pretty formal. And it's one of those things that you need to do from a compliance point of view as much as anything else. But don't forget that it is also a key opportunity to demonstrate to your members what is going on behind the scenes, if they're not generally aware of it through your other means of communication. This is your key accountability moment with your membership. So it's really, really important that you share with them the information that they need and want, and that you were required, of course, to share with them.

 

Don't forget that after the AGM has been held, there are certain things that you also then need to go and do. That will include communicating with your members, first and foremost. Not every member will have attended your AGM.  Absolutely guaranteed. So you're going to need to prepare something to go out to members post the AGM that fills them in on what happened, the results of all of the votes, details on any new board directors and an outline of who the board is now made up of. It’s always helpful and always great from ad accountability point of view. So it's definitely worth it, and you can pre-prepare a lot of that information ready to go out the day after the AGM, then just slot in the results of the various votes and polls and election and so on.  So that's definitely, honestly, something really important for after the AGM. Don't forget also that in terms of compliance, should you have voted in any changes to your constitution, you will need to submit that constitution with your governing body. So, whether that's the ACNC, ASIC, or your state-based organisation, you need to submit any amendments to your constitution to that body for their records. And you have a timeline in which to do that. So it's worth acting on that fairly quickly. Likewise, if you have had any changes. Changes in your board, you will need to update those. And I know for the likes of ASIC, you've got about 28 days to do that, to update your office bearer positions and your board. If you don't do that within 28 days of changes being made, there are penalties in the form of fines. So definitely worth following up those elements after the event.

 

So, yep, there's a lot to it. It's a detailed compliance formality. But the good news is the steps are replicable year on year. So, if you do the leg work this year and you set it up well and you keep records well, and you have great templates and structure around what you're doing, the process year on year will become more and more straightforward and less of an issue in terms of knowledge transfer, should your team change in the meantime. Or, you know, should you need to train up anybody else in the processes that you've been employing.

 

So don't forget that we have your back in all of this work.  We have created for you a free downloadable Easy AGM Checklist document, which you can find on our website, which is onsomble.com.au/resources. That's O N S O M B L E.com.au/resources to find that Easy AGM Checklist that you can download for free. It gives you an opportunity to add in the dates for each of the elements that you need to undertake. And then tick those boxes.

 

Once they're done, you can then clear that and save it away for next year. So it's reusable and it covers all of the steps that are typically undertaken in the planning and running of an AGM. And it runs from three months out, two months out, one month out the week of, and the day of, and then post the AGM as well. So it's pretty comprehensive.

 

If you like that and you want some more help, we also have an Easy AGM Kit, which contains a whole heap of instructions as well as a series of templated documents that you will need to run an effective AGM. Things like, for example a templated proxy form, Notice of meeting, chair’s powerpoint presentation headings.  So it's a great resource that you can download from that same location, onsomble.com.au/resources.

 

And of course, if you need help, guidance, Board advice or consultation of any other kind, you can contact me via [email protected]. That's T H R I V [email protected]. 

 

And stay tuned. The next logical activity for not for profit associations is of course to effectively and thoroughly on-board your new directors after your AGM. Super important step. And in the next weeks we will have our Director Induction kit uploaded onto our website in that resources area for you as well.

 

So you'll hear more about that as that goes live. In the meantime thanks for listening in and we'll chat next time.  

 

Thanks for listening to the Service Game Podcast by onsomble. If you enjoyed this episode, please like and subscribe and write us a quick review. It helps us to reach more people and we really appreciate your support.  To access our downloadable resources and tailored support options designed for NFPs, head to onsomble.com.au.  Or look us up on social media. You'll find all our links in the show notes for this episode. Chat next time.