The outbreak and spread of coronavirus has put real pressure on all aspects of human life including the functioning of our corporate governance framework. In order to support directors over this period, the Institute of Directors would like to see urgent temporary measures implemented relating to board decision-making, company reporting and AGMs. To give directors the flexibility they need, UK regulators should implement three sensible measures that take account of the radically altered environment.

Permit virtual board meetings

Firstly, boards should be given the flexibility to make legally valid decisions while maintaining social distance. Whilst emergency public health measures remain in place, virtual board meetings facilitated by teleconferencing should be permitted regardless of whether allowed for by a firm’s constitutional arrangements. Further, in these exceptional times, boards must be permitted to make binding decisions through the use of written resolutions.

Extend reporting deadlines

Secondly, all deadlines around the publication of financial accounts, annual reports, viability statements and other statutory reporting requirements should be extended or suspended in light of the crisis. The pandemic has clearly limited the ability of finance teams and external auditors to sign-off on the statutory accounts relating to last financial year. It’s also clear that many boards will be limited in their ability to make meaningful statements in their annual reports or other disclosures about the impact of the virus on their future performance or viability in the current circumstances.

Allow new AGM arrangements

Finally, organisations need to be granted the ability to alter the date and location of their AGM at short notice or to postpone their AGM until after crisis. Large-scale gatherings of shareholders and company officers are clearly inappropriate at this time and may even be something of a distraction. More informal channels of communication between stakeholders including shareholders are likely to be far more appropriate.

If implemented this sensible package of measures would give directors the ability to better respond to the crisis. Indeed, such measures have already been implemented in some jurisdictions, including in Spain. Regulators across the world should look to emulate these pragmatic approach to allow business to continue in these extraordinary times.