Annual General Meetings are formal affairs where I’s need to be dotted and T’s crossed, and as the name suggests, they are held annually.
Under most constitutions an AGM is a General Meeting although the definitions can sometimes make this a little unclear. All meetings of the organisation are general meetings unless they are extraordinary or special general meetings and have their own special requirements.
It is important to remember that an AGM is another version of a general meeting though specific matters, which are only dealt with once a year, form the agenda.
AGMs are usually held within 5 months of the end of the financial year. For entities using a financial year to 30th June this means that the meeting must be held by the end of November.
Zhuzhing up your AGM
Many people groan when they think of their club or association AGM. Boring, dull, waste of time, can’t we do this on line, I’ve got better things to do and every epithet under the sun.
The secret to a successful AGM, that people attend, is to sandwich it between other activities which are interesting, enjoyable, social and fun.
One idea is to run a forum of some sort before the AGM. Depending on your sport you may have a forum about, for example:
- how to increase the number of women playing,
- the effect of concussion,
- how to manage bad parent behaviour,
- ideas about fundraising,
- the latest news from your state sport department,
- a speaker from your National Sport Organising on success at the last world championships,
- a panel chat on good governance and what it means.
There is any number of topics that will attract members and interested parties. Aim to make the AGM itself done and dusted as quickly as possible noting that elections and constitution change might take up some time.
Then finish the event with a social activity: lunch, drinks and nibbles, including good networking time. And don’t forget nametags which always make the conversation flow that much more easily.
Publish the program well in advance so as to encourage people to come and stay because it’s presented as an occasion worth attending.
The AGM Agenda
The agenda usually contains the following elements
- Welcome and apologies
- Minutes of previous AGM
- President’s report
- CEO’s report (if applicable)
- Presentation of Financial reports
- Constitution amendments (if any)
- Elections
- Life Memberships (if any)
- Appointment of the Auditor for the next financial year.
There is usually no general business item on the agenda though it can be included to encourage discussion amongst those who have given up their time to attend.
The agenda for an AGM can sometimes be a very speedy affair especially if there are no or few elections. It is often worthwhile considering having a speaker come along and talk on a topic of interest whether it be someone who has successfully represented your sport or club, someone who can talk about governance (always a crowd pleaser!) or perhaps some thoughts on marketing and strategic planning at a high level, for the benefit of everyone whether on a club committee or sport association board.
Who attends AGMs and who has the right to vote
Attendees at AGMs include the directors of the organisation, its members including life members and any guests who may be invited.
Only voting members may vote at AGMs. For most sports bodies the voting members are, for clubs their members, for state sport associations, their member clubs, and for national sport organisations, their member states in an ordinary federated model. Individuals who are members of clubs are not entitled to vote at their state association AGM unless on behalf of their club. Life members are not entitled to vote but are usually, as of right, entitled to attend and to speak.
It is up to the board to decide who, other than voting members, is entitled to speak at AGMs. In order to encourage attendance at what most people usually think of as a very boring way to spend one’s time, a decision may be made to allow any interested person to speak on a topic though the vote remains with the voting members.
The directors or the organisation will attend, may speak but usually do not vote.
The Minutes of the previous AGM
The minutes of the previous year’s AGM are presented for approval at the next year’s AGM. They are not presented at a board meeting or any other general meeting.
When a motion is put to approve and second the minutes only people who were present at the previous AGM can move and second the minutes and only those in attendance at the previous AGM can vote to accept or approve the minutes.
It is uncommon to send draft minutes to those in attendance at the meeting, in the manner of draft board minutes being sent to board members within a week or two of the board meeting. Rather, the draft minutes are sent with the notice of the next AGM which gives anyone who wishes to, time to revise the draft minutes and then raise any missing item or error at the AGM itself.
The Annual Report
The AGM is the meeting at which the Annual Report and the Annual Financial Report are submitted to the membership for approval. Here, we will focus on the former as the latter more or less takes care of itself through the audit process – see Notice of AGM.
The Annual Report is a report for the previous financial year. For most organisations it will be for the period from 1st July to 30th June which means by the time the AGM is held (by the end of November) much of the information will be quite old.
The Annual Report serves a couple of purposes. One is as the formal record of the organisation and the second as a marketing tool. Both these purposes should be kept in mind when preparing it.
There is no right or wrong formula to the preparation of an annual report but every effort should be made to make it as interesting and readable as possible. For instance, if you have just installed a new computer system it may be worth a line or two but definitely not a whole half page. On the other hand, if you have held a marvellous awards dinner with some great stories and great winners then a double page spread, with photos, might be appropriate. After all, everyone likes seeing themselves in photos at events.
Subcommittee and working group reports should be succinct and edited to read in the same style - written in either the first or third person so as to not confuse the reader and to give a sense of cohesion to the document. It is appropriate that specific reports be authored by the subcommittee chairman.
The annual report should contain, as a matter of record:
- The President/Chairman report
- The Secretary/CEO report – sometimes it is appropriate for these two to be combined
- Board members, including any changes in personnel during the period
- Staff, including changes
- Subcommittee and working group members
- A summary of the strategic plan’s progress
- Awards dinners and other social events with photos
- Results from competitions
- Programmes and projects run by the club/association
- A list of members by category or class
- Thanks to and acknowledgement of sponsors and supporters
- Anything else that is relevant to your organisation
Make sure that it is designed and printed not only for the AGM but also for distribution to stakeholders, friends, politicians, local councils, sponsors, potential sponsors, and people who didn’t attend the AGM. Send it to these groups with a carefully written cover letter signed by the chairman and/or CEO. Whilst it might be more expensive an exercise than simply putting a flip page version on your website there is a much higher chance that a hard copy will be kept and read, so consider the investment.
Some organisations send their annual reports to the various interest groups prior to the AGM. However, there is a very slight risk that the President/CEO report/s may be challenged at the meeting. If that did occur then it would render the published documents incorrect if those reports were required to be amended.
Appointment of the Auditor
Each organisation would usually have an independent firm of accountants to conduct an audit of the annual accounts. These are signed off by the board before presentation at the AGM.
It is a strange protocol but it is usual for a motion to be put to the meeting to confirm the appointment of the auditing firm for the next financial year or to appoint a new firm should that be the recommendation of the board. Appointments of auditors are renewed annually.
Notice of AGM
The Constitution will usually prescribe the time period in which notice of an AGM is to be given. The standard number of days is 21 or 28 but sometimes, depending on the nature of the organisation, it may be up to 45 days.
Notice periods are critical and must be observed and adhered to. Notices must be sent out not less than the number of days specified. It doesn’t matter if the notice of meeting is dated 21+ days ahead of the date: it must be sent by the date. As email gives a specific time it is sent then there can be no doubt. Challenges to the validity of meetings can be mounted if the time schedule is not adhered to and, if successful, can mean that the whole meeting process needs to start again. Motions to cure an invalidity such as insufficient notice may prove problematic even if that is the most expedient solution.
A fixed number of days may not suit every purpose. 21 days’ notice to the membership may be fine but in order to have nominations for elected positions in hand the closing date for those may be 28 days so that the details can be included in the papers sent out with the notice of meeting. Or the notice of meeting may be 21 days but the date on which nominations are sent out is not less than 7 days before the meeting.
To ensure that those compiling the paperwork for AGMs have enough time to receive the information and documentation they need and then process it for distribution to those attending the AGM think carefully about the various dates prescribed.
Board members seeking re-election
Board members whose terms are up need to make a decision about whether to re-stand for election or not in a timely manner and not at the last minute.
Delaying a decision about whether to seek another term puts the organisation at a disadvantage in that it may prevent other people who may be interested from putting their hands up. Quite often people don’t wish to contest an election if they know an incumbent is re-standing, preferring to wait for another opportunity.
As AGMs are usually held at the same time every year, give or take a week or two, discussions ought to be held by the board in the middle of the year about who will and who won’t be seeking re-election. If an early declaration is made then vacancies can be declared to the widest constituency giving those who might not want to challenge an incumbent the chance to consider nominating. This won’t be possible if the incumbent leaves it to the closing date for nominations to make a decision to not contest the election.
Amending the Constitution at the AGM
Sometimes constitutions require wholesale overhauls involving a total rewrite. Other times there are clauses here and there needing only a tweak. In either case change is made most usually at an AGM or, if particularly urgent, at a specially called Special General Meeting.
(A Special General Meeting or SGM can be called by the board or by a certain number of members, as per what is set out in the constitution, for a specific purpose only; that it, one agenda item. In this case the motion to be put at an SGM would be “that the 1919 constitution be substituted for the 2018 constitution” and discussion, and a vote would then follow).
Constitution change takes time for a number of reasons. People don’t like change. They think the constitution works perfectly well. They don’t understand its deficiencies and its lack of best practice. They don’t understand what the change is for or what it means.
Bearing this in mind you need to give yourselves, as a board, plenty of time to deal with and negotiate change. Get independent people who know about drafting constitutions involved. Don’t rely on members of the board to work as a committee to draft amendments. Pay someone to do the job for you and to manage the consultation process with stakeholders, objectors, interested parties and the disinterested ones, too.
Once the process is concluded a motion or motions need to be put to the AGM to adopt the constitution. The board and/or CEO drafts the motion.
The final draft, ideally in marked up form, ought to be sent out with the AGM papers (in accordance with the time limits set out in the constitution) accompanied by an explanatory memorandum going through each amendment one by one giving the reason for the proposed change. This will give those who are interested time to make queries before the AGM itself leading to, fingers crossed, the smooth adoption of the new and improved constitution at meeting time.
Most often this is done by one motion, called an omnibus motion, which incorporates all the changes. This can be done by providing a list of the changes to the meeting or alternatively with a marked up copy of the changes. The latter is less desirable as it can be confusing if there is substantive change.
Be aware that technically every change needs to be identified even if it is a change from a capital letter to a lower case letter, or to remove a typo and fix spelling and grammar errors. It is up to you to decide if you wish to go to this detail.
The alternative is amendment by amendment which is both time consuming and likely to generate a whole raft of objections from people who’d otherwise been sufficiently satisfied, or reasonably so, to pass the changes.
There may be some tweaks here and there to some of the wording but assuming that a final version is accepted the motion needs to be put to the meeting. A vote of 75% of those present and entitled to vote is required to pass the amendments or the adoption of a new constitution, as the case may be.
Mostly most people aren’t that interested in constitutions and more often than not changes are adopted without any dissent, debate or dispute. Nonetheless it pays to have ensured that everyone possible is consulted in the lead up to the preparation of the final draft to avoid change being derailed at the meeting. Having said that, it is possible for mundane changes to pass leaving more contentious issues for further debate and discussion outside the AGM. Further changes will then need to be presented at an SGM or the next
