The meetings of a Maltese company: How critical is the company secretary’s role?

Dr Monica Galea John is a partner within the Commercial and Corporate Department of Fenech & Fenech Advocates

This is the fourth and final part of a series of FAQs regarding the office of the company secretary in terms of the Companies Act (Chapter 386 of the Laws of Malta). This article will explore the role of the company secretary with respect to the meetings of a Maltese company.  

What type of meetings are we looking at?

The meetings of a Maltese company could be either (i) meetings of the board of directors (and/or its committees, if any), or (ii) general meetings of the shareholders (including class meetings).

In terms of shareholders’ meetings, every company must, each year, hold a general meeting as its Annual General Meeting (AGM) in addition to any other general meetings (referred to as Extraordinary General Meetings) to be held during the course of that year. If the AGM is not held, every officer of the company (including the company secretary) is liable to a penalty and for every day during which the default continues, to a further penalty.

How does the company secretary fit into the law of meetings?

The company secretary has a number of duties pertaining to meetings generally and he/she is often relied upon by the directors and the chairperson for the organisation of said meetings.

Prior to any meeting, the company secretary is tasked with the following matters (which we have already touched upon briefly in the context of the duties and obligations of the company secretary provided in the second part of this series of FAQs), namely:

1. the preparation of the agenda – This naturally requires consultation with the board/chairman and/or shareholders before-hand (as applicable, depending on whichever meeting is going to take place), so as to determine the matters requiring discussion/resolution at the meeting, and to be therefore included as items in the agenda;
   1. the circulation of the notice and agenda to the persons entitled to attend the meeting. The agenda is typically accompanied by supporting documents to be tabled and discussed during the meeting so that invitees will have sufficient time to consider same in preparation for the meeting.  This will of course allow them to contribute effectively to any discussions and debate during the meeting and finally take informed decisions. Of course, notice must (appropriately and in a timely manner) be given to the persons entitled to attend the meeting, informing them of the appointed date, place and time of same. Moreover, and in terms of general meetings, when special business is to be discussed, this should be clearly indicated in the notice.
   1. ensuring that proxy forms and/or any appointment of alternate director forms, if applicable or required, are duly issued and accordingly received in original by the company.

Since the company secretary has no right to vote at meetings, how important is his/her role during the meeting itself, if at all?

The company secretary’s role during the meeting is indeed fundamental as he/she is tasked with a different set of duties, which would include:

1. Taking note of and recording all attendees present at the meeting as well as noting any apologies received from those invitees who were unable to attend (for any reason whatsoever);
   1. Ensuring that the relevant quorum (as per the M&As of the company) is present and informing the chairman accordingly so that the meeting can proceed to business. It is important to note that without the necessary quorum, the meeting cannot be validly held;
   1. Ensuring that the meeting proceeds in accordance with the agenda circulated and that all matters requiring a decision are effectively discussed and a resolution is effectively taken;
   1. Working together with the chairman to keep order in the meeting room and ensuring that all those who have a right to be heard are effectively heard; and
   1. Most importantly, recording the discussions held and all the resolutions put to vote in the meeting in the form of minutes. It is important to note that the minutes constitute the official record of the business transacted at the meeting, and in terms of law, once these are signed by the chairman, they shall be deemed to be evidence of the proceedings at the meetings.

Once the meeting is declared closed by the chairman, does the company secretary’s participation in said meeting stop there?

In practice, draft minutes of the meeting are typically circulated by the company secretary shortly following the meeting for consideration and comments, with formal approval of the minutes to generally take place at the next meeting where they can be signed by the chairman.

Naturally, in the interim, until the next meeting, the company secretary has the duty to pursue and manage follow-up actions that were recorded as action points during the meeting and to keep note of those matters which are to be placed on the Agenda for discussion during the next meeting.