Understanding New SEC Guidance for Virtual Meetings and Filing Delays Due to COVID-19



As the COVID-19 pandemic continues to unfold globally and across the United States (U.S.), many public companies listed in the U.S. are moving to virtual-only shareholder meetings for the first time or taking a hybrid approach to meetings with a mix of in-person and online attendance. While this is a sudden change for many organizations, if companies follow Securities and Exchange Commission (SEC) rules and guidance, they can easily conduct a virtual or hybrid meeting even if they have already distributed their proxy materials to shareholders. Furthermore, proxy advisors Institutional Shareholder Services (ISS) and Glass Lewis have announced that while they generally do not favor virtual shareholder meetings due to the inability of shareholders to engage directly with company leaders, they understand the necessity of virtual meetings during the current environment. These firms have one caveat however — they want to see disclosure of why the change was made in the proxy statement.

In this article, we summarize key guidance from the SEC about virtual meetings and additional disclosure related to COVID-19 so that public companies can navigate the nuances of this proxy season.

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