Annual general meeting (AGM)

What an AGM does

An AGM is the corporation's annual moment of formal accountability to shareholders. It typically covers:

• Receipt of the audited or reviewed financial statements for the prior year
• Election of directors for the coming year
• Appointment or reappointment of the auditor, or a waiver of audit where permitted
• The chair's or president's report on corporate affairs
• Special business, such as approval of stock plans, articles amendments, or fundamental changes

Notice and quorum

Statutes and bylaws define how the meeting is called: how many days' notice must be given, what must be in the notice, and what constitutes a quorum. A meeting held without proper notice can be invalid, and decisions taken at an invalid meeting can be challenged after the fact. The notice must usually identify the date, time, place (or virtual access), and the matters to be voted on.

For private corporations, notice and quorum requirements can often be relaxed in the bylaws, but the relaxation must be done deliberately, not by accident.

Waiver by written consent

Most private corporations don't actually hold an AGM. They satisfy the requirement through unanimous shareholder written consent, which approves all the items that would have been on the agenda. This is faster, cheaper, and equally effective in jurisdictions where it is permitted. The key is that the written consent must be unanimous (under the CBCA) or meet the threshold the statute or bylaws permit.

The risk of skipping the AGM without a written consent is that no director is properly elected, no audit waiver is in place, and the prior-year financials have not been tabled. These gaps surface in diligence and can require costly retroactive corrective resolutions.