The New Jersey Business & Industry Association supported a bill released by a legislative commitee today that will continue to make it easier and less expensive for New Jersey corporations to comply with state corporate rules coming out of the coronavirus pandemic.
The Senate Commerce Committee voted 5-0 to advance the bill, A-4918, that would make permanent the accommodation of incorporated companies to conduct virtual shareholder meetings (VSMs) at their discretion.
“Over the course of the past year, we have found that companies that execute VSMs have much greater, attendance and engagement,” said NJBIA Vice President of Government Affairs Christopher Emigholz. “These companies also benefit from the considerable cost and time savings to be had through virtual VSMs versus in-person meetings.
“While we do look forward to the further reopening of our economy, it would be smart policy to allow these corporations the flexibility to conduct VSMs when they need or prefer to.”
VSMs over the course of the pandemic have allowed shareholders – even those who may have been able and interested in attending a physical meeting – to attend multiple meetings, including meetings held on the same day for which physical attendance at each would not have been possible.
VSMs provided benefits to proponents of shareholder proposals. Consistent with Securities and Exchange Commission guidance, virtually all companies holding VSMs made provisions for proponents to present proposals by remote communication or to submit a pre-recorded statement.
This allowed many people who in the past had found it necessary to locate and appoint a representative to attend a meeting on the proponent’s behalf to speak directly to their own proposals instead.
“We believe it’s a good thing that corporations provide their shareholders greater access and can benefit from hearing directly from them rather than an intermediary,” Emigholz said.
The bill, sponsored by Assembly Majority Leader Louis Greenwald (D-6), and Assemblymen Gordon Johnson (D-37) and Raj Mukherji (D-33), now goes to the full Senate for consideration.