Market practice information from the minutes of January 2011 meeting of the CLLS Company Law Committee
- Annual re-election of directors: That nearly three-quarters of FTSE 350 trading companies that had posted their 2011 AGM notices were proposing annual re-election of directors, despite being in a transitional period that meant that they were not yet required to do so to comply with the annual re-election requirements of the UK Corporate Governance Code.
- Articles of association and director re-election: That most FTSE 350 companies are not “hard-wiring” the requirement for annual re-election of directors into their articles of association, but retaining the flexibility not to put directors up for annual re-election.
- Auditor liability limitation agreements: That members of the Committee (with many of the major City law firms being represented) had not advised any companies proposing to enter into an auditor’s liability limitation agreement with their auditors.
- Scheme mix and match elections: The Committee and the UKLA will be jointly instructing Counsel as to whether a prospectus is required where securities are to be issued pursuant to a scheme of arrangement involving a mix and match election.
- FRC’s Company Stewardship report: The Committee’s views on some of the proposals put forward in the Financial Reporting Council’s ‘Effective Company Stewardship: Enhancing Corporate Reporting and Audit’.
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