“We are trying to find out if anybody with a 31 December year end is proposing to amend their articles. Most companies like us should now have CA 2006 compliant articles. One area which might be looked at is the ability of the board to change the name of the company. PIRC do not like this and want the special resolution regime re-introduced.
Any thoughts?”
We changed our articles in June 2010 and have been advised that there is no absolute requirement to change them at the next AGM in May
We amended our articles in 2010 to be compliant with the Companies Act 2006, however, we are amending them again this year to allow for the annual re-election of directors and to tidy up other provisions around the election, retirement and removal of directors.
We probably would not have amended them for the annual re-election point if we had not wanted to change the election and removal provisions.
We updated our articles last year so don’t have any changes this year.
We got push back from PIRC on this area but not from anyone else.
We have a 31 December year end and adopted CA 2006 compliant Articles at our 2010 AGM. We made no specific change in relation to the ability of the board to change the company name. All voting organisations, including PIRC, voted for the changes, and no-one asked about the name change issue.
We amended our Articles at our 2010 AGM in line with CA 2006 which included authority to change the company’s name. After some dialogue with PIRC to reassure them that we had no intention of changing our name and we were in fact cementing the company’s brand they issued a “For” recommendation for the resolution.
We have adopted new compliant articles, including the ability for the directors’ to pass a resolution to change the name of the Company.
Similar to the above PIRC advice in their governance report was “abstain” against the resolution to adopt new articles, purely due to a change of name being in the power of the directors.
They cited that a name change could, for a variety of reasons, have significant implications for a company’s value. We had a brief dialogue and agreed to disagree. The resolution was passed with 95+% of the vote. PIRC don’t seem to be that influential with our shareholders!
No plans change our articles at the 2011 AGM. We put all the final changes through last year to be CA2006 compliant, including the ability for the directors’ to pass a resolution to change the name of the Company.
PIRC advice in their governance report was “abstain” against the resolution to adopt new articles, purely due to a change of name being in the power of the directors. Reasons cited included that a name change could have significant implications for a company’s value where the name is an important aspect of its brand; substantial costs involved associated with the change of name process, advertising and communications with stakeholders. We entered into dialogue and said directors previously would have taken all these things into account before putting a special resolution to shareholders – it is not something done lightly or on a whim. PIRC would not change from abstain. The resolution was passed just under 98% of the vote and very little abstain. So it depends how influential PIRC are with your shareholders.
No plans to reverse this
We put this change through last year as part of our “final” mop up of the 2006 Act changes and do not intend to reverse it.
We are putting the entire Board up for re-election this time but have decided to retain the 3 year rotation provisions in the Articles. Accordingly we do not anticipate making any changes to our articles this year.
Provide you are CA 2006 compliant the only issues to consider would be whether you are proposing to do annual re-election of directors in which case you may need to amend the wording.