Members are being invited to vote on a number of ordinary resolutions included in the Notice of the AGM. Under the Friendly Societies Act 1992 some resolutions must be held as Special Resolutions. Resolution 7 concerns changes in our Memorandum, where in paragraph 3, one such change relates to the control of subsidiaries and is therefore considered a Special Resolution.
What is a Special Resolution?
As above we have one resolution on the Notice captured within resolution 7. A Special Resolution requires ¾ of the votes or proxy votes to be in favour and the resolution cannot be effective unless it is passed as a Special Resolution.
As a Friendly Society, two of the key governance documents which detail the way in which the firm operates are known as the Rules and the Memorandum of the Society.
These two documents have always been in place and the current live versions are always available on our website here and you may wish to use these as a comparison when considering the proposals.
Why are the proposals being made?
The current documents have been in place since their last review in 2015. It is good governance to review these key documents periodically to ensure they remain relevant to the success and operation of the Society for you, our members. There are a number of changes being made, none of which will affect the operation or service you currently receive from the team at Metfriendly.
Why were these documents not included in the AGM notice?
There is an agreed process that we must follow with our regulator when changes are made to the Rules or Memorandum. Once the Board gave their support for the changes, the proposals were submitted to the FCA for their consideration and it would not be appropriate to share with Members until the FCA have made any comments or observations. We received confirmation that there are no comments or observations on the proposals in either documents and can now share these with you in time to review ahead of your voting for the AGM in July.
What happens at the AGM with the proposed changes?
Members have been invited to review and vote on the proposals at the AGM and details of how to vote are included in the notice provided to members. If voting members agree to the changes the regulator will then be notified of this and formal acceptance will be requested from the FCA after the AGM. The new documents will then be recorded in the FCA register and the new Rules and Memorandum will be adopted from a set date once that final approval is provided.
What are the changes?
We appreciate these are large documents with many sections. The thrust of the changes that we are proposing to make are to modernise the Society’s constitution, bringing the Society’s governance framework up to date as far as possible and in line with the Society’s requirements and relevant changes to legislation. Some of the changes are also intended to clarify the drafting of certain more archaic provisions. We have worked with an independent law firm to ensure the rules remain compliant throughout.
The more material changes to the Memorandum and Rules can be summarised as follows:
- Paragraph 3
- Amended to clarify the introductory wording in respect of the Society’s purpose (the substance of which remain as currently contained in our existing Memorandum).
- Provisions relating to subsidiaries and jointly controlled have been made clearer and modernised to remove previous express restrictions on the objects of such bodies and reference to the “commission” which is no longer relevant
- Paragraph 4 – Specific provision relating to borrowing included. The Society has no current plans to borrow but modernises the Memorandum and provides the ability to do so but only if it is approved by the Board
- Paragraph 5 – Definitions and interpretation section added for clarity.
- Rule 1(1) – Expansion of scope of individuals who may become members of the Society to include other regional forces alongside the Metropolitan Police and the City of London Police. This allows for both career moves and increased membership of the Society.
- Updating of provisions relating to electronic communications throughout the Rules. This is appropriate given the increased use of electronic communications by our Members and wider society removing the use of resources such as paper where possible
- Certain Rules updated to simply refer to the relevant legislation rather than replicating sections of the legislation which can be updated from time to time
- Rule 7 – More specific provisions relating to disqualification and forfeiture of membership added
- Rule 15 – Rules relating to powers of the Board updated
- Rule 16 – Clarification of certain provisions relation to eligibility and nomination of directors
- Rule 24 – Additional clarification and provisions in relation to Vacation of Office and Disqualification of directors
- Rule 27 – Clarification of certain provisions relating to the Election of Directors
- Rule 30 – A deposit of £50 being required from each requisitioner of a Special General Meeting.
- Rule 31 – Provisions added to permit Virtual/Hybrid meetings and attendance at a secondary meeting place. This will make the use of virtual AGM’s possible as was temporarily allowed during 2020 in the early stages of the Covid 19 pandemic.
- Rule 36 – New provisions to permit postal and electronic ballots.
- Rules 40, 45 and 46 – Simplified auditor, disputes and complaints provisions.
- Rule 51 – Expanded Notice provision.
- Appendix – updated definitions and interpretation provisions
In addition to the changes above we have updated the language and phraseology throughout the documents to make them easier to read with clearer and consistent use of words.