Environmental and social transparency under the ... - ClientEarth

88 | Environmental and social transparency under the Companies Act 2006Annex 1: UK law governing company environmental and social accounting and reporting | 89s426 Option to provide summary financial statement(1) A company may—(a) in such cases as may be specified by regulations made by the Secretary ofState, and(b) provided any conditions so specified are complied with,provide a summary financial statement instead of copies of the accounts andreports required to be sent out in accordance with section 423.The annual accounts and reports must, as default, be circulated to everymember of the company, every holder of the company’s debentures, andevery person entitled to receive notice of general meetings. However, insome circumstances the company may be allowed to send a ‘summaryfinancial statement’ instead of the full annual accounts and reports.‘Summary financial statements’The Companies (Summary Financial Statement) Regulations 2008 set outthe rules relating to summary financial statements. 255 Subject to a numberof conditions, a company may send a summary financial statement insteadof full annual accounts and reports. The most important condition is that ifany individual shareholder wishes to receive the full accounts and reports,the company is obliged to send them to that individual. 256 Companies arealso obliged to undertake a process to give notice to shareholders of theirintention to send a summary financial statement, and to ascertain theirwishes in that regard. 257In the circumstance that a publicly-traded company 258 may send a summaryfinancial statement, they must also send (at the same time) the explanatorymaterial relating to the directors’ report 259 required by paragraph 14 of theLarge and Medium-sized Companies and Groups (Accounts and Reports)Regulations 2008. The required material, to summarise, is “any necessaryexplanatory material” with regard to: securities transfer restrictions;details of significant direct or indirect holdings; details of special rights ofcontrol; rights of control of any employees’ share schemes; restrictions onvoting rights; restrictions on the transfer of securities or on voting rights;rules that the company has about appointment and replacement of directors,or amendment of the company’s articles of association; powers of thecompany’s directors; information relating to takeover bids. 260 None of thisrequired explanatory material relates to environmental or social matters.Therefore in the circumstances that a company sends out a ‘summaryfinancial statement’ in lieu of its full annual accounts and reports, there isno explicit requirement to send any materials relating to the environmentalor social matters.A.1.3.2The role of Annual General Meetingss437 Public companies: laying of accounts and reports before general meeting(1) The directors of a public company must lay before the company in generalmeeting copies of its annual accounts and reports.(2) This section must be complied with not later than the end of the period forfiling the accounts and reports in question.(3) In the Companies Acts “accounts meeting”, in relation to a public company,means a general meeting of the company at which the company’s annual accountsand reports are (or are to be) laid in accordance with this section.Company accounts and reports, including the directors’ report, must be‘laid’ before the company in general meeting. In practice, there will usuallybe the opportunity for discussion of the reports in the general meeting,when they are laid before it. However, this is not explicitly requiredby law. Neither is there legal requirement that the annual reports needthe shareholders’ approval or acceptance; shareholders have no ability toreject them. 261A.1.3.3How are companies required to publish their accounts andreports?s430 Quoted companies: annual accounts and reports to be made available onwebsite(1) A quoted company must ensure that its annual accounts and reports—(a)(b)are made available on a website, andremain so available until the annual accounts and reports for the company’snext financial year are made available in accordance with this section.(2) The annual accounts and reports must be made available on a website that—(a) is maintained by or on behalf of the company, and(b) identifies the company in question.(3) Access to the annual accounts and reports on the website, and the ability toobtain a hard copy of the annual accounts and reports from the website, mustnot be—(a)(b)conditional on the payment of a fee, orotherwise restricted, except so far as necessary to comply with any enactmentor regulatory requirement (in the United Kingdom or elsewhere).(4) The annual accounts and reports—(a) must be made available as soon as reasonably practicable, and