The Capital Companies Act establishes that directors of companies in Spain are obligated to attend shareholder general meetings because the essential functions for the effective operation of the company may be developed during these meetings, including:
- The control or supervisory function that the general meeting has over the board itself
- Exercising the shareholders’ right to information whose obligation is of the directors.
Delegation is not possible
The attendance of the directors of a company in general shareholders’ meetings is an integral part of their responsibilities and cannot be subject to delegation. If a shareholder can be represented this does not mean that the director may also be.
Attendance at the Meeting
Therefore, it is imperative that the director (or directors if there are more than one) attend the meeting, as a third party cannot represent him or her.
Tribunals consider that where the director does not attend the meeting and his or her presence is deemed necessary so that the shareholders can exercise their right to information, that meeting can be nulled. A shareholder can challenge a meeting by claiming that he or she was unable to request clarifications or relevant information of the accounts and therefore, was unable to vote with the necessary information. In order to avoid such risk, it is advisable that one makes, and everyone signs, a record of all the directors in attendance at the meeting.
This article is not considered as legal advice