The general meeting: how shareholders prepare and have their say
In this article
The general meeting is the housing company’s highest decision-making body and the shareholder’s most important opportunity to get information, ask questions and have a say. It is worth preparing for the meeting, especially before a major decision, and you can have your say even when you cannot attend.
What is dealt with at the meeting
Under the Limited Liability Housing Companies Act (opens in a new tab), the annual general meeting must be held within six months of the end of the financial year. It is presented with the financial statements, the annual report and the auditor’s or operations auditor’s report, as well as the board’s written reports on maintenance needs over the next five years and on substantial maintenance and alteration work carried out in the company.
Among other things, the meeting decides on adopting the financial statements, discharging the board and the property manager from liability, the budget and the amount of the maintenance charge, and electing the board members and the auditor or operations auditor. Major renovation projects are decided either at the annual general meeting or at an extraordinary general meeting. The decisions later show up in the maintenance and financing charges, company loans, living comfort and the value of the apartment.
Decisions are generally made by majority, but some decisions require a qualified majority or even the consent of all shareholders under the law or the articles of association. How decision-making power is divided between the general meeting, the board and the property manager is explained in the article on the shareholder in a housing company.
The right to ask questions
You do not need to be a structural engineer or a lawyer. It is enough to ask if something is unclear, and a good question often helps others too. Shareholders have a statutory right to ask questions: on request, the board and the property manager must give more detailed information about matters that may affect the assessment of the item being dealt with. When the financial statements are being considered, the right also covers the company’s financial position more generally. If a question cannot be answered at the meeting, the answer must be given in writing within two weeks.
How to prepare
- Read the notice of meeting and the agenda.
- Look through the financial statements, the annual report and the budget.
- Read the maintenance needs report (kunnossapitotarveselvitys) and find out what repairs are coming up.
- Note down anything unclear and prepare your questions in advance.
You do not need to read financial documents like a professional. A low charge alone does not show that the finances are in good shape, nor does a high charge mean that the company has problems. Look at whether major repairs are coming up, how much the company has borrowed and how maintenance is being planned. The maintenance needs report does not promise what will definitely happen, but it gives the board’s view of the needs over the next few years.
When a renovation is being decided
Renovations affect daily life, schedules and costs, so they are usually what shareholders are most interested in. Before the decision, it is worth finding out at least the following:
- What problem is being solved, and has the building’s condition been investigated?
- What is the information based on: a survey, a study, a cost estimate or an assumption?
- What alternatives have been looked into, and has the work been put out to tender?
- What is the total cost estimate, does it include a contingency, and which costs are certain?
- How will the project be financed and how will it affect the charge?
- How long will the renovation disrupt daily life?
- What happens if the decision is postponed?
The cheapest option is not always the most economical. If option A costs €450,000 and option B €600,000, A can easily look better. To support the decision, however, it is worth understanding what the options include, what risks they involve and what their life-cycle costs will be over the next 10–20 years.
Imagine a housing company with 60 apartments facing a pipe renovation, a facade repair and a roof replacement. The combined price of the projects can run into millions of euros and an individual shareholder’s share into tens of thousands. In that case, the general meeting’s decision affects a shareholder’s finances more than many of their own purchases.
Electing the board
The general meeting elects the board, unless the articles of association provide otherwise. The board prepares matters and is responsible for the company’s administration, so its election is one of the shareholder’s most important ways of having a say. It is worth knowing who is standing and what expertise the board needs, or considering standing yourself.
Putting your own item on the agenda
A shareholder has the right to have a matter within the general meeting’s competence dealt with if they request it in writing from the board early enough for the matter to be included in the notice of meeting. Submit your request to the board well before the notice is sent out, not on the day of the meeting.
Disagreement does not mean conflict. A relevant question and a reasoned alternative are part of normal decision-making, and the best time to have a say is while the matter is being prepared and dealt with.
If you can’t attend
A shareholder can exercise their rights through a proxy. The proxy must present a dated letter of authority or otherwise reliably show their right to represent the shareholder. A letter of authority is, as a rule, valid for one meeting.
The board may decide that the meeting can be attended remotely, unless the articles of association restrict or prohibit this. A fully remote meeting with no physical venue requires a provision in the articles of association. In addition, the board may allow advance voting. Find out about the options in good time.
After the meeting
The minutes must be available for shareholders to inspect no later than four weeks after the meeting, and a copy must be given to any shareholder who requests it. Keep track of who is responsible for implementing the decisions and when work will start. If the decision concerns a renovation, follow its progress; if it concerns the finances, follow how the budget is being met.
Frequently asked questions
Do I have to attend the general meeting?
No. A shareholder has the right to attend but no obligation. If you do not attend, others will decide on matters that also affect your charge and your apartment.
Can someone else attend on my behalf?
Yes. Authorise them with a dated letter of authority.
Can I propose an item of my own?
Yes, if the matter falls within the general meeting’s competence and you request it in writing from the board in time for it to be included in the notice of meeting.
This article provides general information and does not replace case-specific legal or technical advice.
