WKB Legal Alert | ANNUAL SHAREHOLDERS’ AND GENERAL MEETINGS – HOW TO PREPARE FOR THEM? KEY OBLIGATIONS, RISKS, AND NEW ESG REQUIREMENTS

The upcoming season will see numerous (for Polish joint stock companies, S.A.). This is a time when companies should not only make sure to perform their corporate duties, but it is also an opportunity for them to assess whether they are in compliance with ever-more complex reporting requirements, in particular in relation to ESG matters. Since a number of new regulations recently entered into force, including those related to the CSRD and ESRS, businesses should take extra care when organising their ASM or AGM this year.

Please find a summary of the most important issues to remember below.

BASICS – OR, THE ANNUAL CHECKLIST:

 Financial statements

• Confirm if the financial statements were approved by the management board and sent for audit by a statutory auditor (if required).
• Check if all of the data are complete and comply with applicable accounting standards (e.g., IFRS or the Act on Accounting).
• For capital groups – are the consolidated financial statements ready and synchronised with the data in separate statements?

Management’s report on activities

• Check if your company is required to prepare such a report – this depends on, among other things, the company’s SME status.
• If your company is a large enterprise, this is an absolute duty. For smaller entities, this will depend on its income and employment levels.
• Remember that this report can also include the first mentions of ESG activities, even if a standalone ESG report is not yet formally required.

Management and supervisory boards – terms of office and mandates

• Check when the terms of office end for members of the management and supervisory boards.
• Confirm if the company has an up-to-date register of the resolutions appointing and dismissing the members of its corporate bodies.
• If changes in the membership of corporate bodies are planned – it is worth preparing the relevant resolutions in advance, together with the necessary statements and attachments for the National Court Register.
• Will the pay of new members of corporate bodies need to be determined? If so and the company is expected to enter into an agreement with a member of the management board, then a proxy can be appointed during the ASM / AGM to execute this agreement on the company’s behalf.

Resolution on distributing profits or covering losses

• Is the planned distribution of profits (or the manner of covering losses) appropriate to the company’s financial situation and complies with the rules on maintaining its share capital?
• If there was no profit or a loss was incurred – are remedial actions planned that should be addressed during the meeting?
• If the company has adopted a dividend policy – does the resolution comply with this policy?

Supervisory board and audit committee reports (if applicable)

• For companies with a supervisory board – this board is required by law to prepare a report assessing the management board’s activities and the financial statements, as well as a report on the supervisory board’s activities.
• For public companies – this report must also include an assessment of the company’s internal control, risk management, and internal audit functions.
• Where an audit committee is appointed – it is worth confirming if the committee’s report is consistent with the supervisory board’s assessment and if it was formally adopted.

Expenditure report of State-owned companies

The management boards of state-owned companies  must prepare a report on representation expenses, as well as expenditures on legal, marketing, public relations and social communications, and management consultancy services.

• This report is first adopted by the supervisory board and then by the shareholders’ or general meeting.

ESG – NEW DUTIES AND POSSIBLE RISKS:

Since 1 January 2025 and the entry into force of certain amendments to the Act on Accounting, new sustainability reporting standards resulting from the CSRD have begun to apply in Poland. A new Chapter 6a “Sustainability reporting” was added to the Act. Entities subject to the reporting obligations (at present, only the largest listed companies, employing more than 500 people, and that have achieved specific financial thresholds) are required to prepare an ESG report under the new rules. The most significant changes include:

• The sustainability report constitutes part of the individual entity’s activity report,
• The report should be prepared in accordance with the ESRS,
• A double materiality assessment will determine the scope of the report and the precise information subject to reporting,
• The report must be verified by a statutory auditor,
• The report should be prepared in electronic form with data in the appropriate format, which will be published through the European Single Access Point.

The table below shows when specific entities will start to be subject to the new requirements:

Poniższa tabela prezentuje, które grupy podmiotów podlegać będą nowym obowiązkom:

The “Stop-the-clock” Directive adopted in April this year delayed the implementation of the reporting duty for entities that would have been required to prepare their first sustainability reports in 2025 and 2026. These entities are now required to begin reporting in 2028 and 2029, with their reports for financial years 2027 and 2028, respectively. We also expect further changes to this regime, which are currently being considered at the EU level as part of an omnibus package intended to simplify and limit sustainability reporting obligations. We will keep you informed and up to date on future changes in this regard.

SCHEDULING – DON’T WAIT UNTIL THE LAST SECOND TO PREPARE

May:

• Finalise documents.
• Confirm that management and supervisory bodies are well prepared.

May–June:

• Calling and holding the ASM / AGM.
• Shareholder communication.
• Submitting documents to the NCR and publishing  reports.

SEEKING ASSISTANCE?

Our company law and ESG teams support clients in:

• analysing obligations under the CSRD,
• preparing corporate documentation,
• assessing SME status and consequential reporting requirements,
• preparing ESG reports,
• updating the policies and by-laws of corporate bodies.

We would also be glad to assist in reviewing your documentation prior to your ASM / AGM.

In case of any question please contact Marta Czarnecka, Katarzyna Wójcikowska or Aleksandra Zbrzeżna.