Company Secretary - Dissemnination of information and decisions - Coggle…
Company Secretary - Dissemnination of information and decisions
Although the directors have authority to convene board meetings, this is usually delegated to the CS (Model Articles plc reg. 9 Ltd reg. 8) who also plays a central role in the preparation for, convening and management of board meetings and is responsible for any administration tasks following the meeting
Until relatively recently, board papers would be collated, hard copies printed and these packs distributed by hand, post or courier to each director.
With the ever increasing use of secure email and remote access to corporate IT networks, some companies will now also distribute their board packs using email or by making the pack available on a corporate network
A number of third party vendors have developed board meeting management applications which among other features facilitate the distribution of board packs directly to a directors laptop or tablet
For the CS, there are obvious advantages for the electronic collation and distribution of board packs and the consequent savings in time, cost and significantly enhanced levels of security
There may also be enivornmental benefits though the reduced use of printing, paper and couriers. Another advantage is the ability to issue updated reports directly to directors laptops or tablet devices.
CS should ensure that the the director has received training to ensure that they can use the features of an application, such as the ability to make electronic notes on the meeting papers
Some of these applications form part of an entity management application which allows for all entity documentation to be retained securely in one database
Before the board meeting
In circumstances where board meetings are held on a regular basis, there are likely to be standing items on the agenda for topics that are discussed or reports received at every meeting such as finance update, business development, risk management, health and safety etc
In addition to these standing items, the CS should make enquiries of the directors and senior executives as to whether there are any matters that they wish to be discussed or brought to the attention of the board and from this list of topics a final agenda should be settled on after discussion with the chair and/or CEO
For listed companies, the agenda will most often be agreed in consultation with the chair and in other companies it is often the CEO that leads the board meeting process.
Having agreed the agenda, the CS should request that any documents or reports be made available in good time prior to the deadline for issuing the board pack to allow time for the reports to be reviewed, amended and the board pack itself complied
The time required to compile the board pack will vary considerably depending on how the board packs are distributed
The lead time to distribute the board packs in advance of the meeting will vary from company to company and will be driven by the length of the board pack, the frequency of the meetings and the preference of the chair
if any of the company's managers are to attend the whole or part of the meeting, eg the company's financial controller, internal auditor or risk manager, they should also be advised of the meeting and sent a copy of the agenda and supporting papers. If they are only to attend part of the meeting, it might be appropriate for them to be sent the papers for those relevant items only
It is a sensible precaution for the CS to ensure that spare copies of the agenda and supporting papers are available at the meeting itself. This will be the case even where the papers are distributed for viewing on an electronic tablet or laptop as these devices can fail during the meeting
The CS should also ensure that any presentations on a screen will be ready for display
The CS must be familiar with the quorum requirements and process for declaration and handling any conflicts of interests with any item of business considered by the meeting
If the board meeting is to be held virtually, the CS training for participating on the platform being used should be offered, in particular to first time users
Smooth running of a virtual meeting relies upon proper meeting etiquette. It may be appropriate for directors to ensure that they use two screens, one for the video feed and the other to display the meeting papers.
Generally the company secretary or an assistant should act as the host for the meeting allowing participants to join the meeting as required
During the board meeting
The CS should keep a note of those persons present at the commencement of the meeting, any apologies for absence and details of anyone joining or leaving the meeting. In this way, the minutes will reflect those present at any particular point during the meeting
The CS should ensure that a quorum is present at the commencement of business and whenever any decisions are reached.
If any item which a director has an interest is to be considered, they should ensure that there will still be an independent, disinterested quorum to deal with it
The CS should take notes during the meeting on any action decided on by the board and of its decisions reached, together with appropriate justification if necessary
The minutes should not be a verbatim record of what is said but should provide the reader with an accurate summary of the matters being discussed, any challenges raised and all decisions reached. Although the exact style and detail of the minutes is for each board to decide for itself, there will be external requirements to consider as wel
Particuarly for companies with external regulators, it is likely that the minutes will provide more detail on reasons for any particular decision and where a director has raised concerns, objections or challenge to a proposal and the actions taken or discussions to satifsfy that concern, objection or challenge
The external auditor (if appointed) may also review the minutes as part of their financial year end audit, for example to review confirmation of decisions and approvals made by the board
Voting at directors meeting is often informal and decisions usually reached by unanimous consent as directors have collective responsibility for their decisions and actions (Model Articles Plc and Ltd reg 7)
In rare cases where after discussion a director remains opposed to any particular course of action a formal vote may be appropriate and a note of the views of the dissenting director should always be recorded in the minutes
The chair may ask the CS to advise on any point of procedure regarding the conduct of the business of the meeting although it would also be appropriate for the CS to intervene in the meeting if the board were proposing to do something unlawful, contrary to the company's AoA or any other regulations the company is subject to such as the governance code or LR
If a manager or external adviser is to be present for a specific agenda item, the CS should ensure that they are ready to be called when that item is reached on the agenda
If any confidential papers are left behind on the board table by the directors or any flip chart pages used, these should be collected by the CS before staff come in to clear the room
After the board meeting
(Companies with publicly traded securities only) If the board has made a decision with regard to a notifiable event such as the payment of a dividend on the company's shares, years or half yearly accounts have been approved, a decision for the appointment or resignation of a director, an issue of shares or debentures or the postponement of the payment of a preference dividend or of interest, then an annoucnemtn via a RIS must be made as soon as possible
In practice, the CS will be aware in advance of the meeting that such an announcement is likely to be required and a draft of the announcement should be made available for approval by the board for immediate release following the meeting
The company's managers should be notified of any action which the board requires them to take
A note should be made of any item that has been deferred for future consideration to ensure that it is not overlooked
If the directors have asked for a report on a specific subject to be prepared for their next meeting, the CS should ensure that the manager responsible for preparing it is notified
The CS should prepare the minutes of the meeting according to the company's usual style and format. These should include details of any items carried forward for discussion at a future meeting. In addition, many boards prefer a schedule of action points to be circulated often in advance of the minutes being available
The procedure to be followed after preparation of the minutes will vary from company to company. However it is usual to send a copy of the draft minutes to the chair or sometimes the CEO for comments and once a settled version of the minutes is agreed a copy will be forwarded to every director present with a request that they return any comments by a given date. The final form of the minutes will be agreed following which the minutes can be prepared for distribution to all directors
If a director makes a comment about the wording of a particular minute, the alternation should be considered and if agreed, the minutes updated accordingly. Other than obvious mistakes, alterations should be confined to what was said rather than what any particular director meant to say or, on reflection would have preferred not to say
Board packs will often contain confidential personal information and the increased level of protection required following the coming into force of the GDPR Regulations in May 2018 means that company secretaries must review their processes for the secure distribution of board papers.