Board resolutions are a formal method of documenting and recording the decisions made during a meeting. They make sure that the decisions taken are in line with local, state and federal laws and regulations. They also limit any legal risks that could arise from these choices.
The board must keep a log of all decisions, no matter how minor or significant they might be. The board must also demonstrate http://fishboardroom.com the reasoning for the decision, so that everyone outside can comprehend the reasons behind the decision and if it was the correct decision.
As such, composing an official resolution for a board can be a daunting task. However, by learning about the purpose of these documents and using the right tools for composing them you can simplify the process.
A Board Resolution: What it is and How to Write One
The board needs to document important decisions that affect shareholders or the company in a formal way. These decisions are referred as resolutions by the board and aid to establish clear policies on matters such as governance, ethics and risk management. These resolutions can also be used to show the board’s dedication to transparency within the company.
Board resolutions can be voted on during a board meeting or, in more modern times, they may be ratified through written resolutions. When a resolution is written, it must start with a “WHEREAS” statement that highlights the topics discussed during the meeting, before moving to the resolved statements. When the document is completed and signed by all directors present at the meeting.
