By Amanda Honeyman – Board & Governance Advisor
Many boards consider that the CEO is the most important appointment that the board makes. However, the board also appoints another important position – the company secretary.
As the roles of boards and directors have evolved to meet increasingly complex regulatory requirements, so too has the role of the company secretary. Today’s company secretary often doubles as a governance expert – and has the training and qualifications to support their role.
Key benefits of a professionally trained company secretary include:
- providing centralised, consistent quality assurance of board papers
- high quality board meeting minutes which accord with good practice (which is especially important given minutes are legal evidence of the meeting and so can be used to prosecute and defend directors!)
- accurately recording and following up board meeting actions
- protecting the board and directors through expert governance advice on matters such as conflicts of interest, compliance and the latest developments in directors’ duties.
While it may be tempting, and practical, to combine the company secretary role with the CEO or an executive (particularly for smaller organisations), this has disbenefits. These roles have differing responsibilities and reporting lines to a company secretary and so combining them can:
- create difficulties if they are required to both participate in and take minutes of board meetings
- affect the flow of information to the board
- give rise to conflicts of interest, and
- make it more difficult to ensure the confidentiality of the boardroom discussions.
Organisations that do not, or cannot, employ a separate company secretary often access professional company secretary services on a part-time contract basis. Often, this support is for a few days per month, centered around board meetings.
With increasing personal liability placed upon directors, the question for boards isn’t whether they can afford a dedicated company secretary, rather it is how long can your board continue without one.
Speak to Directors Australia today if you require independent governance advice or professional company secretary support for your organisation. Please email Amanda Honeyman at firstname.lastname@example.org