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Board of Directors Resolutions are formal documents that provide a detailed outline of the official decisions made by a board of directors. They are therefore legally binding for the organization. They may also be requested by company’s shareholders or the government authorities in the course of a verification process.
Board resolutions are usually created at board meetings. They require a majority vote of the board. They may also be ad hoc papers which are voted on and approved by the board outside of the meeting. There are many kinds of resolutions. These include motions to abstain from notification, minutes and adjournment.
During a board meeting, the board will first go over the proposed resolution, and then decide whether any additional information or specifics should be added. A member of the board will propose to adopt the resolution and a seconder vote to second it. Once the motion has been seconded the board will vote on the resolution according to a process as laid out in the company’s bylaws. The votes are recorded in the minutes of board meetings by the corporate secretary. The resolution is then signed by the appropriate officers.
While the process of writing and recording a resolution for the board can be a challenge for novice board members, a complete understanding of how to draft a resolution makes the process much easier. By using a standard format, and providing clear and concise information the board can be capable of quickly and efficiently adopt resolutions that satisfy the needs of the company. Make sure that your resolutions are legal and efficient by placing them in a secure online repository with Board Management Software.