Written Resolution

What is a Written Resolution?

A Written Resolution is a formal document used by the directors or shareholders of a company to record decisions that are made without holding a traditional meeting.

In many jurisdictions, corporate law allows for written resolutions as an alternative to in-person or virtual meetings, provided they comply with the company's articles of association and relevant legal requirements.

This method of decision-making can be particularly useful for routine decisions or when it is impractical to gather all the necessary parties at the same time and place.

What are the benefits of creating a Written Resolution?

Efficiency and Flexibility

• Written resolutions can be circulated and signed electronically, allowing for quick decision-making without the need to coordinate schedules for a meeting. This flexibility is particularly beneficial for companies with stakeholders in different geographical locations.

Cost-Effective

• Eliminates the costs associated with organizing physical or virtual meetings, including venue hire, travel expenses, and technological setup costs.

Convenience

• Offers a convenient way to handle straightforward or non-contentious decisions, reducing the administrative burden on company management and allowing them to focus on more strategic tasks.

Record Keeping and Compliance

• Serves as a clear and formal record of decisions made, aiding in compliance with corporate governance requirements and providing a transparent history of company actions for auditing purposes.

Enhanced Participation

• Facilitates participation from all eligible parties, as they can review and sign the resolution at their convenience, potentially leading to more inclusive decision-making processes.

Legal Validity

• When properly executed, written resolutions have the same legal validity as decisions made at formal meetings, ensuring that the company's actions are legally binding.

In summary, Written Resolutions offer a practical and efficient mechanism for company decision-making, providing benefits in terms of flexibility, cost savings, convenience, and compliance.

By allowing companies to make formal decisions without the need for a physical meeting, written resolutions can streamline corporate governance processes, enhance participation, and ensure timely action on business matters.