What is the role of the Company Secretary
What is the role of the Company Secretary
Managing companies has become increasingly complex and requires skilled managers and executives to ensure that companies achieve the expectations of their shareholders.
In this respect, company secretaries have an important part to play. Their knowledge of and detailed involvement in the affairs of the company mean that company secretaries are well placed to make meaningful contributions to the prosperity of a company. The company secretary is, along with the directors, an officer of the company.
However, under the Companies Act of 2006 private companies do not have to have a company secretary, although they can choose to do so. Where they do, the secretary can play an important part.
However, all public companies, and any that propose to be registered as public companies, must have a company secretary.
The company secretary may also be a director of the company. The board of directors should only appoint a company secretary who can do the job, and their removal from the position should take place only with the consent of the whole board.
Professional company secretaries are often members of the Chartered Governance Institute UK & Ireland which notes that the role of the company secretary is a ‘strategic position of considerable influence at the heart of governance operations within an organisation’.
The role of company secretary is generally recognised in the business world as being crucial to the business. This is because the company secretary is usually at the centre of the decision-making process.
Their duties can be wide-ranging depending upon the size of the company, its organisation and the other personnel employed. The position is often coupled with other professional disciplines, especially those practised by accountants and lawyers. Many of the legal obligations placed on directors are also placed on the company secretary.
Company secretaries are therefore expected to be well informed, up to date and pro-active. They are achievers who add value to businesses as well as contributing to their company’s prosperity.
The role of the company secretary is of considerable importance and significance, and it will vary depending upon the size and status of the company and whether it is listed, public or private.
In smaller companies, the company secretary may also be the accountant/finance director for example. They are generally regarded as being the company’s chief administrative officer and, as such, should always be a key and influential member of the management team.
Amongst many other duties, they should have specific responsibility for the statutory compliance and governance issues and for ensuring that the company and its directors stay within the law.
It follows that the company secretary should also be involved in the decisions affecting the direction of the business, and it is for this reason that they should be involved in the formulation of strategy and policy within the company.
In recent years more companies are appointing non-executive directors, primarily because of corporate governance recommendations to ensure the independence of the board. The secretary is responsible for ensuring that non-executive directors are aware that their statutory responsibilities are no different from any other director; also, that they have access to other members of staff, that they are properly inducted and trained, and that they are generally kept informed of important issues in between board meetings.
If you need assistance with the structure of a board as your business grows and would benefit from a conversation, please get in touch and we will be pleased to assist you in this exciting change to the way you operate.