To understand better what a board resolution template is, let’s first describe the setup of a business organization. First, the shareholders own the company and they appoint directors who collectively make up the company’s board. When there’s a need to make decisions on behalf of the company, the directors will pass different kinds of board resolutions. The type of resolutions to pass depends upon the seriousness of the decision.

Board Resolution Templates

When to use a board resolution template?

A board resolution template is a manner of documenting decisions made by the company’s Shareholders or Board of Directors. The decision can cover anything relevant to the affairs of the organization like a decision extending loans to other companies or when voting for a new member to join the board.

After the Board of Directors has decided upon the resolution through a meeting, they write the board of directors resolution which contains the details of the resolution. You can use the board resolution format if:

  • You have to document a decision made during a Board of Director’s meeting.
  • You need to document a decision made by the Shareholders of the company.

Sample board resolutions may include a wide range of actions including voting in a new Board member, hiring of new company employees, selling shares of the company, purchasing a patent, and other major decisions. The resolution serves as a compliant document and gives the company a written record of the approved decisions.

In general, there’s really no need to supply or submit resolutions to any government agency or other similar entities. Instead, you must keep the resolutions under file with the company’s books. That way, they’re readily available should an important shareholder want information about the decisions made by the Board on his behalf.

Board Resolution Formats

Why do you need to create a board resolution template?

A simpler way of defining a board resolution template is an official document which says something about an important issue on company matters that the board wants to have documentation of. The ones who can create this document are the company’s Shareholders on behalf of the company, Board of Directors, or even a government entity.

How long the board of directors resolution doesn’t matter. It just needs to be as long as you make it. There are several reasons to create a board resolution format but technically, the Board can come up with one for any reason they come up with. Here are the most common reasons for this document:

  • To document the voting of a new board member.
  • To document a decision which they made in one of the board meetings.
  • To document a decision that the shareholders made.
  • When the company will hire new employees.
  • When the company wants to sell some shares.
  • When the non-profit organization needs to delegate funds to certain projects.

By standard practice, you must keep resolutions in a file together with important documents like books and records. You must also have a backup copy stored in another secure place. You can also keep this document together with the minutes of the meeting because resolutions are documents which are legally binding.

Board Of Directors Resolutions

Who can make a board resolution template?

Before companies can make any decisions about specific issues, they must ascertain first that the substance of such issue requires consideration either from the Shareholders or from the Board of Directors. The drafting of a board resolution template requires guidance from the constitution of the company and its shareholders.

For this, it’s imperative to consider the types of issues carefully, especially the ones which require voting when you present a sample board resolution. There is also the Corporation Act of 2001 which sets out specific matters which require specific kinds of resolutions.

For instance, to change the name of a company, you need a special kind of resolution which can only get approved with at least 75% of the votes. It’s also important to familiarize yourself with the types of resolutions required by the Corporate Act on specific issues and how these apply to your own company.

Sample Board Resolutions

When to hold board resolutions?

A board resolution may pass in a Board of Director’s meeting. These meetings are generally held at least one time each year but in reality, get called more frequently. Any of the board members can call a meeting by providing reasonable notice to the other members of the board and the caller should provide an agenda so that the other members can prepare for discussions.

There can be instances when members may not be able to personally attend the meeting. As such, this member, with the consent of the other board members can still take part in the meeting using different means. During the meeting, the directors can vote one of their own to act as the chairman for the meeting and he will be in charge of the smooth flow of the meeting and the proper recording of all matters.

The chair’s voting right or not depends upon the company. This usually happens when you have an even-numbered quorum and even votes on passing or rejecting a specific issue. Procedural matters needed for a valid and effective board meeting are usually set out by the company’s constitution or by the shareholder’s agreement.

Free Board Resolution Templates

Types of board resolutions

When making a decision about the matters to place before the board of directors, each of the directors has a single vote. So that the board can approve of an issue, they must first consider the type of resolution to use. Here are the main types of resolutions made by the board:

  • Ordinary Resolution
    This type refers to the agreement of just more than half or 50% of the directors who attended the board meeting.
  • Special Resolution
    This type refers to the agreement of over half which is usually 75% of the directors who attended the meeting. Of course, the percentage value is completely negotiable. It depends upon the terms written on the constitution of the company and the shareholders’ agreement.
  • Unanimous Resolution
    This type refers to the agreement of all the directors who attended the board meeting. This means that 100% of those present must be in favor of the issue to pass. The more directors the issue requires to vote a single way, the more difficult the issue is to pass.

The terms in the constitution of the company, the Corporation’s Act or the shareholder’s agreement determine the type of resolution to use. As a rule of thumb, you can use ordinary resolutions to pass the daily decisions involved in the company’s operations.

For more serious issues like modifying or adopting the constitution of the company, this requires a special type of resolution. It’s not as common to have unanimous resolutions as this may logistically be very difficult for the company to make any kind of changes.

Tips for writing a board resolution template

For those who haven’t seen or read a board resolution template, reading one could be very intimidating because of its formal language. The truth of the matter is, once you get familiarized with the components of the resolution, they’re really not that hard to compose. It’s recommended that before starting to write one, look at some of the sample board resolutions that other persons have written.

This is important so you can get an idea of its format and language. If you can work in tandem with other persons, you can come up with a written board resolution template in no time. Here are some pointers that can guide you when writing this template:

  • When creating the board resolution format, put the date and the resolution number at the top of the page. If it’s the first resolution of the board, you can use any number that suits you. Just make sure that the succeeding numbers bear a consecutive number.
  • The title of the resolution should speak of the issue for which you created the resolution.
  • Always make it a point to use formal language in the body of the resolution. Remember that this is a legal document. You may want to start every paragraph with the word “Whereas.”
  • You can proceed to write out each important statement of the resolution. Again, each paragraph should start with the word “Whereas.”
  • The final statement of the resolution should state the final resolution or the decision which the Board has adopted. Make sure to write this statement in a clear and concise manner which everyone will understand.
  • At the bottom of the resolution will be the list of the board members who voted on the resolution with spaces adjacent to their names where they can indicate whether they voted “yes” or “no.” Obviously when the majority of the board members voted “yes,” this means that the resolution got approved.
  • Don’t forget to allot a space for the board president where he signs and dates the document.
  • Before printing out the document and asking the authorized persons to sign, make sure to proofread it first. Since this is a formal and legal document, there shouldn’t be any spelling or grammatical errors. Before finalizing the document ask another person to read it to catch any mistakes you may have missed.
TemplateLab May 2nd, 2019