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Power and Roles of Company Secretary

Updated: Jun 17, 2023

Company Secretary

I. Definition

A company secretary is an officer appointed by a company primarily to ensure that the company complies with its legal and regulatory obligations.

Under Section 171(1) of the Companies Act, every company is required to have at least one secretary. The company secretary must be a natural person who has their principal or only place of residence in Singapore. Additionally, the secretary must not be debarred under Section 155B from acting as a secretary of the company.

Furthermore, a sole director cannot simultaneously assume the role of a company secretary. This is because the roles of a director and a secretary are distinct and carry separate responsibilities and duties. While a director is responsible for the overall management and decision-making of the company, a secretary is primarily responsible for administrative and compliance matters.

In the event of secretary resignation, under Section 171(4) of the Companies Act, the office of the secretary must not remain vacant for more than 6 months.

Power and Roles of Company Secretary

II. Power of company secretary

  • Authentication of Documents

The company secretary has the power to authenticate documents or formal proceedings of the company. This involves verifying the accuracy and authenticity of various corporate documents, such as resolutions, minutes of meetings, and financial statements.

  • Counter-signing Official Documents

In cases where the company has a common seal, the company secretary may be required to counter-sign official documents that are executed under the common seal. The counter-signature serves as an additional authentication and confirms the authority of the company to enter into the document.

Company Secretary

III. Roles of Secretary

1. To the Board of Directors

a) Advisors

The company secretary serves as an advisor to the board of directors on matters related to corporate governance, legal and regulatory compliance, and best practices. They provide guidance and insights to ensure that the board operates effectively and in accordance with applicable laws and regulations.

b) Inducting New Directors

When new directors join the board, the company secretary assists in their proper induction. This may involve providing them with essential information about the company, its operations, governance structure, and legal obligations. The secretary helps new directors understand their roles and responsibilities and facilitates their smooth integration into the board.

c) Providing Practical Support

The company secretary offers practical support to the board of directors in various administrative and procedural matters. They assist in the preparation and distribution of board meeting materials, maintain records and minutes of board meetings, and ensure compliance with meeting procedures and legal requirements.

d) Timely Information Dissemination

The company secretary is responsible for ensuring timely and accurate dissemination of information to the board of directors. This includes circulating important documents i.e Financial Statements, updates, and announcements to directors in a timely manner, enabling them to make informed decisions.

e) Contribution at Board Meetings

The company secretary actively contributes to board meetings by providing procedural advice, ensuring compliance with meeting protocols, and recording minutes of the meeting. They help maintain an effective flow of communication between directors and facilitate discussions on agenda items.

2. To the Company

a) Complying with Statutory Obligations

The company secretary is responsible for ensuring that the company meets its statutory obligations as prescribed by the relevant laws and regulations. This includes filing of statutory returns, maintaining statutory registers, and submitting required documents to regulatory authorities such as ACRA .

b) Implementing Board Decisions

The company secretary assists in the implementation of decisions made by the board of directors. They help coordinate and communicate board resolutions to relevant parties within the company, ensuring that the decisions are properly executed and documented.

c) Guidance on Business Ethics and Corporate Governance

The company secretary provides guidance to the company on matters related to business ethics and good corporate governance practices. They help establish and maintain appropriate systems and procedures to ensure compliance with ethical standards, codes of conduct, and corporate governance guidelines. The secretary also assists in the development and review of corporate policies and procedures to promote transparency, accountability, and responsible business practices.

3. To the Shareholders

a) Attend to Enquiries and Requests

The company secretary acts as a point of contact for shareholders, addressing their inquiries, concerns, and requests for information. They provide assistance in understanding company policies, procedures, and statutory requirements, ensuring that shareholders receive accurate and timely responses.

b) Communication with Shareholders

The company secretary is responsible for facilitating communication between the company and its shareholders. This includes the distribution of financial statements, annual reports, notices of meetings, and other important information to shareholders in a timely and accurate manner. The secretary may also assist in organizing shareholder meetings and ensuring compliance with legal requirements related to shareholder communications.

IV. Limited administrative authority of secretary

The company secretary's administrative authority is limited and they generally require special authority from the board of directors to undertake certain actions. Some examples of actions that require specific authorization are:

-Calling a Meeting: The secretary cannot call a meeting of the company without a resolution passed by the board of directors authorizing the meeting. This ensures that the meeting is convened in accordance with the company's rules and procedures.

-Issuing a Writ: The secretary cannot issue a writ in the company's name without the specific authorization of the directors. This is to ensure that legal actions taken on behalf of the company are properly authorized and in line with the company's interests.

-Altering the Register of Members: The secretary cannot make changes to the register of members, such as striking off a name, without the approval of the directors. This is to maintain the integrity and accuracy of the company's shareholder records.

-Accepting and Entering Share Transfers: The secretary cannot accept and enter a transfer of shares on behalf of the directors without their authorization. This ensures that share transfers are properly reviewed and approved by the directors.

-Requesting and Entering Loan Agreements: The secretary cannot make any requests for loans on behalf of the company or enter into loan agreements without the approval of the directors. This ensures that financial decisions, including borrowing, are made by the authorized decision-makers within the company.

V. Appointment of a company secretary

A. General appointment

The appointment of a company secretary typically follows the process outlined below:

1. Appointment by the Board of Directors

The board of directors, through a board resolution or at a board meeting, can appoint a secretary for the company. This appointment is made in accordance with Section 171(3) of the Companies Act.

2. Consent to Act

The appointed secretary must provide their consent to act in the role. This consent is usually given by completing and signing Form 45B, which confirms their willingness to take on the responsibilities of a secretary.

3. Filing with ACRA

Once the appointment and consent have been obtained, the company is required to file the appointment of the secretary with ACRA within 14 days from the date of appointment. This filing ensures that the relevant authorities are notified of the appointment.

4. Update the Register of Secretaries

The company's register of secretaries should be updated to reflect the appointment. The details of the newly appointed secretary, including their name, address, and consent date, should be recorded in the register. Form 45B should also be filed and kept as part of the register.

B. The appointment of First Secretary

The appointment of the first secretary of a company can occur in two different scenarios:

1) Appointment during Incorporation:

The first secretary can be appointed at the time of the company's incorporation. The appointment can be confirmed and recorded in the first directors' resolutions or at the first Board of Directors' meeting.

2) Appointment within 6 Months from Incorporation:

If the appointment of the secretary is not made during the incorporation process, the company must appoint a secretary within 6 months from the date of incorporation. The appointment should be approved at the next directors' resolutions or at the Board of Directors' meeting following the incorporation.

VI. Resignation

When a company secretary wishes to resign from their position, the following procedures are typically followed:

1. Tender Resignation Letter

The company secretary must submit a resignation letter to the company. The letter should include the intended effective date of resignation and comply with any notice period requirements specified in the company's Constitution or the contract of service.

2. Record Resignation

The company must record the resignation of the secretary in its records. This can be done through board circular resolutions or at a board meeting where the resignation is acknowledged and accepted by the board of directors.

3. File Resignation with ACRA

The company is required to file the resignation of the secretary with the Accounting and Corporate Regulatory Authority (ACRA) within 14 days from the effective date of resignation. This ensures that the company's records and ACRA's records are updated accordingly.

4. Update Register of Secretaries

The company's Register of Secretaries should be updated to reflect the resignation of the secretary. This helps maintain accurate and up-to-date information about the company's officers.

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