A Board Resolution – What it Is and How to Write One

Board resolutions are a formal way to record and document decisions made at an upcoming board meeting. They guarantee that the decisions made are in compliance with federal, state and local laws and regulations. They also reduce the legal risks that could arise from these choices.

The decision being considered is as minor as a change in the hours of work for employees or as major as shutting down a business the board must keep a documented record of it. The board should also be fishboardroom.com/boardmaps-and-govenda-by-boardbookit-what-is-more-effective/ able provide the rationale behind the decision, in order that anyone who isn’t a member of the board can understand the reasons behind the decision and if it was the right choice.

Composing a board resolution is an arduous task. If you know the purpose behind these documents and utilizing the correct tools to create them to make it a lot easier.

A Board Resolution: What is it Is and How to Write One

The board needs to document important decisions that affect shareholders or the company in a formal manner. These decisions are referred to as resolutions of the board and assist to establish clear guidelines on matters such as governance, ethics, and risk management. They also serve to demonstrate the board’s dedication to transparency of the corporate structure.

Board resolutions can be passed in a physical board meeting or, in more modern times, they may be approved through written resolutions. When writing a resolution, it must start with the words “WHEREAS” that outlines the issues that were discussed at the board meeting. Then, the resolutions are added. Once the document is complete it has to be signed by all directors who were present at the meeting.