WRITTEN BY BETTER BOARDS
Important decisions are made all the time in the boardroom and accurate meeting minutes are crucial as a record of those decisions and discussions. Taking minutes, though, can seem like a time-consuming chore. But, as high profile legal cases have shown, minutes are increasingly being used as a way to determine whether directors are properly performing their duties and responsibilities.
How to take good minutes
Lawyer Brian Herd summarises minutes as “a true and accurate record of the meeting”, which must contain “clear and concise notes of main discussion points, be accurate and a clear register of decisions”. Therefore, taking minutes isn’t just writing down verbatim everything that happens in a meeting. There are also legal requirements that must be met.
In Australia, every company must keep a minute book and meeting minutes must be lodged in that book within one month of the meeting. They must also be signed within a reasonable time by the chair. In practice, the minutes should be signed around the same time as they are lodged in the book. Directors should thoroughly review the minutes before this as once the minutes are signed, only clerical errors can be changed.
Minutes should also be kept safe and indefinitely. Electronic form is acceptable, but they should be able to be produced in hard copy form when required. They must also record attendance and apologies received ahead of the meeting.
In New Zealand, boards of companies, incorporated societies and charitable trusts must maintain minutes of all meetings and resolutions of shareholders, as well as meetings and resolutions of directors and directors committees, within the past seven years. The minutes must record:
– that the meetings were duly convened and completed;
– that the minutes of the previous meeting were approved as correct;
– directors in attendance and absent;
– late arrivals, apologies and early departures;
– whether the meeting was in person or electronic.
According to Herd, there are, in general, three broad approaches to taking minutes:
Minutes of action: this includes a general discussion, introductory remarks and an action outcome
Narration: this is where you have introductory remarks, key discussion points and action outcomes
Minutes of resolution: this is the least detailed one, where it’s just action outcomes.
Each organisation will be different and will need to adopt some form of a method according to their individual needs.
Minutes should follow the meeting agenda and be taken by the secretary of the board or a minute-taker. In general, they should only record matters of substance, such as who is responsible for what actions and when, as well as dissent.
With directors being held more to account, recording dissent is really important because if it isn’t recorded, then the default is that an action has been consented to. Directors have up to seven days to record their dissent once they become aware of a resolution.
Additionally, Herd recommends avoiding recording opinions and only note down criticisms or accolades if they are made through formal motion.
The minutes must be objective and as Herd puts it: “please don’t bring your minutes to life. Make them dull”.
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