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

Board resolutions are an official method of recording and documenting the decisions made during a board meeting. They ensure that the decisions made are in compliance with the state, federal fishboardroom.com/how-to-run-an-effective-workshop-and-board-of-directors/ and local laws and regulations. They also help reduce the legal risks that could result from these choices.

If the decision is something as small as a change in the hours of work for employees or as major as shutting down an enterprise the board should have a documented record of it. The board must also be able to explain the reasoning for the decision so that anyone who doesn’t know the decision can understand why it was taken and whether or not it was the right decision.

Thus, composing an official resolution for a board can be an intimidating process. However, by educating yourself about the significance of these documents and making use of the appropriate tools to write them it can make the process much easier.

What is a Board Resolution? And how do you create one?

When the board makes important decisions that affect shareholders or the company, they must document these in a formal manner. These decisions are known as resolutions of the board. They provide clear guidelines in areas such as governance and ethics. They are also used to demonstrate the board’s dedication to transparency of the corporate structure.

Board resolutions can be voted on during a board meeting or, in more recent times, they may be passed via written resolutions. When resolutions are written, it must start with a “WHEREAS” statement that highlights the subjects discussed at the meeting prior to moving on to the resolved statements. The document must be signed by each director who attended the meeting.