The minutes book for a company, a key element in corporate management
Patrick Gordinne Perez2024-12-28T00:19:14+00:00The minute book is an essential document for any type of company, whether it is a small business, a cooperative or a large corporation. Its relevance derives from its use as an official record of the decisions taken by the company’s governing bodies. This document is not only a legal requirement in many jurisdictions, it is also a valuable tool for internal organisation and corporate transparency.
What is the minute book?
The minutes book is a formal record documenting the meetings and decisions of a company’s management bodies, such as the shareholders’ meeting or the board of directors. Each minute reflects the subjects discussed, the agreements reached, the votes cast, as well as the decisions taken during a meeting.
In general, the minutes book can be kept in physical or digital format, as long as it complies with the legal requirements in force in the country where the company operates.
What information is included in the minute book?
The content of the minutes book must be detailed and accurate, as each meeting must be faithfully documented. Generally, a minute book includes:
- Date, time and place of the meeting.
- Name of the attendees and their role within the company.
- Agenda, i.e. the items to be discussed during the meeting.
- Discussion and decisions taken on each item, including votes and opinions.
- Agreements and resolutions, including approvals, rejections and any other actions taken.
- Signature of those in attendance or those responsible for approving the minutes.
Accuracy on these points is crucial, as the clarity of the record ensures that agreements and decisions are formalised and can be reviewed or audited in the future.
Purpose of the minute book
- Legal basis: It acts as evidence of the decisions taken by the company. In case of any conflict or dispute, the minute book can serve as evidence before legal or administrative authorities.
- Internal control: It facilitates the coordination and monitoring of the decisions taken by the management bodies. The minutes allow the company to maintain control over the commitments made and their fulfilment.
- Transparency: Helps ensure transparency in decision-making, as each board member knows that his or her position and the resolutions adopted will be formally recorded.
- Corporate accountability: Ensures that the company’s governing bodies fulfil their duties and make decisions that are in the best interests of shareholders.
Types of minutes that are recorded
Depending on the type of company and its governing bodies, different types of minutes can be recorded, such as:
- Shareholders’ meeting minutes: Records the agreements and deliberations that take place during general meetings of the shareholders.
- Board minutes: Details the decisions taken by the company’s directors or managers.
- Committee minutes: Where the company has specific committees, such as an audit committee or a risk committee, their meetings should also be recorded.
How to keep the minutes book?
The maintenance of the minute book is essential to avoid legal or administrative problems. Although many companies opt for a physical minute book, nowadays it is also possible to keep it in digital format, in both cases, it must be ensured that the book is unalterable and secure. Minutes should be written clearly and precisely to avoid misunderstandings or ambiguities.
The language should be formal and direct, and all relevant points should be reflected. After drafting, each minute should be approved at the next meeting and signed by the secretary of the meeting and, in some cases, also by the chairperson. It is important to keep the minutes securely for a period of time that complies with the regulations in force.
Consequences of not keeping a proper record book
Failure to keep a minute book or keeping it incorrectly can have serious consequences for the company. The lack of a minute book can lead to fines by the regulatory authorities, in some cases even to the dissolution of the company.
In case of a dispute between the partners or an inspection by the tax authorities, the lack of a minute book can weaken the company’s position and cause significant legal problems. In addition, the lack of a record of decisions can damage the credibility of the company in the eyes of investors, suppliers and other stakeholders.
Who is responsible for the minutes book?
Generally, the responsibility for keeping the minute book rests with the secretary of the board or a director of the company. This person must ensure that each meeting is properly recorded and that the minute book complies with all legal requirements. In some larger companies, this task may be delegated to a specialised team or even to external advisors.
Digital Minute Book
Technology has transformed the way companies manage their processes, and the minute book is no exception. The digital minute book is a growing trend, especially among companies seeking greater efficiency and security in document management.
Digital platforms allow minutes to be recorded in a more agile way, offering advantages such as ease of search, integration with other management tools and the ability to access information from anywhere.
At Asesoría Orihuela Costa we offer you a team specialised in business management, our services include the drafting and analysis of corporate books, so that your records are updated based on current regulations .