Secretarial compliances regarding drafting of the Minutes for various Meetings

In corporate governance, the drafting of minutes for meetings and the recording of resolutions are crucial for maintaining legal compliance and ensuring that decisions taken during meetings are accurately documented. The company secretary plays a key role in ensuring that minutes are drafted properly and in compliance with statutory requirements. These minutes act as an official and legal record of the company’s meetings and resolutions.

Importance of Minutes

Minutes serve as an official record of decisions made during meetings. They are important for:

• Providing an accurate account of what transpired during meetings.
• Legal documentation for compliance purposes.
• Proof of compliance with legal requirements for corporate governance.
• A record for future reference by shareholders, directors, and other stakeholders.

Types of Resolutions

Resolutions passed during meetings are of different types, and each type requires specific formalities and compliance in terms of recording. The two main categories of resolutions are:

• Ordinary Resolutions: These are passed by a simple majority (more than 50% of the votes cast) at a meeting. Ordinary resolutions are typically used for routine decisions.
• Special Resolutions: These require a higher majority, usually at least 75% of the votes cast. Special resolutions are used for more significant matters such as changes in the company’s name, capital structure, or articles of association.
• Written Resolutions: These are passed without the need for a meeting, based on the written agreement of all shareholders or members.
• Unanimous Resolutions: Passed when all members or shareholders agree.

Each resolution type has specific implications for the minutes, and it is important to ensure that they are recorded in a legally valid manner.

Drafting Minutes of Meetings

The minutes of meetings serve as the official record of the proceedings, decisions, and actions taken. They should be drafted in accordance with the following principles:

• Clear, Concise, and Accurate: The minutes should reflect the key discussions and decisions without unnecessary detail. They must be accurate and provide a true representation of what took place during the meeting.
• Date, Time, and Venue: The minutes should begin with the details of when and where the meeting took place.
• List of Attendees: All attendees should be listed, including directors, shareholders, and invited guests. It should also note if any members were absent and whether any proxies were appointed.
• Agenda Items: Each agenda item discussed should be recorded, along with the decisions taken. For each resolution, mention the proposer and seconder, the voting method, and the result.
• Voting Details: For each resolution, the number of votes cast in favor, against, or abstentions must be noted, especially for special resolutions. The number of votes cast is crucial in case of a dispute.
• Proposals and Discussions: If there were significant discussions before a resolution, key points of debate should be recorded without including a verbatim transcript.
• Signatures: The minutes must be signed by the chairman of the meeting, certifying that the minutes are accurate.

Legal and Regulatory Framework

• Companies Act, 2013: In India, the Companies Act, 2013 prescribes the manner in which minutes should be maintained. It mandates that minutes of all meetings (board, general, or special meetings) should be signed by the chairman of the meeting or the chairman of the next meeting.
• Rule 25 of the Companies (Management and Administration) Rules, 2014: These rules outline the requirements for drafting and maintaining minutes for general meetings and board meetings. The minutes should be recorded in the minutes book and signed by the chairman.
• Secretarial Standards: The Institute of Company Secretaries of India (ICSI) has issued Secretarial Standards (SS-1 and SS-2), which provide detailed guidance on the drafting and recording of minutes for board and general meetings, respectively.

Compliance with Secretarial Standards (SS-1 & SS-2)

According to the Secretarial Standards-1 (SS-1) and Secretarial Standards-2 (SS-2) issued by ICSI, certain specific guidelines must be followed while drafting the minutes:

• SS-1 (Minutes of Board Meetings): This standard covers the recording of board meeting minutes and requires that the minutes must be approved at the subsequent board meeting. It provides guidance on the content of the minutes, the recording of resolutions, and how to deal with unresolved matters.

• SS-2 (Minutes of General Meetings): This standard governs the recording of minutes for general meetings, including AGMs and EGMs. It specifies how resolutions must be recorded, how discussions should be summarized, and the time frames within which minutes must be signed and approved.

Essential Components of Minutes for Various Meetings

• Board Meetings:
  • Date, Time, and Venue of the meeting.
  • List of Attendees (Directors and other invited persons).
  • Summary of discussions and decisions taken.
  • Resolutions Passed, with the names of those proposing and seconding.
  • Voting Outcome: Whether resolutions were passed or rejected.
  • Any special instructions for implementation.
• Annual General Meetings (AGM):
  • Agenda Items discussed in detail.
  • Approval of Financial Statements and any other formal business.
  • Resolutions passed by shareholders, including special resolutions.
  • Reappointment of Directors or auditors, if any.

• Extra-ordinary General Meetings (EGM):

  • Similar to AGM, but with more detailed explanations of the urgent matters addressed.
  • Special Resolutions passed with voting details.