At election time, board members will fairly often steer clear of the Company Secretary position. Some board members are intimidated by the position for various reasons. They may not want to do the extra work that taking board meeting minutes requires or they may not have the confidence in themselves to do a good job with it. Regardless of whether board directors take a turn filling the responsibility of the Company Secretary, all board directors should understand why meeting minutes are important; what components should be included in the recording of the minutes; how to record actions and decisions; and how to use the minutes to help guide long-term planning.
While the Company Secretary takes the bulk of responsibility for writing and recording the minutes, board members have the responsibility to review them and to make sure that the minutes stand as an accurate record of their intentions. Having the right checklist could drastically lessen the burden of the process and board administrators should be looking for the right guidance to improve their expertise.
Why Board Meeting Minutes Are So Important
Meeting minutes are important for a variety of reasons. They provide a historical record of the board’s short- and long-term planning. In addition, meeting minutes are an important record when interacting with the IRS. The IRS or auditors can challenge the record and compare the minutes with tax returns.
Company secretaries should be cognizant that the meeting minutes may be used as evidence in a court of law. Many attorneys contend that if an action wasn’t in writing, it never happened. Courts will usually consider whether the Company Secretary and the rest of the board made reasonable efforts to document the details of the meeting.
Pre-Planning and Preparation for Meetings Make Recording Board Meeting Minutes Easier
Once the board chair calls the meeting to order, things often happen swiftly—too swiftly to try to play catch-up recording some of the known information. It’s best for company secretaries to use some sort of a template for following along in the meeting.
It’s important to allow enough time for pre-planning and preparing for the meeting. Many things can be pre-filled, such as the date, time, location and type of meeting. Once the Board Chair calls the meeting to order, it’s “go time.”
Minute-takers will want to make note of whether the meeting was a regular meeting, special meeting, emergency meeting, annual meeting, executive committee meeting or some other type of committee meeting. Hopefully, the minute-taker or the Board Chair has a list of those who said they were coming and those who stated they’d be absent. It’s easy enough to move someone from the attendee list to the absentee list during or after the meeting, if necessary.
Be sure to record the time the meeting started and the name of the person who is recording and transcribing the minutes.
Taking Board Meeting Minutes
It’s important for minute-takers to know the types of information that meeting minutes need to show. It’s easy to remember what needs to be recorded when minute-takers get back to basics and remember all of the reasons for taking minutes.
Meetings drive the action the board needs to take and details the board expects who need to take action; what they need to do; and when they will complete their tasks.
A well-written agenda is a huge help for minute-takers. Agendas should be well-organized and easy to follow. Each agenda item should have a word next to it that tells the board how they are to manage the item. Descriptive words like discussion, information, action, approve, review or decision are helpful for minute-takers and the rest of the board.
Minute-takers have various perspectives on how wordy board minutes should be. It’s a generally accepted practice to include a short explanation of each agenda item and a summary of the major arguments. Some boards prefer to keep meeting minutes short so that if the minutes are called into legal evidence, the courts won’t be able to misinterpret the facts.
The minutes should also be able to show that the board gave each agenda item the time that it deserves for the board to be able to make sound decisions about it. Minutes from several meetings might show the flow of an agenda item from the initial discussion to tabling or being sent to a committee, and then being sent back to the board for additional discussions and voting.
Specific items that minute-takers need to record include reports from standing and special committees, conflicts of interest, general matters, records of proposals, resolutions, motions, seconds and final dispositions.
Recording Votes at Board Meetings
Minute-taking requires active listening skills. It’s important for minute-takers to get the exact wording of motions and resolutions. It’s perfectly okay to ask a board member to restate the motion or resolution for the record, if necessary.
If the meeting is going too fast to take accurate minutes, it’s also acceptable for the minute-taker to signal the Board Chair during the meeting and ask questions for clarification.
As voting ensues, in addition to getting the exact wording of motions and resolutions, minute-takers need to record the names of board members who made motions, seconds and abstentions and note whether they were followed by board discussions. It’s also important to record additional information, such as whether motions were amended, rescinded, approved or defeated.
Nay votes and abstentions are important because board members may have legal protection if the majority of the board approved an action where a lawsuit was later filed. Members who voted no or who abstained from the vote may be set apart from any lawsuits filed against the board or the corporation.
The meeting record should also indicate the names of board members who agreed to take action, what they’re expected to do and when they need to complete it by.
Finally, minute-takers need to record the time of adjournment and get the prior meeting’s minutes signed by the board president or whomever the bylaws state need to sign meeting minutes.
How Electronic Applications Aid in Board Minute Taking
Most boards have found the benefit of using board portals for conducting secure, confidential board business. Diligent Corporation heard the wishes of minute-takers who asked for an electronic solution to streamline the process for minute-taking.
Diligent Minutes is a software program that vastly cuts down on the time needed for minute-taking. The program pre-populates much of the information, including the date, meeting start time, time of adjournment, and names of attendees and absentees.
The program makes it easy for minute-takers to jump around various sections of the template and move the order of sections around if they wish.
Board members can vote online and even provide their signatures electronically. The features of Diligent Minutes ensure that meeting minutes are accurate, complete and reflect the board’s true intentions.
The most important work of the board happens in the boardroom when the meeting time clock is running. An electronic meeting minute solution like Diligent Minutes may be the solution that gives all board members the confidence to volunteer to serve as minute-takers.