Board resolutions are a formal way of recording and documenting the decisions made at an upcoming board meeting. They aid in ensuring that the choices made are in line with federal, state and local laws and regulations. They also limit the legal risks that could result from these choices.

The board must keep a written record of any decisions, regardless of how minor or significant they might be. The board must also be able to provide the rationale of the decision so that anyone who isn’t a member of the board can understand the reasons behind the decision and whether it was the right choice.

Making a resolution for a board is an intimidating task. If you know the purpose behind these documents, and employing the correct tools to create them and make it easier.

A Board Resolution: What is it is and how to write one

The board must document important decisions affecting shareholders or the company in a formal way. These decisions are called resolutions of the board. They help establish clear policies in areas like ethics and governance. These resolutions are also used as a way to demonstrate the board’s commitment to transparency of the company.

Board resolutions can be passed at a physical meeting of the board or, more recently, via written resolutions. If a resolution is written, it must start with the « WHEREAS » statement that highlights the subjects discussed at the meeting, and then move on to the resolved statements. The document must be signed by every director who attended the meeting.

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