What to Include in a Corporate Resolution

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A corporate resolution formally records all major decisions made by a corporation so they may be retained for the company’s official records. Corporate resolutions can cover a wide range of topics from describing which officers are authorized to act on behalf of the company to changes in dividend distribution. The main purpose of corporate resolutions is to maintain complete and accurate records of all important actions. While they are not generally submitted to governing or oversight bodies, they are a major part of maintaining required corporate formalities. In the event of legal action against your business, these records can help to solidify the legitimacy of your company as a separate legal entity, thereby maintaining your limited liability protection.


How to Create a Corporate Resolution

Corporate resolutions are typically created during a meeting of shareholders or the board of directors. Any time there is an important matter that must be voted on, the issue will be brought up, discussed, and voted on. A corporate resolution is the signed record of each resolved item. The minutes of the meeting will also include the resolution and whether it was approved or not.

The Basics

The format and requirements of a corporate resolution will vary a bit from state to state, but most resolutions will contain the same basic elements.

  • Business Name: Your business name should be included in the title, making it clear what entity is seeking the resolution.

  • Date, time, location: You must include when and where the resolution is being passed.

  • Resolution details: Include the purpose or background of the resolution followed by a list of actions your company plans to take. Each action will be listed as a separate resolution.

  • Signatures: Beyond the signatures and date of each designated officer required to sign resolutions, there should also be a statement attesting to the acceptance of these resolutions, usually by the corporate secretary.

Each state’s format and other requirements may differ, so be sure to have your corporate attorney review the documents and ensure the resolutions meet your state’s regulations.

Examples of Corporate Resolutions

Corporate resolutions can be used to decide a number of different issues. They are particularly useful as you navigate the early days of your corporation and make important decisions on rules, leadership, financial matters, and more. Some common resolutions during this phase include:

  • Approving bylaws
  • Appointing directors
  • Appointing officers
  • Selecting a corporate seal
  • Establishing an executive office
  • Securing various government approvals
  • Scheduling board of directors meetings
  • Scheduling the annual meeting of shareholders
  • Authorizing your treasurer/administrator/CFO to open and use corporate bank accounts
  • Authorizing corporate accounts and designating authorized signers
  • Appointing a law compliance committee
  • Authorizing the issuance of shares of stock
  • Signing a lease
  • Assigning loan funds
  • Obtaining a corporate credit card

Once your corporation is established, you’ll continue to use corporate resolutions to decide and document important ongoing items such as providing advance notice of meetings, terminating directors, amending bylaws, applying for corporate loans, and spending a substantial amount of corporate funds. You will also need to use a corporate resolution if you decide to file for bankruptcy or dissolve your corporation.

Example of a Corporate Resolution

COMPANY NAME

RESOLUTION TO [ ]

WHEREAS, [Company Name] desires to…

RESOLVED:

RESOLVED:

RESOLVED:

The undersigned hereby certifies that the foregoing is a full, true, and correct copy of the Resolution of the Board of Directors of [Corporation Name].

IN WITNESS WHEREOF, I have executed my name as Secretary and have hereunto affixed the corporate seal of the above named Corporation this, [ Day of the Week], [Current Month] of [Current Year].

__________________________
Secretary, [Name] [Date]


__________________________, Director


__________________________, Director


__________________________, Director


__________________________, Director

What to do After the Resolution is Signed

After the resolution is signed, your corporate secretary will file it with your company’s official records. Your corporate resolutions can then be called upon whenever they are needed. This may occur when authorizing large bank transactions or opening new accounts, if an employee or shareholder needs to review them in the course of doing business, if your company is ever audited by the IRS, or in the case of legal action against the corporation or its shareholders.

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