Understanding Corporate Resolution: Frequently Asked Questions
A corporate resolution helps to guide your company’s decision making and often serves as evidence of a company’s contract commitment or agreement2 min read
A corporate resolution helps to guide your company’s decision making and often serves as evidence of a company’s contract commitment or agreement. The key components of a corporate resolution include: approval of the decision, decision to be made, whom it applies to, decision type, and the result of the decision. But there are many other factors to consider when drafting a corporate resolution, and the process can be complicated. This article will answer some of the most frequently asked questions about corporate resolutions, so you can stay on top of your company’s legal paperwork and decision making.
First, what is a corporate resolution? Corporate resolutions are a document that outline a company’s decisions. This document provides legal proof of the decision, and captures the intention in writing, for use as evidence in the future.
Why should you care about corporate resolutions? Corporate resolutions can provide protection for company officials from legal or ethical challenges. They can help protect both the company and the individual in the event of a dispute. Corporate resolutions can also help prevent fraud and abuse, as they provide an official record of a company’s intentions.
Do I need to hire an attorney to help with the corporate resolution process? Depending on your situation, you may want to consult with an attorney to ensure that the resolution is legally valid. An attorney will be able to advise you on the legal requirements for your particular jurisdiction and will be able to help you to ensure that your corporate resolution is legally sound.
What should a corporate resolution include? A corporate resolution should include provisions for:
- Approval of the decision – to validate that the proceedings have been properly conducted and that due process has been followed.
- Who the decision applies to/who is included in the decision – to identify the individuals who are affected by the decision.
- The type of decision that is being made – the type of decision that is being taken, i.e., a loan agreement, the terms of a negotiation, or the appointment of an officer, etc.
- The result of the decision – i.e., the consequence or result of the decision.
Do I need to file my corporate resolution with the state where my company is incorporated? Yes. You should file your corporate resolution with the Secretary of State’s office in the state where your company is incorporated. Depending on the type of resolution, you may also need to file it with the local county clerk's office.
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