Traditionally, the role of the company secretary remained administrative-oriented, in the sense that duties were limited to providing assistance to the board members. Such duties included preparing board agendas, compiling board packs, drafting minutes and action points, and more generally, keeping the company’s records up to date.
Nowadays, the company secretary no longer simply acts as administrative support. The role of the contemporary company secretary now covers a wide range of tasks and responsibilities, including professional guidance on good corporate governance standards and practices. Additionally, a good company secretary now requires leadership and emotional intelligence skills and must nurture a culture of adherence to legal and regulatory matters. With the increased burden of regulation, board members need guidance to make better decisions and hence require a real expert who is effective up to date on the latest governance developments, and able to keep board members informed on new legislation and how it applies to the company they manage.
Not only do board members rely on the leading role of the contemporary company secretary, they also count on him/her to change boardroom dynamics. More particularly, a few additional company secretarial duties have developed over the past few years, most probably as a result of the COVID-19 pandemic, with board meetings being held in a hybrid format (in-person and virtual attendance). Very often, company secretaries are now asked to support the chairperson and board members in facilitating meetings, projecting supporting materials on the screen and “scrolling” the board pack, simultaneously following up with presenters via email, monitoring the lobby for participants joining remotely, managing the running order and dealing with IT connectivity. All of these tasks, in addition to effective minutes taking.
But how could a company secretary achieve his/her primary duties as quality minutes taker and gatekeeper for good corporate governance proceedings when he/she has to manage all the aforementioned tasks and even conduct the board meeting, especially when the focus is made on the quality of minutes and level of details?
The response is simple: if you wish to have an effective governance framework in place, it is impossible to do so on your own. These tasks are not compatible with the primary purpose of minutes taking and expected intervention during board meetings.
What are the limits?
While it is okay for a company secretary to lead board members through housekeeping matters, such as the constitution of the meeting or review of the matters arising, it cannot be done for the entire meeting. A company secretary cannot replace the role of the chairperson but instead should support the role in ensuring that there is an effective decision-making environment that would enable a proper recording of discussions and decisions. On a similar note, while a company secretary should be able to multitask, he/she cannot focus as much on listening during the board meeting if too much attention is devoted to the other aspects referenced above.
In conclusion, while the role of the company secretary in the boardroom has significantly evolved and become increasingly critical, the focus should remain on advising board members on key governance matters, ensuring they have all the elements needed to make proper decisions and take effective minutes. It is vital that those limits be well defined amongst the chairperson, board members, and company secretary and that sufficient human force be put in place to ensure good governance.
In response to all the challenges and pressure contemporary company secretaries are currently facing, and considering that the role is too often misunderstood or simply lacking awareness, why not define a dedicated framework for them or involve additional resources to effectively support them? To do so, ILA is heavily working on the recognition and formalisation of the contemporary company secretary function in Luxembourg, what we now call the corporate governance officer (the “CGO”), with the aim to prove the critical role played by company secretaries in today’s corporate world.