Board resolutions are a formal method of recording and documenting decisions made during a board meeting. They guarantee that the decisions taken are in line with the state, federal and local laws and regulations. They also limit the legal risks that could result from these choices.

The board must keep a record of all decisions, no matter how small or significant they may be. The board must also be able to demonstrate the rationale behind the decision, so that anyone who isn’t on the board can understand why it was made and if it was the right decision.

Composing a board resolution is an overwhelming task. However, by learning on the purpose of these documents and using the right tools to create them you can simplify the process.

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

When the board makes crucial decisions that affect shareholders or the company, they must document these in a formal manner. These decisions are referred to as resolutions of the board. They help establish clear policies regarding ethics and governance. They are also used to demonstrate the board’s commitment to corporate transparency.

Board resolutions can be voted on during a board meeting or in more modern times, they can be approved through written resolutions. When the resolution is written, it must begin with an “WHEREAS” statement that highlights the issues discussed at the meeting prior to moving on to the resolved statements. After the document has been completed and signed by all directors present at the meeting.

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