Resolution of Board of Directors

The Resolution of the Board of Directors is a document that outlines the key decisions made by the directors at a board meeting.

Board resolutions are used to document important decisions and record the official position of the company on various matters. These decisions can be related to business operations, financial transactions, corporate governance, and other significant issues. This resolution applies to any type of company in Nigeria.

There are two major categories of board resolution, namely:

• Special Resolution: This is the decision of at least 75% of the directors of the company. This means that for a special resolution to be passed, it requires the vote of at least 75% of the directors present at a board meeting.
  
  
• Ordinary Resolution: This is more common in board resolutions. It is the decision/vote of at least 51% (majority vote) of the board of directors of the company. Some decisions that may require an ordinary resolution include: election/re-election of directors, appointment of auditors, acceptance of financial and directors reports at the general meeting, and appointment and removal of directors.

The company Articles or bylaws also specify the decisions that require either ordinary or special resolution.

Note that this document is different from a Company Resolution, which relates to decisions made by the members of the company at a general meeting.

Please note that some board resolutions may require approval in the shareholder's meeting. This may be the case for decisions such as the increase in the appointment of a new director or auditor and the acquisition of another company. For further information, please refer to the company's Articles or bylaws.

For a board resolution to be valid, it must meet the following criteria:

• The requisite quorum must be present. The quorum is the minimum number of directors that must be present in a meeting as stipulated in the Articles of Association or company bylaws. For example, if the Articles require a quorum of 8 directors to pass a resolution approving the company's financial statement, it means that at least 8 directors present at the board meeting must vote indicating their approval of the financial statement. Conversely, if a quorum is not present, the decisions made in the meeting may be invalid;
  
  
• Notice of Metting. The directors can call a board meeting by issuing a 14 days notice before the day of the meeting. Notice of the board meeting should be sent to all the directors of the company and other parties required to attend the board meeting, for example, the company auditor. The notice can be sent by physical letter or via email;
  
  
• A duly signed Minutes of Meeting. Generally, a resolution is made after a board meeting has been duly convened and held. If a properly organized and conducted meeting took place, the chairman and company secretary must sign the Minutes of the Meeting in which the resolution was adopted; and
  
  
• This resolution must be drafted and included in the company's corporate records.
  
  

How to use this document

This document can be used when the directors of a company have made decisions relating to the company. These decisions may include a change of the company's name, change of business address, change of objects of the company, allotment of company shares financing, or increase or reduction of the company's share capital.

When the document is filled, this document should be signed by either two directors or one director and one secretary.

Note that this document may be used as a supporting document for corporate filing, in instances where the resolution relates to the change of company director, secretary, auditor, business address, or other corporate changes that require filing at the Corporate Affairs Commission (CAC). In such cases, ensure to file this document along with requisite corporate forms and documents at the CAC.

Applicable law

The Companies and Allied Matters Act, 2020 applies to this document.

How to modify the template

You fill out a form. The document is created before your eyes as you respond to the questions.

At the end, you receive it in Word and PDF formats. You can modify it and reuse it.