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A Board Resolution – What it Is and How to Write One

Board resolutions are an official way to record and document the decisions made during a board meeting. They help to ensure that these decisions are in line with the federal, state and local laws and regulations. They also help reduce the legal risks that could result from these decisions.

Whether the decision in question is something as minor as a change in employee hours or as important as shutting down a company the board should have a documented record of it. The board must also be able show the reasoning behind the decision, so that anyone outside can understand the reasons behind the decision and whether it was the correct decision.

Therefore, writing a board resolution can be an intimidating process. But, by being educated about the purpose behind these documents and making use of the appropriate tools to create them, you can simplify the process.

A Board Resolution: What it is and How to Write One

When the board takes important decisions that affect shareholders or the company, they need to record these decisions in a formal way. These decisions are referred to as resolutions by the board. They help establish clear policies regarding ethics and governance. They are also used to demonstrate the board’s dedication to transparency within the company.

Board resolutions can be passed at a physical meeting of the board or in recent times, via written resolutions. If a resolution is written, it must start with the “WHEREAS” statement that draws attention to the subjects discussed at the meeting, before moving to the resolutions. After the document has been completed and signed by all directors who were present at the meeting.

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