Corporate Compliance, Best Practice and Company Secretaries
The role and duties of the UK Company Secretary are often overlooked by a board of directors focussed on managing an SME, especially in the current climate. This is heightened by the fact that said SMEs are not required to appoint a company secretary, potentially increasing the risks arising from a dearth of available skillset at board level, focussed on corporate governance.
The duties of the company secretary will vary from company to company, according to corporate size, quoted or unquoted and existing in-house skills. However, as a general guide, where an SME opts to put a company secretary in place, then those duties should include:
- Supporting the Board of Directors in carrying out their board functions in a compliant manner
- Ensuring open communications between the Board, shareholders and remaining stakeholders
- Maintaining compliance with the latest corporate regulations impacting the company, and
- Being responsible for corporate administration including management of board meetings, shareholder meetings, statutory filings and so forth.
Where a company secretary is not appointed, the above tasks (which are not exhaustive) lie with the directors or a nominated party and it is easy to fall into the trap of thinking that no specific skill sets are needed…
Attention should be given by UK corporates, whether they are subsidiaries of international parents or free-standing local country entities, to the raft of legal requirements that, unaddressed, leave the corporate and the individual board directors, with an unacceptable exposure to risk.
Focussing on enhancing the necessary to attain best practice, the company secretary would also be responsible for the creation, implementation and management of essential aspects such as: Anti-Money Laundering [AML], Data Protection [GDPR], Anti-Bribery and Corruption [ABC], Corporate Criminal Offence [CCO], etc. For best practice, and depending upon the board’s appetite, its focus on Environment, Social and Governance [ESG], amongst other facets, would also reside within this role.
This is often where Briars steps in to support the company, irrespective of its status (e.g. Special Purpose Vehicle, overseas subsidiary, etc.) Sadly, we also see occasions where support is sought after the threat has become reality.
As Brexit impacts, we expect to see a raft of changes to underlying corporate compliance impacting all businesses with an interest in the UK. We will report on these over the months ahead. At this stage, one minor change worth comment relates to our friends across the water in Ireland where, with effect from January 01, 2021 Irish companies that previously accepted a UK national as a director will no longer do so. As set out in the Irish regulations, those companies must include one director who is an EEA resident, although there are workarounds. Please reach out to us at firstname.lastname@example.org to discuss.
As a final thought, in these days of heightened risk, increased corporate compliance and statutory burdens hitting SMEs it would be wise for the officers of the company to ensure that their houses are in order. As we move into 2021 and beyond we can expect to see those changes not only to the existing regulations but also new approaches to aspects including supply chain, modern slavery, employee protection and so forth. SMEs may face unwelcome hefty costs and serious damage to brand reputation if they choose not to practice on a fair and compliant platform.
If you have any questions concerning your existing compliance or are seeking to put in place the necessary requirements then please feel free to reach out to us at email@example.com We would also refer you to the existing information on CCO.