The Vital Role of Secretarial Services in Corporate Governance – Series 3 

Introduction

Within the intricate landscape of corporate governance, secretarial services play an indispensable role. They ensure that organizations, regardless of their size, operate in compliance with the law and adhere to the highest standards of corporate governance. In this article, we will explore the multifaceted world of secretarial services, shedding light on their critical significance, responsibilities, and the expertise required to serve Nigerian businesses effectively.

The Types of Companies that Benefit from Secretarial Services

Secretarial services are important in corporate governance because they help to ensure that organizations comply with the law and adhere to the highest standards of corporate conduct. Secretarial services can benefit a wide range of organizations, including:

• Public companies: Public companies are subject to the most stringent regulatory requirements, so they need the expertise of a company secretary to ensure compliance with the law.
• Private companies: Private companies may not be subject to the same level of regulation as public companies, but they can still benefit from the services of a company secretary to improve their corporate governance practices.
• Non-profit organizations: Non-profit organizations are also subject to regulatory requirements, and they can benefit from the services of a company secretary to ensure that they are responsibly using their funds.
• Government agencies: Government agencies are also subject to regulatory requirements, and they can benefit from the services of a company secretary to ensure that they are operating in a transparent and accountable manner.

The Role of Company Secretaries

In the complicated nature of corporate governance, secretarial services are indispensable. They ensure that organizations, both large and small, operate in compliance with the law and adhere to the highest standards of corporate governance. Company secretaries play a vital role in upholding these principles. Let’s delve into their key responsibilities:

1. Compliance: One of the most vital functions of a company secretary is to ensure that the company remains compliant with the ever-evolving landscape of laws and regulations. Ranging from the Companies and Allied Matters Act (CAMA) to sector-specific laws, such as the Investments and Securities Act (ISA) and the Financial Reporting Council of Nigeria (FRCN) Act, public companies in Nigeria for instance are subject to various regulatory frameworks. The company secretary stays abreast of legal developments, including rules and regulations issued by the Securities and Exchange Commission (SEC) and the Nigerian Stock Exchange (NSE). They implement these requirements within the organization, ensuring adherence to accounting and auditing standards, disclosure obligations, and guidelines related to public offerings, mergers and acquisitions, insider trading, and more. Compliance also extends to the company’s internal rules and policies, as well as regulations set by the Central Bank of Nigeria (CBN) for companies operating in the banking sector.
2. Role of Company Secretary in Annual General Meetings (AGMs): The company secretary plays a crucial role in the preparation and organization of Annual General Meetings (AGMs). They ensure compliance with legal requirements regarding notice periods, agenda items, and voting procedures. The company secretary assists in drafting the AGM agenda, prepares relevant documentation, and coordinates the meeting logistics. During the AGM, they serve as a point of contact for shareholders, addressing queries, facilitating voting, and ensuring that all proceedings are conducted following applicable laws and regulations.
3. Board Support: Company secretaries keep the board’s machinery running smoothly. They facilitate meetings, prepare agendas, and ensure that decisions made by the board are carried out effectively. They play an advisory role by guiding the directors on their duties, ethical responsibilities, and the legal implications of their decisions. The company secretary’s responsibilities extend to board meetings and sub-committees, such as the audit committee, remuneration committee, and risk management committee. They support the smooth functioning of these meetings by facilitating their organization, preparing agendas, and ensuring that relevant documentation is provided to board members in a timely manner. The secretary plays an essential role in capturing accurate minutes of the meetings, which serve as an official record of board decisions and actions. Additionally, they provide guidance to board members on their duties, ethical responsibilities, and the legal implications of their decisions, fostering good corporate governance practices throughout the organization.
4. Record-Keeping: Company secretaries are the custodians of the company’s history, responsible for maintaining a comprehensive record of the company’s actions and decisions. This meticulous record-keeping not only ensures transparency but also safeguards the organization against legal disputes and regulatory inquiries.
5. Effective Communication: Company secretaries serve as conduits of information, ensuring that shareholders, directors, and management are well-informed. They disseminate important information between the board and shareholders, managing external stakeholders such as regulatory authorities.
6. Ethics and Integrity: Company secretaries play a critical role in upholding the ethical and moral values of the organization. They act as guardians of the company’s code of conduct and are often the first point of contact for reporting ethical concerns or whistleblowing. This ensures that the company maintains trust among stakeholders.
7. Risk Management: Company secretaries play a crucial role in the effective management of risks within an organization. They work closely with the board of directors and executive management to identify, assess, and mitigate risks that may impact the company’s operations, reputation, and financial stability. This involves conducting risk assessments, developing risk management policies and procedures, and implementing appropriate controls and monitoring mechanisms. Company secretaries also ensure that the board and management are informed about emerging risks and changes in the risk landscape, enabling them to make informed decisions and take necessary actions to protect the company’s interests.
8. Corporate Social Responsibility (CSR): Secretarial services also encompass the promotion and implementation of corporate social responsibility initiatives. Company secretaries help develop CSR strategies aligned with the organization’s values and goals, ensuring that the company operates ethically and responsibly. They facilitate the integration of CSR practices into the company’s operations, monitor compliance with relevant regulations and standards, and report on the company’s CSR activities to stakeholders. By incorporating CSR into their governance framework, organizations can enhance their reputation, build positive relationships with stakeholders, and contribute to sustainable development.
9. Industry-Specific Governance Frameworks: Depending on the sector or industry in which a company operates, there may be specific governance frameworks and regulations that company secretaries need to navigate. For example, the financial sector may have additional requirements imposed by regulatory bodies such as the Central Bank of Nigeria (CBN). It is the responsibility of company secretaries to stay updated on industry-specific governance practices, regulations, and guidelines, and ensure that their organization complies with them. This may include specific reporting requirements, risk management protocols, and governance structures tailored to the industry’s unique characteristics.

Conclusion

In the context of Nigerian businesses, where legal and regulatory changes are frequent, the expertise of a company secretary is indispensable. Their ability to stay updated and translate complex legal jargon into actionable compliance measures is vital for safeguarding the organization’s reputation and stability. By entrusting your corporate governance needs to Highlaw Chambers, you can be assured of receiving exceptional support tailored to your specific requirements. Our dedicated team of legal professionals, well-versed in the laws and regulations governing private and public companies in Nigeria, is committed to providing tailored solutions that enhance your company’s governance framework. Together, we can navigate the intricacies of corporate governance, upholding ethical standards, promoting transparency, and building robust stakeholder trust.