A Company Secretary is a senior person within a private or public company who provides advice to the board and ensures that the business is meeting its legal statutory obligations. While there is no statutory legal requirement for a private limited company to have a Company Secretary in place, doing so can confer enormous advantages for the organisation and its leadership team. A Company Secretary is, however, a mandatory requirement for a public company. In this article, we will explain all you need to know about the role, functions, duties and responsibilities of a Company Secretary in the United Kingdom.
What Is the Role of a Company Secretary in the UK?
A Company Secretary is a senior person within a private or public company who provides advice to the senior leadership board and plays a key role in the oversight of legal compliance, administration and stakeholder communication.
Despite its importance, the role of Company Secretary is not defined by the Companies Act 2006 (CA 2006). For this reason, the specific functions carried out by a company secretary can vary substantially between companies. Some Company Secretaries provide a predominantly administrative role, while others are much more strategic, providing advice to the board on key matters such as corporate governance, strategy, and decision-making.
What are the core functions of a Company Secretary?
A Company Secretary can provide several important functions for a private or public company in the UK. Their core functions include governance and administrative oversight to ensure the company remains compliant with the Companies Act 2006 and articles of association. The functions of a Company Secretary typically span four key areas:
- Ensuring legal compliance
- Providing strategic advice
- Administrative oversight
- Shareholder Communication
In the following sections, we will look at the role of a Company Secretary for each of these key function types.
Ensuring legal compliance
One of the essential functions of a Company Secretary is to oversee the legal compliance of the company they represent, including ensuring that the company is run in full accordance with the Companies Act 2006, the Articles of Association, and shareholder agreements. They also play a central role in making sure that the company’s statutory registers, records, and books are maintained at all times and documents are filed correctly and on time. This includes ensuring that annual filing obligations are met correctly and on time, including confirmation statements, annual accounts, directors’ reports and auditors’ reports. Other aspects of company legal compliance handled by Company Secretaries include making sure that:
- Statutory company records and registers are available for public inspection at all times
- Companies House is informed of changes – Companies are required to keep Companies House updated with changes such as those relating to share capital, directors and the registered office address. In addition, a company secretary will ensure that the company address (including the SAIL address) is correctly displayed and that changes are reflected on the company’s website and stationary.
- The company is compliant with the latest laws and regulations, including those relating to regulatory, health and safety, data protection, cyber security, human rights and employment law.
Given the breadth of their role in this area, it is easy to see why directors rely heavily on company secretaries to steer and ensure their legal compliance with the company.
Provision of strategic guidance to the board
Company Secretaries have a strong sense of what is happening across all areas of the business. This knowledge coupled with their experience means that they are trusted to provide much-needed strategic advice to the companies they represent, especially when the board are making important high-level decisions. A Company Secretary may:
- Provide advice to the board of directors, especially the chair and the non-executive directors, on strategy and other high-level matters
- Help to make effective board-level decisions
- Monitor the financial performance of the company and provide information to senior leadership, and
- Ensure the long-term continuity of the company and highlight any skills gaps at the board level
Administrative oversight
A Company Secretary may also be relied on to oversee important administrative tasks and may include:
- Organising meetings – A company secretary arranges and prepares board meetings. This involves preparing the meeting agenda, circulating documents and notices, writing meeting minutes, drafting and preparing shareholder communications and organising the annual general meeting (AGM).
- Authenticating company documentation.
- Issuing share and loan stock certificates.
- Looking after various documentation such as directors’ service contracts, property leases, and agreements for commercial equipment.
- Administering employee share option schemes.
- Administering insurance and pensions.
- Administering PAYE (Pay As You Earn) and payroll.
- VAT registration.
- Managing the company’s premises and facilities.
- Use of the company seal (if the company has one).
- Signing documents on behalf of the company director
- Appointing an auditor, if necessary
- Management of company share and pension schemes
- Oversight of payroll
- Handling the payment of tax, and
- Organising business insurance
Maintaining effective communication with shareholders is essential for large companies. The Company Secretary will often assume responsibility for the circulation of correspondence to shareholders, including:
- Announcements
- Dividend updates
- Meeting notices
- Information on shares and shareholding
- Registration of share ownership, and
- Transfer of shares
To whom is the company secretary responsible?
Company Secretaries are responsible to the company, company chair, board, shareholders, and key stakeholders.
| Responsible to | Functions provided |
|---|---|
|
The chair |
Company Secretaries often report directly to the company chair and play a key role in helping them perform their legal duties and responsibilities at all times. This may include verifying that the governance processes are in place across the business and that these are suitable, given the nature and type of company. |
|
The board |
Company Secretaries report to the board in an advisory capacity and play an important role in encouraging a healthy corporate culture. Board members often rely on the company secretary to advise them on fulfilling their:
|
|
The company, shareholders and key stakeholders |
Company Secretaries are central to how the strategy of the business is formed and disseminated through the business. The secretary also performs an external communication role, liaising with investors and other stakeholders on corporate matters. |
What are the fiduciary duties of a Company Secretary?
A ‘fiduciary’ is someone who has undertaken to act for, or on behalf of, another in circumstances which give rise to an obligation of trust and confidence. As such, a Company Secretary has fiduciary duties to the company they represent.
The fiduciary duties of a company secretary include the following:
- Duty of loyalty – Company Secretaries must never use their positions for their own private advantage; rather, they must act unselfishly in what they perceive to be the best interests of the other person.
- Duty to act with care and skill, and
- Duty to avoid conflicts of interest.
Does a Company Secretary require qualifications?
Company secretaries working for private companies do not require formal qualifications. Public companies, on the other hand, must take all reasonable steps to ensure that its Company Secretary has the necessary knowledge and experience to perform the functions of a Company Secretary, and meets one of the following requirements:
- Membership of:
- the Chartered Governance Institute (referred to in section 273 of the CA 2006 as ICSA);
- the Institute of Chartered Accountants in England and Wales;
- the Institute of Chartered Accountants of Scotland;
- the Association of Chartered Certified Accountants;
- the Institute of Chartered Accountants in Ireland;
- the Chartered Institute of Management Accountants; or
- the Chartered institute of Public Finance and Accountancy.
- Held the role of Company Secretary of a public company for at least three of the previous five years.
- Is a barrister, advocate or solicitor in the UK.
- Is a person who, because of their experience or membership of another body, appears capable of discharging the functions of a company secretary.
Final words
The importance of the work of Company Secretaries in UK companies cannot be overstated. Directors and others in the most senior positions are typically focused on strategic planning and the day-to-day operation of their business. Company secretaries act as the glue bringing the business together. As the Chartered Governance Institute (ISCA) explains, “The role of the company secretary is much more than just administrative. At its best, it delivers strategic leadership, acting as a vital bridge between the executive management and the board and facilitating the delivery of organisational objectives”.
At Uniwide Formations, we offer a range of Company Secretarial Services to make it easier to maintain statutory registers, file annual confirmation statements, and update your company’s records with Companies House. You can be assured that by using our business services, we will ensure that everything is done correctly and on time so you can focus on running your business.
Uniwide Formations specialises in registering limited companies and LLPs. We provide also a wide range of related professional business services, examples of just a few of these that are useful to a Company Secretary including:
- VAT Registration Assistance
- Confirmation Statement Service
- Dormant Company Accounts
- Change a Company Name
- Share Services – Issuing &/or Transfer
- Company Dissolution Service
