We sat down with Frances Petryshen, Corporate Secretary at Caravel Law, to discuss five major benefits from hiring an external corporate secretary.
The role of a corporate secretary is often thought of as simply acting as an administrative assistant in a corporate setting. While there can be some overlap of the skills between these roles, a corporate secretary provides a host of high-level skills beyond that of an administrative assistant that will help businesses realize huge cost savings.
Hiring an external corporate secretary on a part-time or as-needed basis can be incredibly beneficial for companies of all sizes. However, many business owners are unaware of how exactly orporate secretaries can support their organization. We’ve outlined below five key benefits an external corporate secretary can have for your business.
- Support managing business-critical meetings
Trying to run corporate meetings, like AGMs, board meetings, committee meetings, set an agenda, take minutes, and prepare action items are not easy and are often tasks that you would rather keep off your plate. As a business owner or senior team member, trying to actively take part in the meeting while also capturing everything that’s important is incredibly challenging. An external corporate secretary allows the management team to focus on the meetings at hand while using their skills to assist with some of the processes the management team doesn’t have time for.
- Helping with the due diligence process
When companies are doing an audit, financing, joint venture or other corporate transactions, a qualified external corporate secretary can support the due diligence process. They can deal directly with all the administrative tasks related to the due diligence process by providing requested documentation, for example, corporate records, resolutions, minutes of meetings and legal contracts. This is one more task the management team can offload onto an extra set of qualified hands to relieve some of their workload.
- Providing high level administrative skills
Many corporate secretaries are certified with the Chartered Governance Institute of Canada (CGIC) and have enhanced competencies in governance, finance, strategy and risk management. Many are also paralegals, meaning they have experience performing delegated legal work on behalf of a lawyer.
A qualified external corporate secretary would likely have years of hands-on experience working within an organization, coupled with their education and training, making them especially capable of handling high-level administrative tasks that would include the activities necessary between an administrator and a lawyer.
Experienced with heavy workloads and long hours during busy periods, corporate secretaries are familiar with managing confidential information and identifying situations in which there might be a conflict of interest with the clients they serve.
- Offering services on an as-needed basis
Start-ups, smaller companies and mid-stage businesses won’t have a need for a full-time corporate secretary, but will likely have a day or two of administrative or regulatory work a week that needs to be completed. Larger companies may have a full-time in-house corporate secretary, but are likely to have certain times of the year where they could require extra support to manage overflow work (at quarterly board meetings, AGMs or during rounds of funding, for example).
No matter the size of your organization, you can hire an external corporate secretary based on the needs of your business and the workload you have.
For a private company that wants to be listed in the future, a corporate secretary can help ensure that when they are ready to go public, all of their documentation will be compliant when it comes time for auditing and listing in order to meet the listing qualifications.
Once a company reaches a level where they require a full-time in-house corporate secretary, their external corporate secretary can also train and onboard a new hire, ensuring they are familiar with the specifics of the business, the industry and the regulatory administration tasks required within the organization.
- Cost savings
One of the most valuable benefits of using an external corporate secretary is that they can provide you with incredible cost savings on legal fees. Because many business owners aren’t aware of the services an external corporate secretary can provide, they often use their lawyers or a paralegal to complete simple administrative tasks. This is an expensive approach to take, as a retained lawyer’s hourly fees are incredibly high, and a paralegal’s services are usually more expensive than that of a corporate secretary.
An external corporate secretary can reduce your legal costs dramatically by working with a corporate lawyer to confer on the documentation required. The secretary can then provide the lawyer with copies of all the prepared files, making it more efficient and cost-effective for your business.
The tasks they can manage include handling private placement documentation, subscription agreements, regulatory approvals, distribution reports, treasury orders, warrant register, warrant exercises as well as managing stock option register and share issuances.
These cost savings can be considerable, saving companies thousands of dollars annually.
Interested in hiring an external corporate secretary for your business? Caravel Law is an alternative legal firm with over 60 qualified and experienced lawyers to help support your legal needs. Get in touch with our team to find out more.
Also, check out our Business Decisions podcast below, where we interview start-up founders and business leaders about the keys to their success and challenges along the way. Each episode is followed up by one of our lawyers discussing one or more legal issues raised. Enjoy!
The information provided in this article is not intended to be legal advice. Many factors unknown to us may affect the applicability of this content to your particular circumstances.