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However from 6th April 2008 the position of Company Secretary will become voluntary in all private companies, including large private companies and private companies that are subsidiaries of public companies. The tasks done by company secretaries will not disappear. If the directors of a private company decide to dispense with the services of a company secretary they will still have to ensure that all the legal obligations are done because the penalties for an oversight could be painful. Many boards will no doubt choose to continue to have a company secretary. In the case of a company registered after 6th April the founder members of the company will decide whether to have a company secretary or not and word the company's articles accordingly. Company secretaries of existing private companies will not automatically lose office on 6th April 2008. They will continue until the directors decide otherwise or, just possibly, the articles are altered. Sue Jenner, Company Secretary and a Director of The Thomson Corporation plc, recently wrote an article for The Company Law Resource Centre questioning the rationale behind the decision. She reminded us that a company secretary's statutory powers are to authenticate a company's documents and to be co-signatory for the execution of documents by the company. She pointed out that many private companies are often huge operating subsidiaries of listed public companies that are bigger than many public companies. By contrast she highlighted the fact that many public companies are small. She justifiably argues that the governance of large private companies is equally as important as that of public companies. To read all of Sue's article please click here. The seminar, The Definitive Guide to Implementing the new Companies Act, highlights 24 other changes to company law which will take effect on 6th April 2008. It also explains the changes that should already have been made and those that will be implemented later in the year and during next year. Who is this e-mail from? |
Many people decided to lobby the Government when, in June 2006, the Government proposed in the then Company Law Reform Bill not only to make the position of Company Secretary voluntary for private limited companies, but also to strip company secretaries of all their existing powers. Common sense prevailed. The lobbyists won the day and the original proposals were modified; company secretaries, where they exist, will not lose their powers and their details will continue to be registered at Companies House. |
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