Except in the case of a small company, every company shall have a Secretary, so says Section 330 of the Companies and Allied Matters Act 2020, CAP. C20, Laws of the Federation of Nigeria. By secretary, I do not mean a receptionist or a customer care practitioner; neither do I mean a person who just assists with correspondences or making appointments nor that stern looking woman who sits in front of the Executive- Director’s office and acts like she’s the gate-keeper to the Promised Land. By Secretary, we mean a corporate officer in charge of the official correspondences of the company, minutes of board meetings, and records of stock ownership and transfer.
A company secretary is appointed and can be removed by the Directors of a company, and like the Directors of a company, the secretary plays a very important role in the company’s daily administration. A company’s secretary is more or less the company’s compliance officer who uses requisite skills to carry out secretarial functions in the company. The part played by the Company Secretary is further strengthened by the Corporate Affairs Commission (CAC) directive that all companies except small companies appoint a Company Secretary and file evidence of same before the commission.
The company secretary is an officer of the company who plays a major role in the governance and administration of the company’s affairs. CAMA, in Section 335 provides that the functions of a Company Secretary includes;
- Attend the meeting of the company, the board of directors and its committees, rendering all necessary secretarial services in respect of the meeting and advising on compliance by the meetings with the applicable rules and regulations;
- Maintaining the registers and other records required to be maintained by the company under this Act;
- Rendering proper returns and giving notification to the commission required this Act; and
- Carrying out such administrative and other secretarial duties as directed by the director, or the company.
In addition to the provision of CAMA, the Nigerian Code of Corporate Governance 2018 recognises the statutory duties of a company’s secretary. Principle 8 of the Nigerian Code of Corporate Governance 2018 provides that the company secretary plays an important role in supporting the effectiveness of the board and management to develop good corporate governance practices and culture within the company.
Reasons Why Your Company Needs a Secretary
- It is the duty of the Company Secretary to maintain certain statutory registers on behalf of the company including;
- Register of members and shareholders.
- Index of members where they are more than 50.
- Register of Debenture Holders
- Register of Directors/ Secretaries.
- Accounting records
- Register of charges, and
- Register of interest in shares.
- The company’s secretary ensures that the company complies with appropriate regulations notably CAMA and other specific legislations and regulations which are peculiar to the industry in which the company operates. The company’s secretary ensures that the company’s statutory returns, all necessary documents and changes in the company are filed as required by law.
- The company’s secretary acts as a communications intermediary between the Board of Directors and the shareholders by notifying the shareholders about the decisions of the board.
- The secretary advises the board on matters of procedure and best practices.
- The secretary in conjunction with the chairman ensures that board meetings are conducted properly.
- The company’s secretary ensures the proper use and safe custody of the company’s seal.
- The company’s secretary is responsible for registering shares and supervising the company’s registrar when the company is listed.
Furthermore, a secretary does not owe fiduciary duties (duty to act with good faith) to the company except where he is acting as its agent, then he shall owe fiduciary duties to it, and as such shall be liable to the company where he makes secret profits or lets his duties conflict with his personal interests, or uses confidential information he obtained from the company for his own benefit (Section 334).
To be a Company Secretary, such person must have the requisite knowledge and experience to discharge the functions of a secretary, and in the case of a public company, he shall be either a member of the Institute of Chartered Secretaries and Administrators; or a legal practitioner; or a member of the Institute of Chartered Accountants; any person who has held the office of public company secretary for a period of 3 years of five years immediately preceding his appointment; or a corporate body or firm consisting of the above mentioned people (Section 332).