In Ireland, every company is legally obliged to appoint a company secretary. The company secretary is a communicator, facilitator, and legal advisor to the board and the company's shareholders. The company secretary also has ongoing communications with regulatory authorities such as the Companies Registration Office (the "CRO") and Revenue Commissioners. The company secretary should be independent when providing advice, suitably qualified and aware of the rights, duties and obligations of directors, shareholders and other third parties.
What Is A Company Secretary?
A company (or chartered) secretary‘s appointment is based on the concepts of trust and independence, reflecting the confidentiality of the role. Company secretaries generally are one of the company's named representatives on legal documentation, and it is their responsibility to ensure that the company and its directors operate within the remit of their roles, providing guidance to enable compliance with relevant legislation.
Who Can Act As A Company Secretary?
In Ireland, a company secretary can be a legal or natural person. There is no legal requirement for the company secretary ("the secretary") of a private company to have professional qualifications or any previous experience.
There are specific legal requirements for the appointment of a company secretary for a publicly traded company. The secretary (or, each joint secretary) of a public limited company must prove to the directors to have the necessary knowledge and ability to fulfill the function of the position.
The company secretary may be qualified by way of membership of the Institute of Chartered Secretaries and Administrators (ICSA), which is the qualification specifically available for company secretaries. Chartered secretaries are employed as chairs, chief executives and non-executive directors, as well as executives and company secretaries. Some chartered secretaries are also known in their own companies as corporate secretarial executives / managers or corporate secretarial directors.
How Important Is The Role?
The Cadbury Report (1992) stressed the importance of the role of the company secretary:
‘‘The company secretary has a key role to play in ensuring that board procedures are both followed and regularly reviewed. The chairman and the board will look to the company secretary for guidance on what their responsibilities are under the rules and regulations to which they are subject and on how these responsibilities should be discharged. All directors should have access to the advice and services of the company secretary and should recognise that the chairman is entitled to strong support from the company secretary in ensuring the effective functioning of the board.’’
With the increasing focus in recent years on corporate governance in Ireland, compliance and corporate governance are of concern to every business. Failure to comply with company law and regulatory requirements can have damaging consequences, in terms of financial penalties and damage to a company’s reputation.
Growing Role Of A Company Secretary
Given this, the role of the company secretary of Irish companies has grown in importance. In many ways, the company secretary is now seen as the guardian of the company’s proper compliance with both the law and best practice.