All Singapore companies are required to appoint a company secretary within 6 months from the date of its incorporation. The secretary must be a Singapore resident, and the position should not be left vacant for more than 6 months at any time. Directors of the company can serve as the role of the secretary. However, for companies that have only one director, appointing the director as secretary concurrently is prohibited.
Notwithstanding that there are no statutory provisions of the duties and responsibilities of a company secretary in the Companies Act, the company secretary is nonetheless expected to conduct administrative and reporting duties required by law. There directors therefore must ensure that the appointed person possesses “the requisite knowledge and experience to discharge the functions of secretary of the company”[1].
A company incorporated in Singapore must appoint at least one Company Secretary within 6 months from the date of its incorporation[2]. The secretary is appointed by the board of directors, accompanied by a board resolution for appointment. Section 171(1A) of the Companies Act provided that appointing a suitable and qualified secretary is the responsibility of the directors. Under Section 171(1AA)(b), there are further provisions that the company must select individuals that “satisfies such requirements relating to experience, professional and academic requirements and membership of professional associations, as may be prescribed”. Consent to act should be procured from the secretary prior to appointment.
Qualification of a Company Secretary
The Companies Act, Section 171 (1AA), provides that a company secretary of a public company in Singapore must be suitably qualified, and has to satisfy at least one of these criteria:
- has been a company secretary of a company for at least three of the five years immediately before the appointment as company secretary of the public company
- a qualified person under the Legal Profession Act (Cap. 161)
- a public accountant registered under the Accountants Act (Cap. 2)
- a member of the Institute of Certified Public Accountants of Singapore
- a member of the Singapore Association of the Institute of Chartered Secretaries and Administrators
- a member of the Association of International Accountants (Singapore Branch)
- a member of the Institute of Company Accountants, Singapore
The Office of the Company Secretary
The office of the secretary may be vacated upon the resignation, dismissal by the board, or death. It is provided under Section 171(4) of the Companies Act that the office of the secretary shall not be left vacant for more than 6 months at any one time. During the time of vacation, the deputy secretary, if any, should assume the function until a new Secretary is appointed[3].
For the purpose of small companies, usually the secretary plays the administrative role of ensuring compliance of the company in terms of record-keeping and statutory filings. In more established companies, more sophisticated responsibilities concerning the compliance with the law are expected. Therefore, familiarity with the law and regulation is essential in the selection of a qualified secretary.
The role of the company’s secretary depends on who the secretary is answering to. The list provided below is non-exhaustive:
To the Company:
- Ensures compliance of all relevant legal obligations at the best interest of the company
- Ensures good corporate governance
- Present at the registered office of the company’s registered office address regularly
To the Board:
- Role of an advisor the directors on compliance and regulatory issues
- Reporting of regulatory updates and legislative changes
- Communications of timely information and notices with the directors
- Communications with directors on matters relating to board and general meetings
To Members/Shareholders and Investors:
- Timely and periodically communicate updates with shareholders and investors
- Maintenance of good relations with investors and shareholders
- Timely circulations of financial statement, general meeting notices and annual reports
The responsibilities of a company secretary include, but not limited to, the following:
1. Updating of ACRA Records
- Appointment, resignation or death of company officers
- Updating of officers’ particulars
- Annual Returns Filing
- Conducting of share allotment exercises
- Share transfer procedures
- Changes in company’s particulars
- Amendments or Restatement to Articles, Memorandum or Constitution of the Company
2. Maintenance and Updating of Statutory Registers
- Preparation and filing of Board Resolutions
- Company charges
- Minutes books maintenance
- Maintenance of company’s registers
- Ensure EROM is updated
- Circulations and communications of official documents such as notices, financial statements, company accounts etc.
3. Board and General Meetings Preparations
- Circulation of notices
- Communication of financial reports
- Attendance and minutes taking
- Drafting of meeting agenda
- Drafting of director’s resolutions
4. Other Administrative Roles
- Ensure compliance to filing deadlines
- Safekeeping of the Seal of the Company
- Maintaining shareholders and investors relations and communications
Fiduciary Duties of a Company Secretary
As the Companies Act recognizes the company secretary to be an officer of the company, the secretary owes a fiduciary duty to the company to always:
- act in the best interest of the company
- avoid conflict of interests
- carry out duties with reasonable care and diligence
- never make illegitimate profits from personal dealings for/with the company
It is a company secretary’s power to authenticate documents or formal proceedings of the company. A company secretary can issue certified copies of the company’s resolutions along with any one of the directors. An example would be when the company needs to open a bank account, the secretary’s certified copies of the resolutions are usually required.
Many times, the role of the company secretary has been downplayed and regarded as a cost of compliance which would be otherwise unnecessary, if it is not because the law requires it. After all, corporate secretaries do not contribute directly to the sales and performance of the company. However, in times of crisis, especially when disputes amongst stakeholders occur, whether the secretary has done a good job over the years can become critical. Therefore, companies must realize the importance of appointing a qualified and responsible secretary for the company.
About the Author
Mr. Boo Kok Chuon is the CEO and founder of our sibling company, Iconomy Holdings Pte Ltd. He is a serial entrepreneur and currently holds directorship in multiple companies, as well as a financial economist by training. Outside of his professional career, Mr. Boo is a classical and jazz music enthusiast, he plays the piano and violin at his free time.
[1] Section 171(1A) of the Companies Act
[2] Section 171 of the Companies Act
[3] Section 171(4) of the Companies Act
