To enter the world market and gain attractiveness for lenders to investors, it is necessary to establish management. To increase the efficiency of the company, the law added a new position to the state - the corporate secretary.
This person is the face of the company. Thanks to him, the secretary, there is an interaction between company employees - the board of directors, top managers and owners of the joint-stock company.
International and Russian practice
In foreign companies, the company secretary or company secretary appeared long ago and occupies a significant position in the corporation. He is the pivotal link in the administration of the main areas of the company. This is most likely due to the level of management and business traditions that have developed in different countries.
Legal regulations in certain countries oblige large public joint-stock companies to have this position in their staff. For instance:
- Companies Act 1985 (UK).
- 1991 Corporations Act (Australia).
In 2002, Russian companies mentioned the functions and powers of corporate secretaries. An authorized commission at the federal level on the securities market developed a Code of Corporate Conduct, approved by the Government of the Russian Federation in the same year.
First of all, this position had to be introduced into its staff by joint-stock companies, due to which positive results were noticeable after a certain period of time.
Corporate Secretary in Russia
Working as a corporate secretary is a big responsibility. He is the guarantor in relations between the board of directors and other members of the company. The secretary protects the interests of all parties by complying with legislative and internal by-laws.
Thanks to the settlement of conflicts, channels between the board of directors and the board are noticeably established. Increased control over the implementation of the proposed solutions and information processing, which contributes to a more balanced and productive management.
Who is this job for?
Before choosing someone for this responsible position, it is worth deciding on the official duties of the secretary of the company. The list of duties included in the performance of the corporate secretary is quite wide. For example, this is assistance to council members and the committee in providing professional advice, information coverage, organizing and holding shareholders meetings, resolving conflict situations, maintaining internal documentation and any corporate actions within the law. This list is not complete, but thanks to it you can understand who should be entrusted with this position.
In practice, it has been observed that lawyers most often fulfill the duties of secretary of society. In favor of them speak such qualities as knowledge of laws, record keeping and information disclosure. They are able to provide legal protection and professional assistance. The weaknesses are the lack of organizational skills, lack of knowledge about holding meetings of shareholders.
The head of the legal department can be a pretty good corporate secretary. Unlike an ordinary lawyer, he has managerial skills. At his disposal is a team of employees that performs small assignments. The disadvantages of such a candidate include the reluctance to do small work and the fact that the company can be quite expensive.
Quite often there is a chief accountant who combines the work of a secretary. Most likely, this appointment is promoted by the frequent fulfillment by him of the duties of other employees. True, there are more minuses than pluses. Positive can be called document management and the performance of a uniform work. The disadvantages are the lack of knowledge of corporate governance, corporate legislation, conflict resolution skills, lack of legal education and competence in organizing and conducting shareholders meetings.
From the above information, we can conclude that no one can completely replace the company secretary. The corporate secretary of the company has the necessary knowledge in full. True important are the personal qualities of a person, his desires and aspirations.
Key job requirements
High responsibility implies high demands. The appointment to a position as corporate secretary is the responsibility of the board of directors.
The main requirements can be distinguished:
- Higher education (legal or economic).
- Knowledge of stock markets (Russian and foreign).
- Knowledge of the laws of the Russian Federation regarding stock law, drafting regulations.
- Experience in the field of management, knowledge of the basic standards of the Russian and international standards of corporate governance and economic and financial activities.
- Responsibility, sociability, a sense of humor and high resistance to stress. As well as responsibility, the ability to manage conflict situations, organizational and analytical skills.
- Free use of PC.
If securities of the company of shareholders are included in the lists of foreign exchanges, the corporate secretary must understand international law.
A corporate secretary may have several employees performing certain functions. Depending on the size of the company, their number can reach seven people. The secretary of the organization itself can be accountable to the board of directors or to the general director.
Position Benefits
The importance of such an official unit as a corporate secretary, whose responsibilities cannot be underestimated, is difficult to overestimate. He is able to influence the success and fruitfulness of the aspirations of the company. The lack of communication between the links in the hierarchical chain in a company can lead to many problems. Such problems as criminal and administrative liability, corporate conflicts, loss of reputation of a joint-stock company, and a possible decrease in stock prices can be highlighted.
The trust of investors and shareholders depends on the reputation of the company. They expect that the management team will act in their interests. The secretary of the association will most effectively cope with this task, the tasks and functions of which are specified in the charter and code of the joint-stock company.
Main functions
The functions of the corporate secretary are described in detail in the Code of Corporate Conduct. The importance of the role of this position in the company is indicated by such powers as:
- notification of all persons participating in the meeting of shareholders;
- making a list of those who will attend the meeting;
- distribution of ballots to the shareholders of the meeting;
- providing access to necessary information;
- distribution of certified copies of materials required by shareholders at the meeting;
- counseling and answers to questions of interest to all during the meeting;
- collection and transfer of completed ballots to the counting commission;
- providing information on the final results of the vote;
- legal advice and protection of shareholder rights.
Training
There is the possibility of further training in such a position as a corporate secretary, training will help in this. With increasing demand, higher pay, and great demands on the profession, all kinds of educational institutions and seminars in Russia on the topic of business have appeared. It is possible to take corporate secretary courses.
Conclusion
Having adopted the experience of foreign companies, Russian companies are developing the effectiveness of the institution of corporate secretaries, and practice creating successful organizational activities. They are trying to demonstrate changes in the transformation of corporate governance on the positive side, thereby enhancing the image of Russian joint-stock companies.