THE ROLE OF THE COMPANY SECRETARY
1.1Requirement to appoint a company secretary
It is already understood that a company is the creation of law, having rights, duties and obligations just as that of human being. The so-called legal entity may therefore sue and be sued: Salomon’s case.
But because of the abstract nature of a company as a ‘person’ it becomes necessary that human agents (directors) be put in place to see to the effective running of the corporation. However, the directors are not required to be lawyers nor know anything about company law. In the same regard, the promoters (possibly also the owners) of the company need not be lawyers or know anything abut company law.
But a company being an artificial person, created by operation of law, must subsist as a person on law – it must continue to obey the provisions of the law since it derives its existence as a person from it.
Therefore it becomes necessary that the company be run effectively in a manner that conforms to the statutes and other regulations and best practices hence the need for a Company Secretary.
The position of a company secretary is created by the law creation of law in section 293 -298 of the Companies and Allied Matters, Act, 2004 which provides for the appointment and functions of the Company Secretary, with special reference to public companies.
1.2The nature of the roles, functions and duties of a company Secretary The company secretary is an officer of the company that plays a major role in the governance and administration of the company’s affairs with particular responsibilities in three major areas: company, the board and the shareholders.
1.2.1Responsibilities to the Company:
His/her responsibilities to the company will vary from simple to complex. As the company secretary he ensures that the company complies with the appropriate regulations and with the provisions of the Companies and Allied Matters Act (CAMA), 2004 and other specific legislations and regulations which are peculiar to the industry in which his company operates. For example the Company Secretary of the Bank should know more about prudential guidelines, Banks and other Financial Institutions Act, (BOFIA) 2004 while his/her counterpart in the Insurance company must of necessity be familiar with Insurance Acts, the NAICOM rules and so on.
To this end the statutory functions of the Company Secretaries will vary from company to company but the central objectives and nature of his duties to the company (as a legal entity) will remain compliance.
The nature of compliance in most cases is the rendition of statutory returns (covered in subsequent chapters) to the appropriate government agencies, e.g., Corporate Affairs Commission, for listed companies this will include the Nigerian Stock Exchange and the Securities and Exchange Commission.
The Company Secretary’s duties to the his/her company will extend safeguarding the business activities of the company from becoming illegal, for example ensuring that business contracts are entered into in accordance with the applicable laws.
1.2.2Responsibilities to the Board:
The Company Secretary co-ordinates the activities of the Board through the chairman and make available to all the directors, professional advice on statutory compliance matters. He also ensures that adequate information is given to all the board members at the same time and in sufficient detail and timely. As a matter of standard and general practice the Company Secretary must in relation to his duties to the Board do the following:
1. Communicate Board decisions to the management.
2. Obtain Board’s approval on matters that are reserved for the directors before implementation 3. Advise the directors generally on matters of procedure and best practice. This is why it has become anachronistic to...