Article explains what are the minutes, who need to maintain minutes, Are there any legal provisions which mandates organizations to maintain minutes and what is the Importance of Meeting Minutes.
Minutes are the written proceedings of meetings. These are live written records of meeting. They include the list of attendees, issues raised, related responses, and final decisions taken to address the issues. Every business organization needs to conduct meetings to reach at decisions. Minutes that capture the purpose of the meeting and its agreed outcomes are a record that can be referred back to and can be used for follow-up purposes. Effective meeting minutes are clear and to the point, but at the same time, they do not leave out important information.
Any business organisation can maintain minutes to record the proceedings of the meetings in written. Though some of the organizations are mandated by the law to maintain minutes.
Yes. For example, every company incorporated under the provisions of Companies Act, 1956/2013 should maintain minutes of Directors and Members meetings. Every Limited Liability should maintain minutes as per the terms of its Deed. Every Trust and Society should maintain minutes as per their bye-laws.
Apart from compliance with legal requirements, minutes writing serve other purposes as well as listed below:
Although it may seem like writing meeting minutes can take a lot of time, they will, in fact, help you save time and money. Meeting minutes provide a written record of what was discussed and agreed at a meeting, so you and your colleagues will have the same recollections from the meeting and the same ideas about what was agreed. With good meeting minutes, you make sure everyone knows what was decided and what needs to be achieved by what date.
Even though there is no standardized format for meeting minutes, some statutes consider it important that you made a reasonable effort to report the facts of the meeting. For ex- Every listed Company must report the proceedings of the Meetings of its Board of Directors within 15 minutes of its conclusion to SEBI. Minutes generally includes how Board members arrived at reasonable decisions, the date and time of the meeting, who called it to order, and who attended. All motions made at meeting are also recorded including any conflicts of interest, if any, name of the members who abstained from voting, when the meeting ended. That’s how the minutes provide written structure to the meetings.
Good meeting minutes help drive a plan of action for the management and employees. They clarify how, when, why, and by whom decisions were made. They map out a plan for the action items and timelines within which the actions should be taken (which helps get the work done) and they later provide valuable information to those team members who aren’t able to attend the meeting.
Minutes record meeting decisions, which makes them a useful review document when it comes time to measure progress. They also act as an accountability tool because they make it clear who’s duty it was to perform which action.
When votes are recorded and individual names are listed alongside each vote, it serves multiple purposes. It tells the Board and leadership team who voted for what. If one particular Board member abstained on the decision, or voted against the majority, it can be easily recognised. Since every meeting is important, therefore, Meeting minutes should be properly detailed.
Unfortunately, human memory is fallible. Some attendees of the meeting are likely to have selective memories and forget whatever doesn’t substantiate their viewpoint, particularly for controversial issues. Minutes writing is an objective means to remind everyone what was agreed upon and why. It is especially important to have records to refer back to after a significant amount of time has passed and people are no longer sure what transpired. New managers find it helpful to review previous meeting minutes to quickly learn how the organization has been functioning.
Meetings tend to become more efficient when attendees are aware of being recorded; they are more likely to stay on topic. The minutes provide a record of decisions made and who is responsible for taking action. There is an increased chance that these actions will be carried out. Without a record, the attendees might not remember who is responsible for the next step of the action plan and disputes might arise. With a written record to refer to, those responsible will be held accountable and expected to proceed as agreed. Unresolved issues won’t be forgotten and can be revisited at a subsequent meeting.
Meetings are productive. Everyone leaves with a plan in mind, fully aware of the work required in between meetings. The next meeting isn’t for another month, and nobody took any minutes. A month later, the chance might be that the same points and plans are repeated, all because your colleagues failed to remember what transpired at the previous meeting. Just by recording what’s discussed and disseminating that information, silly time-wasting situations like this can be easily avoided.
Minutes are an official record of corporate business. They provide a record of action or evidence of interaction. Copies of the Memorandum of Association, Articles of Association and minutes of recent meetings are the primary documents referred to when there is any legal action. Therefore, it is imperative that board minutes are always considered a priority and recorded professionally.
The absentees of the previous meeting can refer the minutes and get to know what has happened in the meeting which they have failed to attend and this way can stay updated about the proceedings.
Minutes may be referenced in future legal actions. This is one of the main reasons that the minutes must be accurate and thorough. Minutes should provide a clear and concise summary of the meeting and reflect the board’s due diligence in decision making. While the minutes should reflect the major discussions and decisions taken place at the meeting, they should not contain confidential or protected information. Minutes are an internal documentation procedure to help provide information to new directors and provides documentation for management’s follow-up.
(The author of this article is a Practicing Company Secretary located at New Delhi and can be reached at email@example.com)
Disclaimer: The contents of this article are solely for informational purpose. It does not constitute professional advice or a formal recommendation. No part of this article should be distributed or copied without express written permission of the author.