Introduction
The Board of Directors makes important decisions for a public limited company. However, a physical session isn't always convenient, necessary, or possible. This is where circular resolution comes into play — an efficient method of accepting board decisions in writing or electronically.
In this article, you will find out what a circular resolution of the Board of Directors is, when it is appropriate and what legal framework applies in Switzerland. We also show how Konsento automates the process for boards of directors.
Table of contents
- Definition: What is circular resolution?
- Circular resolution use cases
- Legal basis in Switzerland
- Tips for legally compliant implementation
- Automated circular resolutions with consensus
- conclusion
Definition: What is a circular resolution?
A circular resolution (also known as a written resolution) allows the Board of Directors to make decisions without a physical meeting. Instead, members give their consent in writing or electronically. This can be done on paper, email, or via a digital platform.
According to Swiss Code of Obligations, a circular resolution is only valid if no member of the Board of Directors requests an oral discussion. Since the 2023 stock corporation law revision, no signature is required for electronic resolutions, unless the company's articles of association or organizational regulations provide otherwise.
Circular Decision Use Cases
- Urgent decisions that cannot be delayed.
- Standard or routine decisions, such as approval of financial statements.
- Formal decisions, such as the appointment of a signatory, capital increases or subsequent payments, other capital measures or the adoption of agenda items for the general meeting.
- Confidential matters must be decided without major discussion.
- Geographically distributed board members who cannot simply meet in person.
Legal basis in Switzerland
In accordance with the Code of Obligations, the Board of Directors may adopt decisions in writing or electronically, unless a member requests an oral discussion.
Key legal points:
- Electronic resolutions are valid unless otherwise stated.
- Email solutions are allowed if they are clearly marked as solutions and if the suggestions are sufficiently detailed.
- Although electronic resolutions do not require signatures, written (paper) resolutions must be signed for evidentiary purposes.
Tips for legally compliant implementation
In order to ensure legal validity, companies should consider the following points in their sample circular resolution issued by the Board of Management:
- Clear wording: The proposal must clearly be considered a resolution.
- Unequivocal agreement: Responses should be brief and unambiguous.
- No conditions: If amendments are requested, a new proposal should be submitted.
- Rules in the Board Rules: The Executive Board can determine whether written or electronic resolutions are admissible.
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Automated circular decisions with consensus
Konsento's digital corporate action platform is revolutionizing the circular resolution for Swiss stock corporations. It provides an electronic template for circular decisions by boards of directors.
- Guided process: Each step is legally secure and structured.
- Pre-formulated agenda templates: Saves time and ensures regulatory compliance.
- Automatic distribution: All members of the Board of Management are automatically added to the mailing list.
- Clear consent: Digital solutions enable unambiguous approvals.
- Automatic reminders: Board members who have not responded can be reminded at the push of a button.
- Automatic documentation: Every decision is fully recorded
- 100% digital: No paperwork, no manual effort — simple, fast and efficient.
- Legally compliant: Procedure developed in consultation with lawyers and notaries.
Konsento makes circular resolutions a fully automated process that significantly simplifies business administration. It is now available for testing by all premium customers.
Conclusion
A circular resolution is an efficient and flexible way to make board decisions — particularly in urgent, standardized, or formal matters. The legal framework provides for electronic decisions, unless a member requests an oral discussion.
With Konsento's Corporate Action Platform, circular resolutions can be processed digitally, securely and automatically. Take advantage of a fully automated process and save valuable time when managing your business.
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