Every corporation shall prepare and maintain, at its registered office or at such other place in Ontario designated by the directors all official record of its proceedings and decisions (section 140 of Business Corporations Act, R.S.O. 1990, c. B.16).
A minute book is important because it serves as an official record of the proceedings and decisions of a company or organization. It contains minutes of meetings, including the date, time, place, attendees, and actions taken. This information is used to ensure that the organization is being run in accordance with its bylaws and laws and can be used as evidence in legal proceedings if necessary. Additionally, the minute book can also be used to track the progress of the company and to make sure that important decisions are not forgotten or overlooked. A lack of a minute book can be an indication of poor record-keeping and a lack of attention to compliance with laws and bylaws.
Proper records and minutes of meetings are important for several reasons:
Compliance: Maintaining proper records and minutes of meetings can help ensure that an organization is operating in compliance with its bylaws and laws. This can be especially important for corporations that have legal requirements to keep certain types of records.
Transparency: Minutes of meetings provide a clear and accurate record of what was discussed and decided during a meeting. This can help ensure that everyone involved is on the same page and that important information is not forgotten or overlooked.
Accountability: Having a record of what was discussed and decided during a meeting can help hold individuals accountable for their actions. It can also provide evidence of decisions that have been made if there is any dispute later.
Decision Making: Minutes of meetings can be used to track the progress of the company and to make sure that important decisions are not forgotten or overlooked.
Legal Evidence: The minutes of meetings can be used as evidence in legal proceedings if necessary. It can be used to prove that a meeting took place, the attendees, the decisions made, and the actions taken.
In summary, having proper records and minutes of meetings are essential for the effective governance and operations of any organization, it ensures compliance, transparency, accountability, decision making, and it can serve as legal evidence if required.
The importance of proper records and minutes of meetings is relevant for both small businesses and large organizations. While small businesses may not have the same legal requirements for record-keeping as larger corporations, maintaining proper records and minutes can still be beneficial for the effective governance and operations of the business.
Small businesses may not have the same level of complexity as larger organizations, but they still face the same challenges of compliance, transparency, accountability, decision making and protecting their assets. Proper records and minutes can help ensure that the business is operating in compliance with laws and regulations and that important information is not forgotten or overlooked. Additionally, it can serve as legal evidence in case of disputes or legal proceedings.
Regardless of the size of the business, maintaining proper records and minutes is a best practice that can help ensure the effective governance and operations of the business.
We can help in incorporation with the minute-book.
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This material is for informational purposes only and should not be relied upon as legal advice. To book a consultation with Buzaker Law Firm regarding reviewing your commercial lease agreement or other real estate-related or corporate documents, contact us at info@vblegal.ca or (905) 370-0484.