Guide on Appointing a Corporate Secretary in the Philippines

A corporate secretary is essential for ensuring compliance and smooth business operations. In the Philippines, this role is required when setting up a corporation. With the right corporate secretary, your company benefits from expert document management and adherence to local laws, setting a strong foundation for success.

• What is a Corporate Secretary?
• What are the Requirements for Appointing a Corporate Secretary?
• What are the Responsibilities of a Corporate Secretary?
• What Makes a Corporate Secretary Effective??
• Frequently Asked Questions

Corporate Secretary

A Corporate Secretary plays a unique role in governance, separate from the Board of Directors and management. They ensure regulatory and statutory compliance.

In the Philippines, this critical position is reserved for Filipino citizens who are also residents. While recent amendments allow non-Filipinos to be incorporators, the requirement for a Corporate Secretary to be both a citizen and resident remains, reflecting the role’s importance in upholding governance and compliance.

Requirements for Appointing a Corporate Secretary

Corporate Secretaries are vital to corporations in the Philippines. Here are the requirements for their appointment.

• Filipino Citizen. The Corporate Secretary must be a Filipino citizen, ensuring expertise in local regulations.
• Philippine Residency. The individual must also be a resident of the Philippines to fulfill statutory requirements.
• Legal Expertise. Though not mandatory, a legal background or expertise in corporate governance is highly beneficial.
• Outlined in By-laws. Specific duties and responsibilities of the Corporate Secretary are typically outlined in the company’s by-laws.
• Amendment Exemption. Although non-Filipinos can now be incorporators, the Corporate Secretary must still fulfill strict citizenship and residency requirements.

Responsibilities of a Corporate Secretary

The role of a Corporate Secretary in the Philippines is essential, serving as the backbone of a corporation’s compliance and governance framework. Below are the responsibilities of a corporate secretary:

1. Scheduling and Documenting Board Meetings

The Corporate Secretary’s key responsibilities include scheduling board meetings, ensuring compliance with notice requirements, and recording accurate minutes to uphold meeting integrity and validity. They also document changes in share capital and the election or resignation of directors.

Additionally, they arrange the annual schedule of board meetings, notify the Board of upcoming sessions, and, when needed, coordinate logistics such as venue, lodging, transportation, and catering.

2. Record Keeping

Corporate Secretaries manage and safeguard the corporation’s records and books, ensuring the organization and security of essential documents, including but not limited to the following:

• Registration certificates
• Annual General Information Sheet (GIS)
• Board resolutions
• Stock and transfer books
• Records of the stocks issued
• Minutes of all board meetings (whether routine or non-routine)

3. Other Responsibilities

Corporate Secretaries oversee the proper conduct of a corporation’s Election of Directors. They are responsible for ensuring the proper conduct of the election by performing or supervising the exercise of the following:

• Determination of the number of shares of stocks;
• Existence of a quorum;
• Validity and effect of proxies;
• Addressing of issues and questions regarding the right to vote;
• Counting and tabulation of all votes, ballots, or consents; and
• Announcement of election results.

Meeting minutes must clearly reflect board decisions and be properly distributed and implemented. Corporate Secretaries are responsible for communicating Board resolutions to relevant parties, often providing certified proof when necessary. If designated by the President, they may also act as advisors to the Board, offering guidance on responsibilities and corporate governance.

Core Competencies of An Effective Corporate Secretary

When appointing a Corporate Secretary, corporations should prioritize the following key attributes:

• Exemplary organizational skills
• In-depth knowledge of corporate and securities law
• Thorough knowledge of company by-laws, business activities, and compliance requirements
• Ability to overcome, or not be bothered by, bureaucratic thinking in the company
• Ability to read signals and provide early warnings to the Board and management
• A calm and rational mediator
• An effective and patient communicator
• A strong sense of balance no matter how pressed a situation is