30+ SAMPLE Board Resolution Letters in PDF | MS Word

What Is a Resolution Letter?

Think of a company, partnership proposal, association, or institution like a school. All are composed of members and governed by a set of officers or directors, each having a share in making decisions for the good of the organization. Several times in a year, they need to meet and gather to make those major decisions—also known as a corporate or board meeting. In that meeting and all other business meetings, there are formal papers that document what has been discussed and resolved by the members. One of which is a resolution letter.

A resolution letter contains the action the company or organization is going to take to address an existing corporate issue. It is then sent to all members, shareholders, or officers of the corporation, partnership, organization, or institution regardless of whether they were present or absent during a meeting to inform them of the fact that a resolution has been made. It serves two purposes. First, to inform or notify members of the decision made during the board meeting. Second, as compliance with company procedure; all members must be kept up to date with corporate happenings.

Instances a Board Resolution is Required

A company or organization is made up of directors or officers and members or shareholders. The stakeholder plan is the governing body that is usually in charge of making and concluding major decisions for the company or organization. Formal resolutions are often required for actions that can have major financial effects as well as for major internal changes. The officers usually come up with a decision or resolution during the board meeting. Below are a few of the many instances a company or organization may call a board meeting and issue a board resolution.

1. Opening a Corporate Bank Account

   A corporation is an entity separate and distinct from that of its officers and members. Meaning, it has its own personality. It is capable of owning, selling, buying, and entering into contracts under its name. It is even capable of owning a personal corporate bank account. However, before it can open said bank account, it needs majority approval of all its members or shareholders which should be contained in a board resolution. The banks will require a copy of the resolution, and the corporation will have to send the bank a corporate resolution letter containing the majority approval of all members for the opening of the bank account. In addition, the document must contain information such as who can sign checks, borrow or loan money, or who can make general banking decisions.

2. Entering into a Business Contract

   Signing a contract for a company, corporation, or organization can have financial implications. Hence why, before a company can enter into a business contract it needs to have the approval of its board members. For a contract entered by a corporation to be legally binding, it must be signed by all of the corporation’s directors and officers. During the board meeting, all directors and officers must signify their vote whether they approve or disapprove of the transaction. Usually, a majority vote is required but the corporation’s article of incorporation may provide additional guidelines or an entirely different and unique voting requirement.

3. Appointment of Corporate Officers

   Corporate officers are the directors, secretary, and treasurer of the corporation. Their appointment is made during a scheduled board meeting called for the purpose of electing or appointing corporate officers. The process starts once officers are elected by existing shareholders or members during the shareholder’s meeting or general assembly. The elected officers will then have to schedule a board or officer’s meeting where they will have to decide who gets to be the director, secretary, and treasurer of the corporation. Once they have decided, the resolution is then sent to all existing members or shareholders as contained in a resolution letter.

4. Executing Corporate Loans

   Borrowing money and entering into a loan agreement with any financial institution on behalf of the corporation, company, or institution can have major financial implications. It can increase the debt of the company or organization, making it harder to manage and take back. This is why the president of the company or organization cannot just execute and apply for corporate loans without the approval of the board members. The board members will have to conduct a board meeting and decide on the matter, their decision will then be reflected in a board resolution which shall be kept in record.

How To Write a Resolution Letter?

Conducting board meetings and shareholder meetings is an essential part of running a corporation, organization, and institution. In a year, there are at an average 1, 289 number of corporate or business meetings that take place. Imagine all the resolutions and major business decisions made during those board meetings. At every end of the meeting, the corporation is required to send the decided resolution to all its members. The corporation’s decision and what happened during the meeting are documented and contained in a resolution letter. The letter informs each of the corporations member the progress and actions the company is taking to address an issue or dilemma. Below are some steps in writing a resolution letter.

Step 1: Place a Resolution Number

Start by indicating the date the resolution was made and a resolution number at the top of the page. A resolution number is written on the face of the letter to make it easier to organize and keep track of all resolutions made during the lifetime of the company, organization, or institution. Consider giving each resolution consecutive numbers, starting from the first resolution with the number 000001, next with 000002, and so on. Write it in ascending format and make sure to keep a copy for corporate. Store it in company premises, alongside other resolutions. Keep all copies in a single folder.

Step 2: Write a Title for the Resolution

The title of the resolution should be the same as the issue resolved during the board meeting. Always include the title of the resolution in the resolution letter so the reader can get the grasp of the context of the letter. He should be able to know what the letter is about just by reading the title provided on the face of the letter. The title should be clear and easily understood. For example, “Resolution to Enter into a Lease Agreement with ABC Corporation for the Establishment of Company Headquarters.”

Step 3: Use Formal Language

The letter should be written in a formal language since it is a formal business document after all. The resolution decided during the board meeting should be separated by paragraphs and should start with the word “whereas”. For every paragraph, a decision should be clearly stated. The letter should state that the resolution is made by the board officers during the board meeting held in the place where the meeting took place and the time. For example, “…as decided in the board meeting held on 29th May 2019 at the Century Plaza Hotel.”

Step 4: Clearly Indicate the Voted Resolution

The last “whereas” paragraph should contain the final resolution decided during the board meeting. Basically, it summarizes what was decided and how the board has decided to resolve the issue. You can either directly state the decision or provide the breakdown of the decision—who voted yes, and who voted against it. For example, “whereas, it has been resolved and decided that the funds of the 2019 Team Building shall be designated to the organization’s 2020 Charity Fundraiser Project”

Step 5: Include a List of Voting Board Members

To encourage transparency in the voting held during the board meeting, most board resolutions and resolution letter should contain the breakdown of votes made by its corporate officers. The letter should contain a list of all the officers present during the board meeting and who participated in the voting process. It should also contain the action made by each officer, whether they voted in favor, against, or abstained from voting. Their vote should be indicated adjacent to their printed names.

Step 6: Have the President Sign the Resolution

Lastly, the president of the corporation, organization, or institution should sign the resolution letter to indicate the authenticity of the document. It possible and applicable the letter should be sealed using the corporate seal. In addition, make sure there is a date when the president signed the resolution letter. The signature must be made on top of the president’s printed name.

FAQs

It is important to know the process of solving an issue and adopting a resolution. If you are in the process of writing a resolution letter, understanding what the letter is should take your worries out. Sure it’s an important corporate document, but that should not intimidate you. It’s actually pretty simple and easy to write. If you are having trouble with the formatting, you can check out some of our sample templates above. Try and find a template similar to your purpose. Find one that is flexible enough and can serve the purpose of the resolution you need to write. Most importantly, it’s not just about the formatting, you need to make sure that you have the letter signed before mailing it to the respective recipients.