A company secretary acts as the silent guardian, ensuring legal compliance, effective governance, and strategic decision-making in a business.
While business founders are often occupied with bringing their visionary ideas to life, one role in starting a business is overlooked: that of the company secretary.
The role of a company secretary isn’t just about keeping records; a company secretary is vital for ensuring your business complies with all legal requirements.
Imagine having someone who keeps you out of hot water while you focus on growth—that’s the power they bring to the table.
But wait, how do they manage it all? Let’s break down everything about the role of company secretary in a startup, and why every successful startup needs one.
What is a company secretary?
A company secretary is a key officer in a company who ensures legal and regulatory compliance, maintains corporate records, and facilitates effective communication between the board of directors, shareholders, and other stakeholders.
But here’s the thing: in Singapore, appointing a corporate secretarial position isn’t just a nice-to-have add-on. According to the Accounting and Corporate Regulatory Authority (ACRA), every company must appoint a company secretary within 6 months of incorporation. And not just anyone can fill this role. The company secretary must be a natural person who is a resident of Singapore.
The difference between a company secretary and a corporate secretary
While the terms are often used interchangeably, there is a slight distinction. A corporate secretary usually refers to the secretary of a corporation, while a company secretary can be appointed for any type of company, including startups and small businesses.
Regardless of the terminology, the role and responsibilities remain largely the same. The company secretary acts as the point of contact between the company and its stakeholders, ensuring that all legal and regulatory requirements are met.
What is the role of a company secretary in a startup?
So what exactly does a company secretary do in a startup?As it turns out, quite a lot.
1. Administrative or operational duties
A company secretary in a startup is responsible for various administrative tasks, such as maintaining statutory registers, preparing and filing annual returns, and ensuring that the company complies with its constitution and bylaws.
2. Financial responsibilities
The company secretary in a startup often assists with financial matters, such as maintaining financial records, preparing financial statements, and ensuring that the company complies with relevant financial reporting requirements.
3. Compliance with company law and regulations
One of the primary roles of a company secretary in a startup is to ensure that the company complies with all applicable laws and regulations. This involves staying up-to-date with changes in legislation and advising the board of directors on legal matters.
4. Facilitating board meetings and general meetings
The company secretary in a startup is responsible for organising and facilitating board meetings and general meetings. This includes preparing agendas, sending out notices, taking minutes, and ensuring that meetings are conducted together with business owners in accordance with legal requirements.
5. Maintaining statutory registers and records
A company secretary must maintain various statutory registers and records, such as the register of members, register of directors, and register of charges. These records must be kept up-to-date and made available for inspection when required.
Benefits of hiring a company secretary for your startup
Now, you might be thinking—hiring a company secretary sounds like an added expense for your startup. But trust us, the benefits far outweigh the costs.
Compliance with legal requirements
Hiring a company secretary for your startup helps ensure that your business remains compliant with all relevant legal requirements. This can help avoid costly penalties and legal issues down the line.
Save time and resource for founders
By outsourcing company secretarial duties to a professional, startup founders can save valuable time and resources that can be better spent on growing and developing their business.
Expert advice on corporate governance
A skilled company secretary can provide expert advice on corporate governance matters, helping startups establish a strong foundation for long-term success.
Minimise the risk of penalties and fines
By ensuring compliance with legal requirements and maintaining accurate records, a company secretary can help minimise the risk of a startup incurring penalties and fines from regulatory authorities.
How to choose the right company secretary for your startup
Choosing the right company secretary is crucial. Read on to get some guidance on how to make that important selection, and get it right first time.
Factors to consider when choosing a company secretary
When choosing a company secretary, consider factors such as:
- Qualifications
- Experience
- Reputation
- Familiarity with your industry
It’s also important to ensure that they are a good fit with your company culture.
In-house vs. outsourced company secretary services
Startups have the option of hiring an in-house company secretary or outsourcing corporate secretarial services to a professional firm. Outsourcing can be a cost-effective solution for startups with limited resources, while an in-house secretary may be preferable for larger startups with more complex needs.
Feature | In-House Company Secretary | Outsourced Company Secretary Services |
Focus | Dedicated to the company | May be working with multiple clients |
Cost | Higher cost (salary, benefits, training, office space) | More cost-effective |
Expertise | Limited to the individual’s knowledge and experience | Access to a team of experts with diverse knowledge and experience |
Confidentiality | Sensitive information kept within the company | Confidentiality protocols in place, but some risk of sharing |
Company knowledge | Deep understanding of company operations and culture | May take time to fully understand company nuances |
Administrative burden | Company responsible for workload and professional development | Outsourcing firm handles workload and development |
Choosing the best option for your company depends on various factors, including company size, budget, compliance requirements, and preferences for control and confidentiality.
Qualifications and experience of a company secretary
In Singapore (SG), the qualifications and experience required for a company secretary depend on whether the company is public or private.
Public companies
A company secretary for a public company must meet at least ONE of the following criteria:
Experience: A minimum of three years of relevant secretarial experience in the past five years before appointment.
Professional Qualification:
- A qualified person under the Legal Profession Act (Cap. 161).
- A public accountant registered under the Accountants Act (Cap. 2).
- A member of the Institute of Singapore Chartered Accountants (ISCA).
- A member of the Singapore Association of the Institute of Chartered Secretaries and Administrators (SAICSA).
- A member of the Association of International Accountants (AIA).
- A member of the Institute of Company Accountants, Singapore (ICAS).
Private companies
There are no specific statutory qualifications for company secretaries of private companies in Singapore. However, the Accounting and Corporate Regulatory Authority (ACRA) recommends that company secretaries possess:
Knowledge:
- A good understanding of the Companies Act and other relevant laws and regulations.
- Familiarity with corporate governance practices and procedures.
- Knowledge of accounting and financial reporting principles.
Skills:
- Excellent communication and interpersonal skills.
- Strong organizational and time management skills.
- Attention to detail.
- Ability to work independently and as part of a team.
Additional Considerations
Beyond the basic requirements, it is often beneficial for a company secretary to have:
- Industry-specific knowledge: If the company operates in a specific industry (e.g., finance, technology), knowledge of the industry’s regulatory landscape can be an asset.
- Experience with ACRA’s online filing system: Familiarity with BizFile+, ACRA’s online filing system, is essential for efficient compliance management.
- Continuing Professional Development (CPD): It is advisable for company secretaries to engage in continuous learning to keep their knowledge and skills up-to-date.
It is important to note that these are general guidelines. The specific qualifications and experience required for a company secretary may vary depending on the size and complexity of the company and its operations.
Common mistakes to avoid when appointing a Singapore company secretary
While appointing a company secretary is a critical step for startups, there are some common mistakes to avoid:
Appointing an unqualified or inexperienced company secretary
One common mistake startups make is appointing a company secretary who lacks the necessary qualifications or experience. This can lead to errors, non-compliance, and potential legal issues.
Failing to provide necessary information and documents
Startups must provide their company secretary with all the necessary information and documents to carry out their duties effectively. Failing to do so can result in delays, inaccuracies, and non-compliance.
Not communicating regularly with the company secretary
Regular communication between the startup’s management and the company secretary is essential for ensuring smooth operations and compliance. Neglecting to keep the company secretary informed of important decision and business resolution and business changes can lead to problems down the line.
Key Takeaway:
A company secretary ensures your startup stays compliant with laws and regulations, handles administrative tasks, and provides expert advice on corporate governance. They save founders time by managing these administrative and financial duties so they can focus on growth.
Conclusion
Understanding the role of a company secretary is crucial for any start-up or small business. They are the guardians of compliance, ensuring that your business adheres to all legal requirements. They also serve as a valuable resource, freeing up your time to focus on what truly matters—growing your business.
Choosing the right company secretary, whether in-house or outsourced, is a decision that should not be taken lightly.
But with a competent company secretary by your side, you can rest assured that your startup is well-equipped to navigate the complexities of corporate governance and legal compliance.
Ready to change your corporate secretary services? Sleek is here to redefine what corporate secretary services mean for your startup.
FAQs about the role of secretary in a Singapore company startup
Is it mandatory for a startup in Singapore to have a company secretary?
Yes, under the Singapore Companies Act, every company, including startups, must appoint a company secretary within six months of incorporation.
What are the qualifications required for a company secretary in a startup?
There are no specific statutory qualifications for company secretaries in private companies (which most startups are). However, it’s recommended they have a good understanding of the Companies Act, corporate governance, and accounting principles.
Can a company secretary be one of the startup's founders or company directors?
Yes, but it’s generally advisable to have an independent company secretary to ensure objectivity and avoid conflicts of interest.
Can a startup outsource its company secretary services?
Absolutely! Many startups outsource this function to professional firms specializing in company secretarial services. This can be a cost-effective option, especially for early-stage startups.
How much does it typically cost to hire a company secretary in Singapore?
The cost of hiring a company secretary varies depending on the experience and qualifications of the secretary. For outsourced services, the fees depend on the scope of services required and the reputation of the firm. It’s advisable to obtain quotes from multiple providers to compare costs.
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