Alex is Sprintlaw’s co-founder and principal lawyer. Alex previously worked at a top-tier firm as a lawyer specialising in technology and media contracts, and founded a digital agency which he sold in 2015.
If you’re running a UK limited company, you’ll eventually hit a moment where a quick chat between directors isn’t enough.
Maybe you’re opening a new bank account, signing a major contract, appointing a new director, or approving a loan. The decision is important, and you need a clear record that the board properly approved it.
That’s where board resolutions come in.
In this guide, we’ll explain what a board resolution is, when you should use one, what it should include, and how to keep your company compliant (without drowning in legal jargon).
What Is A Board Resolution?
So, what is a board resolution in practical terms?
A board resolution is a formal written record of a decision made by a company’s board of directors. It shows:
- What decision was approved
- Who approved it (the directors)
- When it was approved
- How it was approved (at a meeting or by written decision)
Think of it as the company’s paper trail for director-level decisions. It can be essential for demonstrating good governance, satisfying banks and investors, and protecting you if the company’s decisions are later challenged.
Board Resolutions vs Shareholder Resolutions: What’s The Difference?
This is a common point of confusion for small business owners.
In simple terms:
- Board resolutions are decisions made by directors (the people managing the company day-to-day).
- Shareholder resolutions are decisions made by members/shareholders (the owners).
Some decisions can be made by the directors alone. Others must be approved by shareholders (or approved by directors and shareholders). A lot depends on your company’s Company Constitution and what the Companies Act 2006 requires for that specific action.
Is “Board Of Resolution” The Same Thing?
You might see people search for “board of resolution” or “what is board resolution”. In most cases, they’re referring to the same idea: a formal decision of the board recorded as a resolution.
The standard term in the UK is board resolution (or “director resolution”).
When Do You Need A Board Resolution In The UK?
Not every decision needs a formal resolution. But as a director, it’s smart to document decisions that are significant, sensitive, or likely to be relied on by third parties.
Common situations where you’ll want board resolutions include:
- Appointing a director (and authorising Companies House filings)
- Removing a director (often a shareholder decision by ordinary resolution, with board steps and filings to follow)
- Opening or changing bank accounts and signing banking mandates
- Approving a major contract (especially one outside “business as usual”)
- Borrowing money, granting security, or approving a company loan
- Approving related party transactions (e.g. contracts with a director or a director’s connected company)
- Issuing shares (where directors have authority to allot shares)
- Declaring dividends (subject to the Companies Act 2006, available profits, and your Articles - and sometimes shareholder approval, depending on the type of dividend)
- Approving company policies (especially if they affect legal compliance)
As your company grows, these records become even more valuable. For example, when you’re taking on investment, a buyer may ask for evidence that key decisions were properly approved and recorded.
Do Small Companies Really Need To Bother?
Yes - and it’s often more important for small companies.
In a founder-led business, it’s easy for decisions to happen quickly and informally. But when something goes wrong (a dispute between co-founders, a regulatory issue, or a contract challenge), missing documentation can turn a straightforward situation into a messy one.
Board resolutions are part of keeping your legal foundations strong from day one.
How Are Board Resolutions Passed? (Board Meeting vs Written Resolution)
In the UK, directors generally make decisions in two main ways:
- at a board meeting; or
- by a written directors’ resolution (sometimes called a “written resolution of the directors”).
Exactly what’s allowed (and what notice is required) will depend on your Articles of Association and any director decision-making rules you’ve adopted.
Option 1: Board Meeting
A board meeting is the classic approach: directors meet (in person, by phone, or by video) and vote on decisions.
If you pass decisions at a meeting, you should also keep good records of what happened - typically in board minutes. This is a separate document to the resolution itself, but they’re often used together.
For an easy way to keep your governance tidy, it helps to have a consistent approach to board meeting minutes.
Option 2: Written Board Resolution (Directors’ Written Resolution)
A written board resolution is usually a faster option for small businesses. Instead of holding a meeting, directors sign a document confirming they approve the decision.
This can be particularly useful when:
- the decision is straightforward;
- the directors are in different locations;
- you need to move quickly (for example, to meet a deadline); or
- the company is run by a small number of directors and everyone agrees.
Just keep in mind that written director resolutions are different from shareholder written resolutions, and the signing requirements can differ depending on your company rules.
Do Board Resolutions Need To Be Filed With Companies House?
Usually, no. Board resolutions are typically kept as internal company records.
However, the decision you make may require a Companies House filing (for example, appointing a director, issuing shares, or changing registered details). The resolution supports the filing and shows the company properly approved it.
In certain situations, a resolution (or details of it) may need to be provided to banks, investors, accountants, auditors, or other third parties.
What Should A Board Resolution Include? (A Practical Checklist)
A good board resolution should be clear, specific, and easy for an outsider to understand.
While there’s no one-size-fits-all format, most board resolutions in the UK include the following:
- Company name and (ideally) company number
- Date of the resolution
- Details of the decision (the “resolution wording”)
- Authority for the decision (for example, “pursuant to the Articles of Association”)
- Names of directors approving the decision
- Signatures of the directors (if it’s a written resolution)
Make The Decision Wording Specific
Vague wording is one of the easiest ways to create future problems.
Compare:
- Too vague: “The directors approve entering into a contract.”
- Better: “The directors approve the company entering into the Supply Agreement with dated , on the terms presented to the directors, and authorise to sign the agreement on behalf of the company.”
That extra detail can matter a lot if the contract is later disputed, or if someone questions whether the director had authority to sign.
Do Board Resolutions Need Witnesses?
Typically, a standard board resolution does not need a witness.
But you may need witnessing if the resolution is connected to documents executed as deeds, or where your Articles or a third party (like a lender) requires witnessing.
If you’re unsure, it’s worth confirming who can witness a signature in a UK business context, because not everyone qualifies in every scenario.
What If The Company Needs To Execute A Deed?
Some transactions are executed as a deed (for example, certain property documents, guarantees, or deed-based variations). This can affect signing formalities.
If the board resolution is approving a deed (or authorising someone to sign it), you should make sure the execution method is correct. A useful reference point is how to handle executing contracts and deeds properly.
Common Mistakes With Board Resolutions (And How To Avoid Them)
Board resolutions are meant to protect your company - but only if they’re done properly.
Here are some common traps we see small businesses fall into.
1. Approving Something The Directors Don’t Actually Have Power To Do
Directors have wide powers to manage the company, but they’re not unlimited. Some actions need shareholder approval, and some are restricted by the Articles.
For example, certain share issues, large asset sales, or conflicts transactions might require extra steps. If you have a Shareholders Agreement, it may also require specific approvals (like unanimous director consent, investor consent, or reserved matters).
2. Not Recording Conflicts Of Interest
If a director has a personal interest in a decision (for example, the company is contracting with the director’s other business), you need to handle it carefully.
Depending on the Articles and the Companies Act 2006, the director may need to declare the nature and extent of their interest, and they may be restricted from voting.
Even if the deal is completely fair, failing to document the conflict properly can create legal risk later.
3. “Backdating” Decisions After The Event
It’s tempting to create a resolution only after a bank asks for it or after you’ve already signed a contract.
While you can sometimes ratify decisions, you should avoid making it look like a decision was properly approved when it wasn’t. If you need to correct the record, get legal advice on the cleanest way to do it.
4. Forgetting To Keep The Resolution With Company Records
Board resolutions aren’t helpful if they go missing.
As a basic governance habit, keep a dedicated folder (digital or physical) for:
- board resolutions
- board minutes
- shareholder resolutions
- key company registers and filings
This kind of recordkeeping makes life much easier during due diligence, funding rounds, audits, and even internal handovers.
5. Using A Generic Template That Doesn’t Match The Transaction
For simple approvals, a template can be a great starting point. But the wording needs to match what you’re actually doing.
If a resolution is authorising someone to sign multiple documents, approve a loan with specific terms, or execute a deed, you’ll want to make sure the wording is tailored and legally workable.
That’s where having something structured (and reviewed) like a Directors Resolution template can save you time and reduce risk.
Key Takeaways
- What is a board resolution? It’s a formal record of a decision made by the company’s directors, showing what was approved, when, and by whom.
- Board resolutions help protect your business by creating a clear paper trail for major decisions and authority to act.
- You’ll commonly need board resolutions for bank mandates, major contracts, director appointments, borrowing, issuing shares, and other key governance decisions.
- Board decisions can be made at a meeting (recorded in minutes) or via a written directors’ resolution, depending on your Articles and decision-making rules.
- Good resolutions are specific and clearly authorise actions (like signing a named agreement), rather than using vague wording.
- Execution rules matter if the resolution relates to deeds or documents requiring witnesses, so it’s worth checking the signing formalities before you commit.
This article is for general information only and isn’t legal advice. If you’d like help preparing board resolutions, reviewing your Articles, or making sure your company’s decisions are properly documented, you can reach us at 08081347754 or team@sprintlaw.co.uk for a free, no-obligations chat.
