Drafting Corporate Governance Documents

Note: Want to skip the guide and go straight to the free templates? No problem - scroll to the bottom.
Also note: This is not legal advice.

Introduction

Good corporate governance is essential for businesses to thrive. By making sure that policies and practices are responsibly managed and transparently reported, organisations can ensure that their operations align with the interests of all stakeholders, including shareholders, customers, employees and the wider community.

The Genie AI team knows that having a board of directors who are independent and accountable is fundamental to good corporate governance. The Board is responsible for managing the company’s operations in an impartial way and should be able to update shareholders on their decisions. As part of this role, they should have the authority to appoint executive officers and set their compensation according to performance-based criteria. In addition, the Board should be able to decide upon strategic objectives for the organisation and monitor progress towards these goals.

In tandem with independent directors comes legal documentation – such as codes of conduct or anti-corruption policies – which guarantees that companies operate in accordance with regulations while protecting everyone’s interests equally. The Genie AI community template library provides free documents of this kind in order to facilitate responsible management within any organisation whilst keeping costs at bay. Furthermore, our step-by-step guidance enables readers to access these templates quickly without needing a Genie AI account - we just want to help!

To summarise - when it comes down it good corporate governance matters because it ensures companies operate ethically while minimising potential risks such as fraud or corruption which can damage public trust. For more detailed advice on how you can achieve this today read on below for more information from the Genie AI team…

Definitions (feel free to skip)

Stakeholders: People or organizations that have a vested interest in the success of a company.
Bylaws: Rules and regulations that outline the operations and management of a company.
Corporate Charter: A legal document that establishes a company and defines its purpose and powers.
Code of Conduct: A set of rules outlining the ethical and legal standards of behavior expected of a company’s personnel.
Sarbanes-Oxley Act: A law in the United States that sets standards for all publicly traded companies.
Executive Officers: People who are responsible for managing a company and making decisions on behalf of the board of directors.
Minority Shareholders: Shareholders who own a smaller percentage of a company’s shares than the majority shareholders.

Contents

Get started

Overview of Corporate Governance

Once you have completed this step, you will have a solid understanding of the purpose of corporate governance, its goals, and the documents required to effectively implement it.

Understanding the purpose and value of corporate governance

Familiarizing yourself with corporate governance laws and regulations

Understanding the Different Types of Corporate Governance Documents

When you can check this off your list and move to the next step:

Becoming familiar with the different types of corporate governance documents and their purpose

Examining examples of corporate governance documents

Assessing Your Needs for Corporate Governance Documents

Analyzing your organization’s current corporate governance structure

When you have gathered and analyzed the necessary information on the company’s corporate governance structure, you can move on to the next step (### Determining which corporate governance documents are necessary for your organization).

Determining which corporate governance documents are necessary for your organization

Drafting Your Corporate Governance Documents

Planning the structure of your corporate governance documents

Writing the content of your corporate governance documents

When you have completed the writing process, ensure that the corporate governance documents are properly formatted and all the necessary information is included. You should then be ready to have the documents reviewed and approved by a legal counsel.

Acquiring legal counsel for review and approval

You’ll know when you can check this step off your list when the lawyer or law firm has reviewed, approved and signed off on the documents.

Implementing and Maintaining Your Corporate Governance Documents

Once these steps have been completed, you can check this off your list and move on to the next step of establishing procedures for the implementation and maintenance of your corporate governance documents.

Establishing procedures for the implementation and maintenance of your corporate governance documents

Once you have established these procedures for the implementation and maintenance of your corporate governance documents, you can check this step off your list and move on to the next step.

Training the organization’s employees on the corporate governance procedures

How you’ll know when you can check this off your list and move on to the next step:
Once the personnel have been trained on the corporate governance procedures and have successfully complied with them for an acceptable period of time, you can move on to the next step of monitoring and adapting to changes in corporate governance.

Monitoring and Adapting to Changes in Corporate Governance

Once you have completed the steps above, you will have successfully established a system for monitoring and adapting to changes in corporate governance.

Staying up to date on changes in corporate governance laws and regulations

Evaluating your corporate governance documents to ensure they remain compliant

Other Considerations for Corporate Governance Documents

Once you have considered all of the above points, you should have a complete set of corporate governance documents. You can then move on to the next step of designating a corporate governance officer.

Designating a corporate governance officer

Once all these steps are completed, you can check off the step and move on to the next step: Establishing a corporate governance committee.

Establishing a corporate governance committee

Maintaining corporate governance records

Scheduling periodic corporate governance reviews

FAQ:

Q: Is there a difference between Corporate Governance documents in the UK and USA?

Asked by Abigail on 3rd April 2022.
A: Yes, there is a difference between Corporate Governance documents in the UK and USA. Generally, the UK approach to Corporate Governance is more hands-off than the US model, which is more prescriptive. In the US, Corporate Governance documents are more detailed and precise in their guidance on a corporation’s operations. For example, in the UK, there may be a board of directors with roles and responsibilities specified in a document such as a memorandum of understanding. In the US, a board of directors typically has more defined roles and responsibilities, such as establishing policies and procedures that must be followed by all members of the organization. Additionally, Corporate Governance documents in the US often include specific rules or regulations that must be followed in order to maintain compliance with state or federal laws.

Q: Do Corporate Governance documents need to be updated regularly?

Asked by Scott on 4th June 2022.
A: Yes, Corporate Governance documents should be updated regularly in order to stay up-to-date with changes in the law and industry standards. As new regulations are passed or existing regulations are amended, it is important for corporations to stay abreast of these changes in order to remain compliant. Additionally, as new technologies emerge or industry standards change, it is important for corporations to update their documents accordingly in order to remain competitive. It is also important for companies to review their documents periodically to ensure that all policies and procedures outlined within them are still relevant and up-to-date.

Q: What specific topics should I cover when drafting Corporate Governance documents?

Asked by Tyler on 30th September 2022.
A: When drafting Corporate Governance documents it is important to cover a variety of topics including roles and responsibilities of directors, management structure, shareholder rights and privileges, board composition and size requirements, voting and decision-making processes, financial controls, conflict of interest policies and procedures and any applicable laws or regulations pertaining to the corporation’s specific industry or sector. Additionally, it is important for organizations to consider their specific needs when drafting these documents as certain topics may need to be addressed more specifically based on an organization’s particular situation.

Q: Is there any overlap between EU and UK Corporate Governance documents?

Asked by Emma on 2nd November 2022.
A: Yes, there is some overlap between EU and UK Corporate Governance documents as they both adhere to similar principles of corporate governance. The EU generally follows a ““comply or explain”” approach which requires companies to either comply with certain recommendations surrounding corporate governance or provide an explanation as to why they have not done so. This approach is similar to that taken by many UK companies as well who often provide an explanation where they are not able to comply with certain recommendations outlined in corporate governance codes or regulations. Additionally, both countries often have similar provisions regarding shareholder rights, board composition and size requirements as well as decision-making processes which further highlights the similarities between them when it comes to corporate governance documents.

Q: Can I draft my own Corporate Governance documents without help from professionals?

Asked by Benjamin on 4th December 2022.
A: It is possible for individuals who have expertise in law and corporate governance principles to draft their own Corporate Governance documents without help from professionals. However, it is important to note that there may be legal implications if these documents are not drafted properly so it is always recommended that individuals seek professional advice when creating these documents for their organization. Additionally, drafting your own Corporate Governance documents can be time consuming as they must address a variety of topics such as roles and responsibilities of directors, management structure, shareholder rights and privileges, board composition and size requirements etc., so it may be beneficial for individuals who lack expertise in this area to seek assistance from professionals who can provide guidance throughout the process.

Example dispute

Suing a Company for Breach of Corporate Governance

Templates available (free to use)

Helpful? Want to know more? Message me on Linkedin