Who is a Company Secretary?
A Company Secretary is
Understanding the Role of a Company Secretary
Before delving into the appointment or removal process, it's essential to understand the responsibilities of a company secretary. These typically include:
- Ensuring compliance with statutory and regulatory requirements.
- Maintaining company records and registers.
- Organizing board meetings and general meetings.
- Advising the board on corporate governance matters.
- Facilitating communication between the company and its stakeholders.
Appointment of a Company Secretary
According to CAMA, every company in Nigeria must appoint a company secretary within a specific period after incorporation. The appointment can be made by the board of directors.
- The person appointed as the company secretary should possess the necessary qualifications and expertise to fulfill the responsibilities of the role.
- The appointment must be recorded in the minutes of the board meeting, along with any relevant details such as the individual's name, qualifications, and effective date of appointment.
- It's advisable to draft a formal appointment letter outlining the terms and conditions of the appointment, including remuneration, duties, and responsibilities.
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Removal of a Company Secretary
Just as the Companies and Allied Matters Act, 2020 (CAMA) makes a mandatory requirement for all companies to appoint a Secretary, it also makes provisions for the removal of a company Secretary. As such, the removal of a company secretary can occur through various means, such as resignation, termination, or removal by the board of directors.
- If the company secretary resigns, they should submit a resignation letter to the board of directors, stating the effective date of resignation.
- In cases where the company secretary's performance is unsatisfactory or there are other valid reasons for removal, the board of directors can decide to terminate their appointment.
- The decision to remove a company secretary should be made at a properly convened board meeting, and minutes of the meeting should be recorded, documenting the reasons for removal.
- Once the decision is made, the company should issue a termination letter to the company secretary, confirming the date and reasons for the removal.
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Legal Compliance and Documentation
All through the appointment or removal process, it's crucial to ensure compliance with the provisions of CAMA and any other relevant regulations. All the decisions related to the appointment or removal of a company secretary should be documented accurately in the company's records, including minutes of meetings, resolutions, and correspondence.
- Companies should keep a register of company secretaries, detailing the names, dates of appointment, and dates of cessation of each company secretary's tenure.
- Companies should also update relevant regulatory authorities, such as the Corporate Affairs Commission (CAC), regarding changes in company secretaries as required by law.
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5. Seek Professional Advice
Conclusion
Appointing or removing a company secretary under CAMA in Nigeria requires careful consideration of legal requirements, proper documentation, and adherence to corporate governance principles. By following the steps outlined in this guide and seeking professional advice when necessary, companies can ensure a smooth and legally compliant process for appointing or removing their company secretary, thereby facilitating effective corporate governance and regulatory compliance.
What are the CAC Compliance requirements for appointing Company Secretaries in Nigeria?
CAMA 2020 sets out specific requirements regarding the qualifications of persons to be appointed as company secretaries.
For private companies, the CAMA 2020 did not provide specific requirements for the type of person that can be appointed a company secretary in a Nigerian company but rather states that such person shall be one with requisite knowledge and experience to discharge the duties of a company secretary in Nigeria.
For public companies in Nigeria, the proposed secretary must be a member of the Institute of Chartered Secretaries and Administrators, or a legal practitioner qualified to practice law in Nigeria, a member of any professional body of accountants, a person who has held the position of a public company secretary for at least three years in the five years preceding period before their current appointment, or a Firm of professionals [who are either lawyers or members of the above Bodies].
What are the Duties of Company Secretaries in Nigeria?
Under CAMA 2020, it is the duty of company secretaries to attend meetings with the company members, its board of directors and its committees and to ensure compliance at those meetings; maintain all Company Registers required to be maintained by CAC; render returns and send notifications to the Corporate Affairs Commission, and carry out other administrative and secretarial duties as directed by the Company.
How to Appoint or Remove/Change Company Secretaries in Nigeria
To change a company secretary, such change is effected by a resolution of the board of directors of the company. For private companies which can have only one director and which has no requirements for the appointment of a secretary, where one exists, the director[s] are the ones that appoint or remove secretaries. If the company has only one director, then that director has the power to appoint or remove a secretary.
For public companies in Nigeria, the CAMA stipulated specific conditions for the removal of its company secretary by its board of directors:
Issuance of a notice to the secretary of their intention to remove him. Reasons why they wish to remove the secretary must be stated;
Give the secretary a period of seven days within which to make his defence or give him seven days option to resign;
Secretary can resign or make defence as stipulated, but if the secretary doesn’t, the Board of Directors can go ahead to remove him from office as the company secretary, then make a report of same to the next Annual General Meeting.
Where the secretary [in the public company] fails to resign but instead makes a defence but the Board considers the defence insufficient on the grounds that the reason to remove him is fraud or serious misconduct, the Board of Directors can pass their Board resolution removing the secretary, then report same to the next Annual General Meeting. Conversely where the grounds for intended removal is for any reason other than fraud or misconduct, the Board can suspend the secretary and report the suspension at the next General Meeting—in that case the secretary can be removed with the approval of the General Meeting.
Updating the Register of Company Secretaries
In Nigeria, only public companies are required to maintain a Register of Secretaries and, upon a change of the company secretary, the Register of Secretaries should be updated with the secretary’s name, address and email address. Where the new secretary is a corporate body, then its corporate name, principal place of business and email address will be added to the Register.
This is not a compliance requirement for private companies in Nigeria, though.
Reasons for changing your Company Secretary
There are numerous scenarios under which a company can change its company secretary, and these include, but are not limited to the following: resignation, death, retirement, tenure expiration, removal by the board of directors via a Resolution, appointment of new secretary, or even change in company needs which may necessitate the company appointing a new secretary.
Documents required for the Change of Company Secretary with CAC
For private companies the requirements are means of identification of the [new] secretary [if an individual]; particulars/proof of registration [if corporate], the appointment letter of the secretary and date of appointment of new secretary.
For public companies all the aforementioned will be supplied, together with a resolution of the General Meeting where such secretary was removed, or the board resolution removing the secretary where the removal was effected by the Board of Directors rather than the General Meeting.
Timeline of Notification to CAC for Change of Company Secretary
Where a company changes its secretary, or appoints a new one, that company is expected/required to file a Notice of Removal or Appointment of Secretary with the CAC within fourteen days after the resolution for same. Failure to file same within the stipulated time frame will attract [monetary] penalty for default.
Procedure for Changing Company Secretary at the Corporate Affairs Commission
The CAC-Accredited agents helping you to file your Change of Company secretary information at the Corporate Affairs Commission will require the following information from you: company information, new secretary details: name of new secretary, email, phone number, service address, nationality, gender, residence, valid ID card [where the secretary is individual], date of appointment, date of removal of old secretary, and detail of authorized signatories of the company authorizing the change.
Timeline for Processing Change of Company Secretary at CAC
The Corporate Affairs Commission has the CAC online portal where accredited professionals [lawyers, chartered accountants and secretaries, law firms, accounting firms] can make post-incorporation applications and filings, pay processing fees to the CAC, and perform all post-incorporation matters. On the CAC online portal, there is no definite timeline to process filings for change in company secretaries, but the usual turnaround time is around five to eight working days. The agent handling the application can track the filing processing on the post-incorporation dashboard.
Upon approval, the Commission sends a notification email to the accredited agent handling the filing. At Kabbiz Legal & Advisory, we are accredited CAC Agents and can help your company with its change of secretary filings.
Additional Compliance Considerations with the CAC when filing for change of Secretary
You are fully advised to maintain good corporate governance structure: proper record-keeping [register of secretaries], compliance with legal obligations, and Annual returns filed up to date as at the time of filing for change of secretary. Where the annual returns filing of the company is not up to date, then the CAC will not allow any changes to be made to the company records until the company’s annual returns are filed up to date. You can find out more information about filing your annual returns by clicking: “How to File your Annual Returns in Nigeria with CAC”.
Conclusion
The office of the company secretary is very crucial in Nigerian corporate governance because secretaries are usually seen as being responsible for the company’s compliance with the law. For private companies which are not statutorily required to appoint company secretaries, they can appoint individual lawyers or a law firm to be its company secretary and solicitors to help with compliance requirements at the CAC.
At Kabbiz Legal & Advisory, we will be happy to guide you on all relevant processes required to change your company secretary and keep the Corporate Affairs Commission updated on your position. Please check below for our contact handles to see how we can advise you on your company’s compliance requirements upon changing its company secretary.
While we ensure its correctness, please note that this article is provided for information purposes only and does not constitute legal advice. We are not responsible for your use of the information provided herein. For proper guidance and further details on the subject, kindly contact us here.
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