The Role of a Company Secretary

A Company Secretary is simply defined in the Companies Act as “an officer of the company”. Until 1999 the appointment of a Company Secretary was a matter of choice and it remains so in private companies, but the Companies Amendment Act, No.37 of 1999, which became effective on 30 June 1999, made it mandatory for all public companies (excluding share block companies, Section 21 companies, external and incorporated companies, all of which are deemed to be public companies for the purposes of the Companies Act) to appoint a Company Secretary. Section 268G of the Companies Amendment Act, 1999 states that:

“The secretary’s duties include, but are not restricted to –

• Providing the directors of the company collectively and individually with guidance as to their duties, responsibilities and powers;
  
• Making the directors aware of all law and legislation relevant to or affecting the company and reporting at any meetings of the shareholders of the company or of the company’s directors, any failure to comply with such law or legislation;
  
• Ensuring those minutes of all shareholders’ meetings, directors’ meetings and the meetings of any committees of the directors are properly recorded in accordance with section 242;
  
• Certifying in the annual financial statements of the company that the company has lodged with the Registrar all such returns as are required of a public company in terms of this Act and that all such returns are true, correct and up to date;
  
• Ensuring that a copy of the company’s annual financial statements is sent, in accordance with section 302, to every person who is entitled thereto in terms of this Act.”
  

Section 268H(1) of the 1999 Amendment Act provides that “The first names, or the initials thereof, and the surname of the secretary of a public company shall be stated on every trade catalogue, trade circular and business letter bearing the company’s name”.

Traditionally, the Company Secretary was the chief administrative officer of a company and matters such as finance, tax, insurance and human resources fell under his mandate.  In the increasingly regulated environment in which we operate in South Africa, it is becoming difficult for a Company Secretary to keep abreast of all the changes and have sufficient knowledge of all these disciplines to be able to carry out his duties effectively in the role of general overall administrator. In the larger companies there is usually a separate finance department run by a Chartered Accountant, who is often the financial director of the company. This department might also handle the company’s tax affairs.  There might also be a separate legal department and a human resources department.  So the role of the Company Secretary, whilst being given increasing weight by legislation, might not in itself be seen as a full time occupation and might be combined with another function, such as the legal or compliance function, or it could be outsourced.

To learn more about qualifying to become a Company Secretary contact your local branch of the Southern African Institute of Chartered Secretaries and Administrators (“Chartered Secretaries South Africa” or “ICSA”) and ask them about their four year diploma course and qualifying Board examinations. No one should consider taking on the role of Company Secretary without being fully conversant with what the role entails, the duties required of a Company Secretary and how to perform them. It is a very responsible role and the ICSA course is the only one specifically designed for this purpose.

In our capacity as professional company secretaries we also offer to mentor inexperienced Company Secretaries to give them support and confidence in performing their duties.