Board Secretary

Role, Duties, Independence, and Importance in Corporate Governance

First: Introduction

The board secretary is among the positions long treated as a simple administrative role, with duties limited to recording minutes and organizing meetings. This traditional view has long been overtaken by modern governance reality. The board secretary today has become a pivotal pillar of the governance system, a silent guardian of the soundness of board decisions and their compliance with regulations, and a trusted advisor to the chairman and members on all matters of governance procedures and compliance.

In the Saudi system, having a qualified and independent secretary has become an explicit regulatory requirement for listed companies, with the Corporate Governance Regulations precisely defining their competencies and responsibilities. This regulatory development reflects an advanced understanding of the importance of this position in ensuring quality of board work. This article reviews the secretary’s role in depth: definition, responsibilities, qualifications, relationship with the board and management, challenges, and best practices for empowering them to perform their role.

💡  Key Insight The board secretary is not an administrative employee but a governance guarantor. Their fundamental function is not organizing logistics but ensuring the board operates within a sound legal framework, makes documented decisions, and complies with governance requirements. A board with a weak secretary operates in regulatory blindness, regardless of member competence.

Second: Regulatory Framework

1. Saudi System

The Saudi Corporate Governance Regulations explicitly state:

• Mandatory Appointment: Every listed company must have a formally appointed secretary.
• Appointment Authority: The secretary is appointed by board decision.
• Qualifications: Must possess necessary competencies and appropriate experience.
• Reporting Line: Reports directly to the board, not to executive management.
• Dedication: In large companies, preferably full-time.
• Independence: Must enjoy professional independence enabling them to perform duties without pressure.

2. International Practices

In British and Commonwealth systems, the secretary enjoys very high status, known as Chartered Secretary. In the United States, called Corporate Secretary with essentially the same role. In the European Union, the position takes various forms but the role’s essence is similar: governance guarantor and link between board and management.

Third: Main Responsibilities

1. Organizing Board Meetings

1.1 Meeting Preparation

• Preparing Agenda: In coordination with chairman and CEO.
• Collecting Documents: From management and consultants.
• Distributing Meeting Pack: Before the meeting with sufficient lead time (5-7 days typically).
• Ensuring Completeness: Each item supported by necessary documents.
• Verifying Quorum: Expected attendance meets legal quorum.

1.2 During the Meeting

• Recording Attendance: Per approved list.
• Documenting Deliberations: With sufficient detail to document discussion.
• Recording Decisions: Accurately, including votes and objections.
• Alerting Chairman: To any incomplete or non-compliant procedure.
• Providing Procedural Advice: To the board when needed.

1.3 After the Meeting

• Preparing Minutes: Within defined deadline (typically few days).
• Circulating to Members: For review and comments.
• Modifying Based on Feedback: Before final approval.
• Signing and Filing: In official minutes register.
• Following up on Implementation: And reporting developments.

2. Maintaining Records and Documents

2.1 Main Registers

• Board Meetings Register: All minutes in chronological order.
• Board Decisions Register: Summary of each decision with reference.
• Committee Register: Minutes and decisions of each committee.
• Assemblies Register: Minutes and decisions of general assemblies.
• Shareholder Register: In coordination with Securities Depository Center.
• Conflict of Interest Register: Disclosures and transactions.
• Membership Register: Member data and membership periods.
• Articles of Association: And amended founding documents.

2.2 Storage Standards

• Security: Physical and electronic document protection.
• Confidentiality: Restricting access to authorized.
• Availability: Quick retrieval when needed.
• Duration: Retaining records for legally specified periods.
• Electronic Documentation: Backups in multiple locations.

3. Regulatory Compliance and Disclosure

3.1 Following Regulatory Requirements

• Saudi Companies Law: And its disclosure requirements.
• Corporate Governance Regulations: And periodic disclosure requirements.
• Capital Market Authority Regulations: For listed companies.
• Tadawul Regulations: Continuous listing requirements.
• Sectoral Regulations: For companies in regulated sectors.

3.2 Disclosures to External Parties

• Immediate Disclosures: For material events to Tadawul.
• Periodic Disclosures: Quarterly and annual.
• Annual Governance Reports: Within annual report.
• Ministry of Commerce Updates: On any changes in members or articles.
• Authority Disclosure: On any discovered regulatory violations.

4. Guidance and Advisory

4.1 For the Chairman

The secretary is the closest advisor to the chairman on procedural and governance matters. Provides:

• Advice on preparing agendas.
• Alert to new regulatory requirements.
• Support in managing relationships with members.
• Help in resolving procedural issues.

4.2 For Board Members

• Answering procedural inquiries.
• Providing information on duties and responsibilities.
• Guidance on interest disclosure procedures.
• Support for new members in onboarding programs.

4.3 For Executive Management

• Clarifying governance requirements for document preparation.
• Coordinating board presentations.
• Following up on board decision implementation.
• Guidance on material disclosures.

5. Organizing General Assemblies

The secretary is the de facto organizer of general assemblies, in coordination with the chairman and management. Responsibilities:

• Advance Preparation: Preparing the notice, documents, logistics.
• Shareholder Communication: Delivering notices and documents.
• Coordination with Tadawulaty: For electronic voting.
• Quorum Monitoring: During assembly convening.
• Assembly Minutes Recording: Accurately and comprehensively.
• Results Disclosure: Immediately after the assembly.

6. Overseeing Board Committees

The secretary plays an important role in coordinating board committees’ work:

• Scheduling Committee Meetings: In coordination with their chairs.
• Preparing for Committee Meetings: Or supervising attendees.
• Recording Committee Minutes: Or supervising same.
• Coordination Between Committees and Board: In raising committee recommendations.
• Following up Committee Decisions: In executive management.

📌  Note The secretary’s responsibilities exceed traditional matters known to most companies. In small companies, the position can combine with other tasks. In large listed companies, the position needs a specialized team led by the secretary, including governance experts, legal experts, and investor relations specialists.

Fourth: Required Qualifications and Competencies

1. Academic Qualifications

• University Degree: In law, business administration, accounting, or equivalent.
• Specialized Professional Certifications: Such as CGI (Chartered Governance Institute), CIS, or Saudi governance certifications.
• Higher Studies: Master’s in governance or commercial law preferred.

2. Professional Experience

• 7-10 Years Experience: In governance, compliance, or legal affairs.
• Joint-Stock Company Experience: Especially listed.
• Deep Knowledge of Saudi Regulations: Companies Law, Governance Regulations, CMA regulations.
• International Experience: Advantage in regionally or internationally active companies.

3. Personal Competencies

• Integrity and Trustworthiness: Foundation of position due to handling sensitive information.
• Objectivity: Ability to maintain impartiality between different parties.
• Precision and Attention to Detail: In minutes and document handling.
• Communication Skills: Written and verbal, Arabic and English.
• Pressure Management: Especially during assembly periods and material disclosures.
• Emotional Intelligence: Dealing with diverse personalities in board and management.
• Governance Sense: Ability to anticipate problems before they escalate.

4. Technical Knowledge

• Technology Proficiency: Board management systems, Tadawulaty, disclosure systems.
• Information Security Knowledge: Protecting sensitive board documents.
• Familiarity with Virtual Meeting Platforms: And their security.

Fifth: Secretary Independence

1. Why Independence Matters

By virtue of their position, the secretary is privy to everything occurring in the board and committees. They see disagreements, perceive conflicts, discover violations. If subordinate to executive management or chairman in an unprofessional manner, they may face pressure to hide information, modify minutes, or ignore violations. Their independence is a fundamental guarantee of integrity of board work.

2. Dimensions of Independence

2.1 Administrative Independence

• Direct Reporting to the Board: Not to executive management.
• Appointment by Board Decision: Not by CEO.
• Dismissal by Board Decision: Usually by reinforced majority.
• Performance Evaluation by Board: Or governance committee.

2.2 Financial Independence

• Remuneration Set by Board: Not by CEO.
• Independent Budget: For managing secretariat and its activities.
• Authority to Engage External Experts: Without executive management approval.

2.3 Professional Independence

• Right to Raise Concerns: To board or audit committee.
• Right to Seek Legal Counsel: Independent when needed.
• Protection from Retaliation: In case of reporting violations.

3. Independence Challenges in Reality

Despite regulatory texts, secretaries face real challenges maintaining their independence:

• Operational Reality: Daily work is with executive management more than the board.
• Social Pressures: Personal relationships may affect objectivity.
• Career Threat: Fear of losing position may drive compliance.
• Financial Incentives: In companies combining the position with another executive role.

Sixth: Relationships with Other Parties

1. With the Chairman

Partnership and coordination relationship. The chairman relies on the secretary for everything related to board management. The secretary relies on the chairman for support and authority. A successful relationship features:

• Nearly daily communication.
• Complete transparency on governance matters.
• Mutual respect for roles.
• Trust in competence and integrity.

2. With the CEO

Relationship of respect and boundaries. The secretary needs executive management cooperation to perform duties but is not subordinate to them. Most important principles:

• Cooperation in Operational Matters: Document preparation, presentation coordination.
• Respect for Competencies: The secretary does not interfere in executive decisions.
• Independence in Governance Matters: Not subject to management directives in these.
• Regular Communication: To ensure harmony.

3. With Board Members

Relationship of service and guidance. Every board member has the right to receive support and guidance from the secretary. Principles of this relationship:

• Equality Among Members: No discrimination between one member and another.
• Confidentiality: Maintaining each member’s privacy.
• Quick Response: To inquiries and requests.
• Professional Guidance: Especially in governance matters.

4. With Board Committees

The secretary supports committee work with the same spirit they support the board. In large companies, each committee may have a deputy secretary reporting to the main secretary.

5. With External Parties

• Regulatory Authorities: Capital Market Authority, Tadawul, Ministry of Commerce.
• External Auditor: On audit governance matters.
• Consultants: Legal, governance.
• Shareholders: Especially during assembly periods.

⚠️  Caution One of the greatest risks to the secretary is bias toward executive management by virtue of daily work with them. Mature companies fortify the secretary with administrative and financial arrangements that protect them from this bias: direct reporting to the board, evaluation by the board, remuneration set by the board, and legal protection when reporting violations.

Seventh: Common Challenges

1. Resource Challenge

In many companies, the secretary is given big tasks without sufficient resources: weak team, old systems, limited budget. This leads to:

• Delays in preparing minutes.
• Gaps in disclosures.
• Weakness in following up decisions.
• Job burnout leading to resignation.

2. Authority Challenge

In some companies, the secretary is treated as a secondary employee unable to confront senior management. This weakens their ability to:

• Insist on correct procedures.
• Reject incomplete or defective documents.
• Report violations they discover.
• Request necessary information from management.

3. Regulatory Updates Challenge

The regulatory framework for governance is in continuous evolution. The secretary needs:

• Constant monitoring of updates.
• Continuous training.
• Network of colleagues for discussion.
• Subscription to specialized information services.

4. Confidentiality vs. Disclosure Challenge

The secretary is privy to very sensitive information and may face issues determining what to disclose and what to keep confidential. This requires high wisdom and sometimes independent legal counsel.

Eighth: New Secretary Onboarding

1. Onboarding Program

Upon appointing a new secretary, they should receive a comprehensive onboarding program including:

1.1 Company Knowledge

• Articles of association and founding documents.
• Ownership structure and major shareholders.
• Company strategy and objectives.
• Organizational structure and senior management.
• Financial statements and historical performance.

1.2 Board Knowledge

• Members’ CVs and experience.
• Board charter and internal regulations.
• History of meeting minutes (last two years).
• Committees and their members.
• Pending issues and decisions under implementation.

1.3 Governance Knowledge

• Saudi regulatory framework.
• International best practices.
• Company governance policies.
• Previous disclosure records.
• Commitments to regulatory authorities.

2. Initial Stages

• Week One: Meetings with members and senior management.
• First Month: Reviewing basic documents.
• Second Month: Attending a complete meeting without recording (for observation).
• Third Month: Taking full responsibility.

Ninth: Secretary Performance Evaluation

1. Importance of Evaluation

Secretary performance should be evaluated annually, not just as an employee but as a pillar of governance. Good evaluation motivates development and reveals gaps.

2. Evaluation Criteria

Criterion	Indicators	Proposed Weight
Minutes Quality	Accuracy, timeliness, comprehensiveness	20%
Decision Follow-up	Implementation rate within timeline	15%
Compliance and Disclosure	Quality and timing of disclosures	20%
Assembly Management	Success of assembly convening	15%
Board Support	Members’ satisfaction assessment	15%
Professional Development	Training and updating	10%
Independence Adherence	Performance integrity	5%

3. Evaluation Mechanism

• Self-Assessment: Submitted by the secretary.
• Assessment from Chairman: As direct supervisor.
• Assessment from Members: Confidential survey.
• Assessment from Executive Management: On aspects they interact with.
• Review from Governance Committee: For final evaluation.

Tenth: Best Practices

1. At the Institutional Level

• Clear Charter: Defining secretary’s role and authorities.
• Administrative and Financial Independence: Regulatorily protected.
• Sufficient Team and Resources: Proportional to company size.
• Advanced Technical Systems: For board and document management.
• Professional Development Budget: For training and conferences.

2. At the Personal Level

• Investment in Development: Certifications, courses, professional network.
• Building Relationships: With all parties professionally.
• Self-Documentation: For every decision, communication, event.
• Maintaining Objectivity: In all circumstances.
• Positive Courage: In reporting violations.

3. At the Relationships Level

• Transparency with Chairman: No secrets.
• Respect with Executive Management: While maintaining distance.
• Serving Members: Equally and without bias.
• Professionalism with External Parties: As company’s face.

Conclusion

The board secretary is a position deserving reassessment in many Saudi companies. Their role is no longer mere administrative duties but has become a pillar of the governance system, a guardian of soundness of board decisions and their compliance, and a trusted advisor ensuring the company operates within a sound legal framework.

Investing in qualifying the secretary, empowering them with resources and authorities, and protecting their independence, is an investment in the company’s governance as a whole. Companies that recognize this truth build a strong system protecting them from regulatory and legal risks, and giving them competitive advantage in a continuously evolving capital market. A strong, independent, qualified secretary is not a luxury but a necessity for every company aspiring to be a model in sound governance.

🎯  Essential Points to Remember (1) The secretary is a governance position, not merely administrative. (2) The Saudi system mandates their presence in listed companies with specific specifications. (3) Their responsibilities include organizing meetings, maintaining records, compliance, guidance, organizing assemblies, and managing committees. (4) Qualifications include certifications, experience, personal competencies, and technical knowledge. (5) Administrative, financial, and professional independence is a fundamental guarantee. (6) Must report directly to the board, not executive management. (7) Relationships with chairman, CEO, and members require delicate balance. (8) Challenges include resources, authority, regulatory updates, and confidentiality issues. (9) New secretary onboarding requires comprehensive program in early months. (10) Annual evaluation by defined criteria motivates development and reveals gaps.

Frequently Asked Questions

What are the main responsibilities of a board secretary in a Saudi listed company?

The board secretary's responsibilities span six interconnected areas. Organizing board meetings covers preparing the agenda in coordination with the chairman and CEO, collecting documents and distributing the complete meeting pack five to seven days in advance, recording attendance and deliberations during the meeting with sufficient detail to document discussion, alerting the chairman to any procedural deficiency, preparing minutes within days of the meeting, circulating them for member review, and following up on decision implementation. Maintaining records covers the board meetings register, decisions register, committee register, assemblies register, shareholder register, conflict of interest register, membership register, and founding documents. Regulatory compliance and disclosure covers monitoring requirements under the Companies Law, CMA regulations, and Tadawul listing rules, and managing immediate disclosures for material events, periodic disclosures, annual governance reports, and Ministry of Commerce updates. Guidance and advisory extends to the chairman on procedural and governance matters, to board members on duties and disclosure procedures, and to executive management on governance requirements for document preparation. Organizing general assemblies from notice and documents through electronic voting coordination with Tadawulaty to immediate results disclosure. Overseeing board committees through scheduling, preparation, minute-taking, and follow-up on committee decisions within executive management.

Why is board secretary independence critical and how is it protected in Saudi Arabia?

The board secretary is privy to everything occurring in the board and committees — disagreements, conflicts of interest, and potential violations — making their independence a fundamental guarantee of board integrity. Without genuine independence they face pressure to hide information, modify minutes, or ignore violations. Independence operates across three dimensions. Administrative independence is protected by direct reporting to the board rather than executive management, appointment and dismissal by board decision rather than CEO decision, and performance evaluation by the board or governance committee. Financial independence is protected by having remuneration set by the board, an independent budget for secretariat activities, and authority to engage external experts without executive management approval. Professional independence gives the secretary the right to raise concerns directly to the board or audit committee, seek independent legal counsel when needed, and receive protection from retaliation when reporting violations. In practice the greatest threat to independence is bias toward executive management through daily working proximity, and mature Saudi companies address this by ensuring all four administrative and financial protections are contractually in place rather than merely stated in policy.

What qualifications and competencies are required for a board secretary in Saudi Arabia and how is performance evaluated?

Qualifications span four dimensions. Academic requirements include a university degree in law, business administration, or accounting, specialized professional certifications such as the Chartered Governance Institute CGI credential or Saudi governance equivalents, with a master's in governance or commercial law preferred. Professional experience of seven to ten years in governance, compliance, or legal affairs in joint-stock companies, with deep knowledge of the Saudi Companies Law, CMA governance regulations, and listed company implementing regulations. Personal competencies include integrity and trustworthiness as the non-negotiable foundation for handling sensitive information, objectivity and impartiality between parties, precision in minutes and document handling, written and verbal communication in Arabic and English, emotional intelligence for managing diverse board and management personalities, and governance sense to anticipate problems before they escalate. Technical knowledge covers board management systems, Tadawulaty, disclosure platforms, and information security for protecting sensitive documents. Annual performance evaluation uses five weighted criteria: minutes quality covering accuracy timeliness and comprehensiveness at 20%, compliance and disclosure quality at 20%, decision follow-up implementation rate at 15%, assembly management success at 15%, and board support measured by member satisfaction at 15%, with professional development and independence adherence making up the remainder.

References and Sources

• Corporate Governance Regulations issued by the Capital Market Authority.
• Saudi Companies Law (Royal Decree M/132).
• Implementing Regulations of the Companies Law for Listed Joint-Stock Companies.
• Chartered Governance Institute (CGI) — Best Practices for Company Secretaries.
• ICSA Code of Practice for Company Secretaries.
• OECD Principles of Corporate Governance.
• UK Corporate Governance Code — Role of Company Secretary.
• Chartered Institute — Specialized Certification Programs.
• Spencer Stuart — The Evolving Role of the Corporate Secretary.
• PricewaterhouseCoopers — Corporate Secretary Practices Report.