Why What Is A Corporate Resolution Isn't What You Think

What is a corporate resolution

A corporate resolution is a formal written record that documents a board or stockholder decision and authorizes follow-on actions. It names who approved an action, the exact action and conditions, the effective date, and who is authorized to sign subsequent documents.

This guide explains when to use a resolution, who must sign, and the steps to complete it efficiently. It also references governance basics to help founders and CEOs keep airtight records for financing, banking, and diligence. For governance basics, see the startup governance guide.

Startup decision framework for corporate resolutions

Founders often over-resolve small items and under-document major moves. The key is to map each decision to the right approver and capture it once, cleanly.

• Use a resolution when formal authority beyond an officer’s day-to-day powers is required: issuing shares, approving a priced round, adopting a stock plan, appointing officers, entering a major contract, opening bank accounts, or granting options.
• Prefer written consents for speed: written consents can compress approvals into 24–48 hours while staying compliant if the company captures signers, an effective date, and an audit trail (see Delaware General Corporation Law §228 for board/stockholder written consents).
• Keep resolutions narrow: one action, one authority, one effective date. Bundle actions only when signers and urgency match.
• Practical tactic: pre-wire signatures, attach a short memo and exhibits, and lock the signed PDFs with the e-sign audit certificate to create an audit-ready record.

Some startups rely on tools like ImBoard.ai to streamline routing and signature collection, keeping the memo, exhibits, and e-sign certificate linked to the executed consent for fast retrieval. For governance basics, see the startup governance guide. See also board templates for diligence at the board meeting templates page.

When do you need a corporate resolution?

For more insights on this topic, see our guide on Why How To Write A Resolution Isnt What You Think.

You need a corporate resolution whenever an action requires formal approval that officers cannot lawfully take by themselves. Typical triggers include issuing or authorizing new shares, amending the charter or bylaws, appointing or removing officers, adopting or amending an equity incentive plan, entering major contracts above a threshold, and opening or changing bank accounts.

If company bylaws, charter provisions, or investor agreements require approval, document the action with a resolution even if the action feels routine. A documented resolution prevents diligence delays and reduces the chance of bank KYC rejections.

What is a corporate resolution? The plain-English answer

What is a corporate resolution?

A corporate resolution is a concise authorization that validates transactions, filings, and issuances by tying them to a formal vote. It’s not the contract; it’s the permission slip that makes contracts and equity actions enforceable and auditable.

Actionable drafting tips:

• Cite the authority once (bylaws, charter, or relevant statute such as Delaware General Corporation Law). That citation anchors the resolution to legal power.
• Name executors precisely with full legal name and title, and include alternates. Exact naming prevents signature mismatches with KYC and cap tables.
• Attach exhibits for schedules such as grant lists or term sheets to keep the resolution focused and evidence-ready.

Minutes vs. written resolutions: decision tree

If the board met with proper notice, quorum was achieved, and minutes include the full text of the resolution and vote counts, minutes can serve as the record. If there was no meeting or you need speed, use written consents that collect the required signatures without delay.

Banks commonly expect a standalone banking resolution even if the approval is captured in minutes. Always prepare a separate banking resolution for KYC and account opening.

Audit-ready minutes checklist:

• Quorum, precise vote counts, and any conflicts or recusals are recorded.
• The full text of the resolution and the effective date are included in the minutes.
• The corporate secretary certifies the minutes when extracts are shared with third parties.

Who signs what: board vs stockholders

Most routine corporate approvals for startups are board-level actions, while structural changes require stockholder approval. Boards authorize operational matters; stockholders authorize charter changes and new classes of stock.

Board-only approvals (typical)

• Boards commonly approve appointment and removal of officers, option grants under an approved plan, 409A acknowledgements within budget limits, and opening bank accounts unless investor documents require otherwise.
• Maintain a one-page approval matrix mapping decision thresholds to approvers to speed routing and reduce errors.

Stockholder approvals and protective provisions

• Stockholders must approve charter amendments, increases in authorized shares, and creation of new share classes.
• Preferred investors often require separate class consents for charter changes and many priced financings; read the charter and investor rights agreement before circulating consents.

Watchouts:

• Separate class votes require separate signature pages for each class.
• Anti-dilution or conversion provisions can limit the scope of a proposed approval and must be checked before circulation.

Thresholds: majority, supermajority, unanimous

• Boards normally act by a simple majority of directors present at a meeting with quorum, though bylaws or charter provisions can require different thresholds or unanimity for certain actions.
• Stockholder actions often require a majority of outstanding shares, and charter amendments frequently require a supermajority and separate class votes.
• Preferred class votes typically require a majority or supermajority of that class; always build the ownership math before drafting.

The 24-hour written consent playbook

Written consents are the fast lane for boards and stockholders because Delaware law allows action without a meeting if the required number of signatures are obtained in writing (Del. Code tit. 8 § 228). Use written consents to close financings and approve urgent contracts quickly — timing depends on signer availability and any special thresholds in governing documents.

Execution pattern that works:

1. Draft a one-page memo, a concise resolution, and attach exhibits. This creates a single package for signers and reviewers.
2. Pre-wire signers by confirming which roles and classes must sign. Accurate pre-checks prevent lost signatures.
3. Route in waves by time zone with clear signing instructions and a consent window to capture signatures quickly.
4. Collect the audit trail: signed PDF and e-sign certificate, then store both in the data room for diligence.

Key legal checks:

• Verify whether bylaws require unanimous board consents or specify different thresholds and assume the stricter path if unsure.
• Confirm whether a majority of outstanding shares suffices for stockholder consents or whether charter provisions alter the threshold.

E-sign checklist:

• Provide named signature blocks that include titles and class identifiers. Clear signature blocks reduce KYC friction.
• Export and save the certificate of completion and lock the PDF. A locked PDF with the e-sign certificate is audit-ready in most contexts; note that some banks or counterparties may still request wet-ink signatures or additional attestations.
• Verify that legal names in signatures match the cap table and charter to avoid rework.

Common gotchas:

• Forgetting separate preferred class signature pages.
• Using meeting-only language in a written consent.
• Mismatched effective dates between the consent and related deal documents.

Real-world example: A Series B fintech stalled bank KYC for multiple days because there was no standalone banking resolution in the packet; adding a standalone banking resolution and a Secretary’s certificate cleared KYC quickly.

Startup triggers and banking: a checklist to avoid rework

Financing

• Priced rounds typically require board approval plus stockholder approval and often a charter amendment; include exhibits that show post-closing capitalization.

Equity and option grants

• Boards approve individual equity grants and should include an Exhibit A listing grantee name, number of shares, strike price, vesting schedule, and grant date.
• ESOP increases typically require stockholder approval and a charter amendment; tie grant dates to the 409A valuation and never backdate grants.

Banking resolution essentials (pass KYC)

• Banks commonly expect a formal banking resolution that includes company legal name, state of formation, and EIN. Missing one of these elements commonly triggers rejection.
• The banking resolution should authorize opening accounts, name authorized signers, specify transaction authority (including wire limits and dual control), and be accompanied by a Secretary’s certificate with specimen signatures.

Sample clearing language banks accept: “RESOLVED: that the Company is authorized to establish deposit and checking accounts with [Bank Name] and that [Name], [Title], and [Name], [Title], are each authorized signers on behalf of the Company.”

Common bank rejections and fixes:

• Missing EIN or incorrect state of formation → add the correct EIN and state to the header and Secretary’s certificate.
• No explicit bank or signer naming → restate and name the bank and the authorized signers.
• Outdated bylaws on file → attach a current bylaws excerpt and certify it in the Secretary’s certificate.

Templates and documentation: pass diligence, not busywork

Keep three core templates ready-to-go: Board Written Consent (single-action and multi-action), Stockholder Written Consent (with separate class signature pages), and Banking Resolution with Secretary’s Certificate and specimen signers. Ready templates reduce turnaround time and errors.

What a clean resolution includes:

• Company legal name, state, and EIN for third-party KYC and filings.
• A reference to the authority (bylaws or charter) to establish legal power.
• A precise description of the action with numbers, titles, and dates.
• A list of authorized officers to execute follow-on documents and an effective date.
• Proper signature blocks and a Secretary’s certificate when sharing with third parties.

Quality controls:

• File signed PDFs together with the e-sign certificate and exhibits for an audit trail.
• Use a disciplined redline workflow for drafts and lock the final signed versions to prevent unauthorized edits.
• Name files yyyy-mm-dd_action_board-or-stockholder.pdf for fast retrieval and consistent data room organization.

For small teams, platforms such as ImBoard.ai can host templates, track executed consents, and surface missing signatures during financing workflows, reducing the back-and-forth that stalls closings.

Real-world example: a seed startup used a one-page memo and a board written consent

For more insights on this topic, see our guide on Resolution Example Doesnt Work (Heres What Does).

with Exhibit A listing employee grants; the board e-signed quickly and auditors accepted the packet.

Who signs what — quick reference

• Recommend: CFO or GC drafts the resolution and memo to ensure legal and financial data accuracy.
• Agree: CEO or committee chair pre-clears scope and urgency to reduce signer confusion.
• Perform: Secretary certifies and files signed documents to create the formal record.
• Input: Lead investor, outside counsel, and the controller provide deal and accounting data.
• Decide: Board or stockholders sign as required by the bylaws, charter, and investor agreements.

Frequently Asked Questions

Q: Do I always need a resolution to issue equity to employees?
A: Typically yes — board approval is normally required to issue equity to employees. Include an exhibit listing each grant with name, share amount, strike price, vesting, and grant date to make the issuance audit-ready. Check your charter and any investor agreements for exceptions.

Q: Can I use written consents for closing a priced round overnight?
A: Often, yes — written consents can close a priced round quickly if the required number of board and stockholder signatures are collected in writing and the e-sign audit trail is preserved. Timing depends on signer availability and any special thresholds in your governing documents (see Del. Code tit. 8 § 228).

Q: Will minutes alone satisfy a bank’s KYC requirement?
A: Usually not. Many banks request a standalone banking resolution plus a Secretary’s certificate with EIN, state, named signers, and specimen signatures. Practices vary by bank.

Q: What if the charter requires separate class votes?
A: Each affected class must vote separately and you should prepare separate signature pages and calculate ownership percentages before circulation.

Q: How should we name final signed files for diligence?
A: Use a consistent pattern like yyyy-mm-dd_action_board-or-stockholder.pdf and include the e-sign certificate and exhibits in the same folder to make retrieval and auditor review fast.

Q: Can e-signatures be used on stockholder consents?
A: Yes — in most cases. Delaware recognizes written consents under DGCL § 228, and electronic signatures are generally valid under federal and state e-signature laws (E-SIGN Act, 2000; UETA, 1999). However, some banks, international counterparties, or specific contractual provisions may still require wet-ink signatures or additional attestations.

Q: Who should draft the initial resolution package?
A: The CFO or GC should draft the initial resolution package to ensure legal accuracy and accounting alignment; include a one-page memo, the concise resolution text, and exhibits.

Q: What are the most common consent execution errors?
A: Common errors are forgetting separate preferred-class signature pages, using meeting-only language in a written consent, and mismatched effective dates between the consent and deal docs; these issues delay KYC and diligence.

Q: When must the Secretary certify documents for third parties?
A: The Secretary should certify documents whenever third parties request verification, such as banks or auditors. The certificate should confirm current bylaws, the board composition, and specimen signatures.

Conclusion: accelerate decisions while keeping diligence clean

Treat resolutions as enablers, not paperwork. Map each action to the right approver, pre-wire signers, use written consents for fast execution when appropriate, and staple the e-sign audit trail to your data room. Do the small setup work now and your next financing closes while everyone else is still chasing signatures. For reusable templates, see the board meeting templates. If you’ve ever lost a deal because one missing signature held things up, you know this is worth fixing.

Glossary

For more insights on this topic, see our guide on The How To Draft A Resolution Secret Nobody Talks About.

• Fiduciary Duty: The legal obligation of board members to act in the best interests of the company and its shareholders, placing those interests above personal gain.
• Written Consent: A signed document that records board or stockholder approval without a meeting, valid when it collects the required number of signatures under the governing law and bylaws (see Del. Code tit. 8 § 228).
• Secretary’s Certificate: A signed corporate officer statement that certifies corporate facts (current officers, bylaws, and resolutions) and often includes signature specimens for KYC and filings.
• Banking Resolution: A formal corporate resolution that authorizes the company to open bank accounts, names authorized signers, and specifies transaction authorities to satisfy bank KYC.
• Board Minutes: The official written record of a board meeting, which can include the full text of resolutions and vote counts and may serve as the corporate record if properly noticed and approved.
• Exhibit A (Grant Schedule): A detailed attachment to a resolution that lists individual equity grants with grantee names, number of shares, strike price, vesting schedules, and grant dates for audit and payroll reconciliation.
• Cap Table Ownership Math: The calculation of outstanding shares and class-specific vote percentages used to determine whether the required voting thresholds are met for stockholder consents.
• E-sign Audit Certificate: The digital certificate produced by an e-sign platform that records signer identity, timestamps, and the audit trail used to validate electronic consents in due diligence.