Any individual or corporate entity can be appointed as a company secretary, except for persons under 16 years old, disqualified directors, undischarged bankrupts (unless given court leave), and the company auditor.
Secretaries of private limited companies require no formal qualifications, but the secretary of a public limited company must meet strict criteria.
An individual, partnership or another company (including another group company) can all be appointed company secretary, and it is common for the director of a company to also act as the co-sec.
Co-Secs for private limited companies
Setting aside time to find the right candidate is essential, as a company’s directors share joint liability with the co-sec for any breaches of the Companies Act.
Any appointee needs to possess a broad range of skills, such as a good working knowledge of business law, finance and corporate governance, and excellent organisational and communication skills.
A co-sec must be honest and reliable. The company secretary has access to confidential company information which they must keep secure, and they must also be able to deal sensitively with the personal details of individuals.
Whilst as a company officer they have a duty to act in the best interests of the company, the co-sec is also the key point of contact for shareholders. A company secretary is therefore of most value to the company if they can offer independent opinions and views to directors.
Co-secs for public limited companies
The extra requirements to consider when appointing a company secretary for a PLC are set out in s273 of the Companies Act 2006.
Among them is the requirement that directors must ‘take all reasonable steps’ to ensure an appointee ‘is a person who appears to them to have the requisite knowledge and experience to discharge the functions of secretary of the company’.
The co-sec must also satisfy one or more of the following criteria:
- been company secretary of a public company for at least 3 out of the 5 years immediately before their new appointment;
- be a barrister, solicitor or advocate;
- be a person who ‘by virtue of his/her holding or having held any other position or his/her being a member of any other body, appears to the directors to be capable of discharging the functions of secretary of the company’.
- be a member of any of the following bodies:
- Institute of Chartered Accountants in England and Wales;
- Institute of Chartered Accountants of Scotland;
- Association of Chartered Certified Accountants;
- Institute of Chartered Accountants in Ireland;
- Institute of Chartered Secretaries and Administrators;
- Chartered Institute of Management Accountants;
- Chartered Institute of Public Finance and Accountancy.
