How important is a company secretary? Why does a Hong Kong limited company needs one?

How important is a company secretary? Why does a Hong Kong limited company needs one?

Firstly, in Hong Kong, according to the Companies Ordinance, appointing a company secretary is mandatory, every company should have one. The secretary, if an individual must ordinarily reside in Hong Kong; or if a body corporate, must have its registered office or a place of business in Hong Kong. The sole director of a private company cannot be the company secretary.

Secondly, a company secretary plays a complex, multi-faceted and very important role within a company or organization. A company secretary is responsible for maintaining the statutory book, including register of shareholders and directors; organizing, preparing agendas for and taking minutes of board meetings and annual general meetings; alternation of directors or company secretaries; transfer of share; monitoring changes in relevant legislation and the regulatory environment and taking appropriate action; and liaising with lawyers and auditors. Company secretaries are the company’s named representative on legal documents, and it is their responsibility to ensure that the company and its directors operate within the law. It is also their responsibility to maintain company records, such as lists of directors and shareholders, and annual accounts.

In order to handle all the tasks mentioned above, a company secretary should be well knowledged and experienced. Some directors would appoint a friend or family as company secretary because they had to have one, and they were not able to complete the tasks probably as the role of the company secretary is largely a legal one.

The roles and responsibilities of company secretaries in Hong Kong have increased substantially and become more complex as demands for better corporate governance have grown. If you have a good company secretary, directors are free to concentrate on the smooth running of the company, and your company will probably achieve a higher valuation.