{"id":181497,"date":"2023-06-02T07:24:49","date_gmt":"2023-06-02T06:24:49","guid":{"rendered":"https:\/\/legalvision.co.uk\/?p=181497"},"modified":"2026-04-01T00:54:52","modified_gmt":"2026-03-31T23:54:52","slug":"written-resolution","status":"publish","type":"post","link":"https:\/\/legalvision.co.uk\/corporations\/written-resolution\/","title":{"rendered":"What is a Written Resolution for Shareholders in the UK?"},"content":{"rendered":"\n

In the UK, shareholders may need to make certain decisions that go beyond the authority of the company\u2019s board of directors. These decisions, governed by the company\u2019s articles of association, shareholders’ agreement, and the Companies Act 2006<\/em>, require shareholder approval through resolutions. Shareholders can approve resolutions either at a general meeting or via a written resolution, a process permitted for private companies. This article explains written resolutions, how they differ from general meetings, and their advantages and limitations.<\/p>\n\n\n\n

What is a Written Resolution for Shareholders?<\/h2>\n\n\n\n

A written resolution is a formal decision made by shareholders without the need for a physical meeting. It allows shareholders to vote on company matters by indicating their agreement in writing, typically through signing a document or responding to an email.<\/p>\n\n\n\n

General Meetings<\/h3>\n\n\n\n

By default, companies must pass shareholder resolutions at shareholder meetings<\/a>. These meetings, commonly called general meetings, require shareholders to be physically present to vote (which may also be by electronic means such as a video call). Alternatively, a shareholder can appoint a proxy to vote on their behalf.<\/p>\n\n\n\n

Importantly, there must be a minimum number of shareholders (or their proxies) at a meeting for it to be lawful. This minimum number called a quorum, cannot be less than two for all companies with two or more shareholders. In practice, many companies amend their articles of association<\/a> to require more shareholders.<\/p>\n\n\n\n

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If a meeting is not quorate, any resolutions approved have no effect.<\/p>\n<\/div>\n\n\n\n

Written Resolutions<\/h3>\n\n\n\n

Private companies can bypass the need for a general meeting by using written resolutions, which save time and reduce administrative costs. Public companies, however, cannot use this method.<\/p>\n\n\n\n

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Example: A private company with five shareholders needs to approve a change to its company name. Instead of arranging a physical meeting, the directors can propose a written resolution. Each shareholder can then vote by signing and returning the resolution document, making the process more efficient and flexible.<\/span><\/p>\n<\/div>\n\n\n\n

Who Can Propose Written Resolutions?<\/h2>\n\n\n\n

Subject to your company\u2019s articles, both shareholders and directors can propose resolutions via the written resolution procedure. The procedure for each differs depending on whether the board is proposing the resolution or the shareholders. The following are generic procedure plans for both. However, you should consult a solicitor before implementing this because your articles may have specific rules. <\/p>\n\n\n\n

Procedure Proposed by the Board\u00a0<\/strong><\/td>Procedure Proposed by Shareholders<\/strong><\/td><\/tr>
The directors must send a copy of the resolution to every eligible shareholder. The copy can be in hard copy or electronic.<\/td>Any shareholder with 5% or more of the total voting rights can propose a resolution. A company can amend its articles so that the threshold is lower. The shareholder may be liable to the company for the expense of circulating the resolution.<\/td><\/tr>
Directors should ensure copies are sent simultaneously to all eligible shareholders.<\/td>The directors must circulate the proposal within 21 days from the date they are the company is subject to the requirement to circulate the proposal. This depends on the exact procedure the shareholder that proposed the resolution used.<\/td><\/tr>
The directors should include a statement with a copy that explains to the shareholders how to signal their approval. Likewise, the statement should clearly explain the timeline for response and when the deadline for passing the resolution lapses’.<\/td>The circulation must include the text of the resolution and an explanation of its main purpose.<\/td><\/tr>
Shareholders indicate their agreement by signing and returning the resolution document or by responding affirmatively to an electronic communication.<\/td>Shareholders then have the opportunity to vote on the resolution in the same manner as a board-proposed resolution.<\/td><\/tr>
The resolution is passed once the required majority of eligible shareholders have signified their agreement within the specified timeframe.<\/td><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n\n\n Continue reading this article below the form\n <\/i>\n<\/a>\n
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