www.GovernanceStudio.ca

Greetings!

Okay, I know the title is a little out there, but I promise I will bring it home.

 

Besides, as I was trying to decide if I could name a column the Dead Squirrel Conundrum, I was in a taxi, glanced out the window and... guess what I saw?

 

Yup, you got it!

 

 

Cheers,

Sylvia

The Dead Squirrel Conundrum

So, here's the story. I'm a "noticer". I see little details that are out of place, sometimes from miles away. I'm the one that rides in a car (or taxi), glances out of the window for a second, and I invariably see the poor squirrel who wasn't speedy enough on his last trip across the road.

 

Similarly, I can be flipping through a minute book, researching a question, and for no good reason, manage to spot the typo on page 13 of the board minutes from a year ago or ten years ago. Sheesh! I hate that.

 

If you're a bit like me (and, if you are a Corporate Secretary, I suspect you are), imperfection makes you crazy. Other people's imperfection - a little crazy, your own - a lot crazy.

 

But what do you do about that typo in the minutes? The typo that indicates the project approved was $13 million instead of $31 million as is clearly stated in the text two paragraphs above.

 

I'll give you three choices. Pick your favourite then read on:

 

 

  1. You take the page out of the minute book and fix the typo, after all it isn't a signature page and clearly the intent was that the minutes be correct.
  2. You bring a revised version of the minutes forward to the directors to approve "as amended" at their next meeting.
  3. You ignore it and move along.
 

 

 

 

 

As in so much of our complicated governance world, it's not so much about right and wrong, as it is about better and safer (read that as, less long-run risk).

 

So believe me, I hate this answer, but the best thing to do is... ignore it and move along. First off, the rest of the minutes and all of your back up documents will show, on balance, the clearly intended amount.

 

Secondly, you won't be asking your directors to make a minor change that will, at the very least, annoy them with unnecessary process when their time and focus is more valuably spent on strategic issues. Even worse, you may be asking directors who weren't on the board at the time to revise an earlier set of minutes - not good.

 

Lastly, and by far most importantly, you won't be jeopardizing the validity of every set of minutes you have ever prepared! If that sounds a little far-fetched and extreme to you, just take a minute and picture the following scene with me.

 

Five years or ten years down the road, the unthinkable has happened and your company is defending itself in an "armageddon" lawsuit that will decide if it survives or not. Lo and behold, the crux of the matter is whether the board was duly diligent in deciding to proceed with a project that has very unfortunately gone south.

 

A key piece of the board's defense is the minutes that show their decision making process. And, just to be thorough, the litigator on the other side has asked you, as Corporate Secretary, to take the stand.

 

She asks you a seemingly innocuous question...

 

"Have you ever changed minutes that were already approved by the Board?"

 

What do you say? Do you lie under oath and say, "No, never! Every record we have is full and true and complete." Although it is an option, I'm pretty certain you aren't going to go there.

 

Instead, you answer truthfully, "Well, only very occasionally, when there were tiny typos, I would make a correction to show the proper intention in the minutes." Innocent enough, right?

 

Well, if the board's critical records - the minutes - are in question, any litigator worth her salt, will follow this next little trail: "So, let me get this straight. When there was nothing at stake, when it didn't matter, you made "corrections" to your minutes, right? And, you want us to believe that when it's a game changer and critically important to show, perhaps like right now, that the directors followed great process and were duly diligent, that you would never "adjust" your minutes. Is that right?"

 

Suddenly it gets very quiet and I am feeling your pain, because at that instant there is no good answer to the question.

 

See what I mean?

 

 

Questions? 

Send me an email at sylvia@governancestudio.ca if you have a question about a governance practice or a corporate secretarial procedure.

  
I will reply to you privately. With your permission, I will share the question and answer (but not your name or organization) in an upcoming newsletter.

 

Coming up

My new book is nearly finished! Stay tuned for more information about:

 

AAA+ Minutes- The three must do fundamentals and 100s of practice tips for writing minutes that protect your organization and its directors.  

  

Here's a sneak peek quote from one of the reviewers: 

 

 

"Sylvia Groves is a Governance Goddess. She's demonstrated her divine status once again by writing a book that is as clear and straightforward as her advice - and as the minutes she would have us write. While some of her sage advice is focused on compliance with Canadian law and practice, most of it applies to all kinds of legal and regulatory schemes, and all of it is practical and wise. Thanks, Sylvia!"

  

~ Bob LammAssistant General Counsel and Assistant Secretary 

Corporate Governance, Legal Division Pfizer Inc., New York ~

 

 

What Clients Say

"The best part of working with Sylvia was that she has a very clear vision on how to help an organization and is able to articulate it in layman's terms. She also thinks quickly on her feet and can shine a light on situations from different perspectives. She stays impartial, doesn't take sides and is capable of making us all feel heard."

 

                                                ~Yvonne Basten, Vice and Past President 2011 Savoir Faire ~

Shout Outs

Thanks to all my new Twitter followers this month!

 

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