Most business owners don’t think twice about meeting minutes—until a lender asks for a corporate resolution, a shareholder wants to review past decisions, or a plaintiff’s attorney starts poking around. Whether you’re a single-owner S-corp or a growing private company with outside investors, documenting decisions through minutes and consents is a core part of corporate governance—and a critical shield against personal liability. They’re not just a paper trail—they’re legal evidence that your company is operating properly and separately from its owners.
Why Do Corporate Minutes Matter?
Minutes serve as the official record of a corporation’s decisions. When properly prepared and maintained, they:
- demonstrate compliance with legal and procedural requirements;
- protect the corporate veil by showing the company is treated as a distinct legal entity;
- create accountability among shareholders, directors, and officers; and
- provide continuity by preserving the history of who decided what—and when.
Under Illinois law, for example, corporations are required to keep “correct and complete books and records of account,” including minutes of the proceedings of shareholders and directors. These aren’t optional for corporations—they’re statutory. Failure to keep these records can expose a company to legal challenges, and courts have cited lack of minutes as a factor in veil-piercing cases.
Shareholder and Director Meetings: What’s Required?
Most corporations are structured with shareholders, directors, and officers, each with different governance roles. State corporate statutes—and your own bylaws—typically require:
- an annual meeting of shareholders, where shareholders elect directors and address major matters; and
- an organizational or regular meeting of the board of directors, where directors elect officers and approve key company actions.
In closely held corporations, these meetings are often informal, and the same individuals may serve as shareholders, directors, and officers. Still, the law expects these roles to be observed separately—and documented accordingly. Even if you’re the sole owner, you should wear the ‘right hat’ for each decision and record which capacity you’re acting in. After each meeting, minutes should be prepared summarizing who was present, what was discussed, and what decisions were made. For example, at an annual shareholder meeting, the minutes might reflect the election of directors, while the board minutes that follow may document officer appointments, approval of compensation, or authorization of a lease or loan. If the corporation fails to hold these meetings or keep a record of them, it risks undermining the legal structure that separates the business from its owners.
What About Written Consents?
Illinois—and many other states—permit actions to be taken without a meeting, so long as they’re documented via a written consent signed by the required number of directors or shareholders. These consents carry the same legal weight as formal meeting minutes and are especially helpful for closely held companies where convening everyone isn’t practical. For example, a unanimous written consent of the board might authorize the company to issue shares, elect officers, or enter into a contract. The signed consent should be kept in the corporate records just like minutes—because without a written record, the action may not be legally effective. In Illinois, director consents must be unanimous unless otherwise allowed in the bylaws. For shareholder consents, the law allows written approval from holders of at least the minimum number of votes needed if a meeting were held—though proper notice must still be given to any non-signing shareholders.
What Should Corporate Minutes Include?
Whether you’re holding a formal meeting or documenting an action by consent, your records should include:
- date, time, and type of meeting (or note that it was a written consent);
- names of participants, including any absentees;
- proof of notice or waiver of notice, if applicable;
- list of matters discussed and resolutions adopted (e.g., “RESOLVED, that Jane Doe is elected as President…”);
- voting results, including whether actions were unanimous;
- adjournment time; and
- signature of the person recording the minutes (typically the corporate secretary).
In small corporations, it’s common to hold joint meetings of shareholders and directors—just note that clearly in the minutes, and document the appropriate decisions under each role. And don’t forget to store your minutes or consents in a central file—ideally both digitally and in hard copy—so they’re accessible when needed for diligence, audits, or internal reference.
A Few Words on Risk
Failing to follow corporate formalities—like keeping proper minutes—can expose owners to personal liability under ‘piercing the corporate veil’ theories. Courts routinely ask: Did the company maintain separate records? Did it follow its bylaws? Did it hold meetings and document decisions? A consistent paper trail helps answer ‘yes’ to each of those. Even in routine matters—such as declaring a bonus, approving a distribution, or ratifying a transaction—minutes serve as legal proof that the action was properly authorized. In litigation, a well-documented resolution or consent can make the difference between a dismissed claim and a prolonged court battle. Minutes are your first—and sometimes best—line of defense.
Final Word
Corporate minutes aren’t red tape—they’re part of what makes your business a legally distinct entity. Whether you’re preparing for a financing round, bringing on new investors, or just operating with best practices in mind, having clear, timely records of shareholder and director decisions is critical. At Kelleher + Holland, LLC, our Corporate Practice Group regularly helps clients implement effective internal governance practices—from preparing annual meeting minutes and board consents to reviewing bylaws and recordkeeping procedures. We also assist with minute book audits, document templates, and setting up workflows so clients can stay on top of formalities without bogging down operations. Contact us today if you’d like help formalizing your company’s processes—or simply want to make sure your records are as strong as your business.