WHAT A RESOLUTION IS?
THE TYPESIn Ghana, special resolutions and written resolutions are similar in purpose, yet different in process. Meaning that though resolutions are decisions taken by shareholders for the future of the company, medium by which they are taken varies. Hence, the kind of decision being taken and the impact that it will have on the company will determine which type of resolution is required.
The Company’s Act provide us with two type of resolutions namely Special resolutions and Ordinary Resolutions.
- A Special resolution requires that 75% of the voting members present at the meeting agree to that matter being voted on. The Act requires that a special resolution is required for instances such as …….. amending a company’s constitution, change of name increase or decrease share capital, approve large business transactions;
- Ordinary resolution is used where a simple majority of shareholders is needed to approve a change, examples of such changes include the removal of a director from office or the termination of the appointment of an auditor.
The main advantage of using written resolutions is that they offer more flexibility and convenience.
A special resolution requires a physical meeting of shareholders to be held for vote, whereas a written resolution enables shareholders to vote on matters through mail, letters, or even virtually.
It is important to ensure that the correct type of resolution is used to obtain approval.