Understanding the Directors’ Resolution in Writing (DRIW)
A Directors’ Resolution in Writing, commonly referred to as a DRIW, is a document that formalises decisions made by company directors. This typically comes into play when it’s not possible to get all directors together for a physical meeting.
The company secretary must arrange for the DRIW to be filed in the company’s minute book, either as a hard copy or an electronic version. The DRIW provides a practical and efficient way to address urgent issues when directors can’t meet in person. Resolutions that don’t necessitate shareholders’ participation can be executed via a DRIW unless the company’s Memorandum and Articles of Association state otherwise.
Initiating a Directors’ Resolution in Writing
To kick-start the process, the company sends the proposed resolution text to each voting member, which can be done via email, snail mail, or the company’s website. This communication should also outline the timeline for casting votes and explain the voting process. According to the Companies Act, if a member or a group of members representing at least 5% of all voting-eligible members requests a physical meeting, the company must organise a meeting instead of proceeding with the written resolution.
Getting a Director’s Written Resolution Over the Line
Directors can vote through various methods, including sending signed hard copies, verifying via email, or acknowledging on the company’s website. A resolution is successfully passed if it gets a thumbs-up from most directors unless the company’s constitution states otherwise.
A company needs to document its passed resolutions, including DRIWs, and maintain records for ten years from the date the resolution was passed. In case of an audit, the auditors would want to peruse the dates and records of all DRIWs passed during the company’s financial year up until the date of the auditor’s report.