If you’re a smaller business owner, you may have heard about getting a company secretary. You might be thinking, “A secretary? It’s not like there’s a large amount of administrative work to be done since I’m just running a small company, right?”
While it might seem so, there are in fact a great number of tasks a company needs to perform aside from daily operations, including:
These tasks and requirements need to be fulfilled by every Malaysian company, and can be as simple as planning board meetings, to as complicated and arduous as filing annual returns.
Thankfully, a company secretary (or a co-sec) can ease this burden significantly by managing these tasks for you, allowing you to spend more time on your next big business venture instead of mulling over convoluted documents.
In fact, company secretaries are a requirement for the incorporation of any private limited company in Malaysia. So instead of sitting there and scratching your head as you struggle with documentation and administration, you might as well enlist the services of a co-sec to ease your burden.
Knowing this, you might wonder what exactly a co-sec does for you as a business owner? Well, here are some 5 responsibilities that a co-sec in Malaysia would fulfill for your company.
Managing Administrative Tasks
Managing Legal Tasks
Managing Accounting, Tax, and Auditing Tasks
Serving as an Advisor
1. Managing Administrative Tasks
The core responsibility of a company secretary is to manage a variety of administrative tasks for your company. These tasks can include:
planning and organizing board meetings
taking down meeting minutes
Essentially, your co-sec will help you with these administrative tasks which can end up eating a great deal of your time.
Furthermore, your co-sec will also follow up on meetings and will make or implement the necessary changes. While this may be rather difficult, the presence of a co-sec to assist you will definitely reduce the strain of such a task.
For instance, should your company decide to change its office address following a meeting, your company secretary would make the necessary changes to the Memorandum and Articles of Association (M&A) of your company, speeding up the process of making any changes to the administrative structure of your company.
2. Managing Legal Tasks
Arguably, one of the most important responsibilities of a company secretary is to manage the legal matters of a company to ensure compliance with various regulatory and statutory standards. To do so, a co-sec needs to:
be familiar with your company and its structure
be familiar with the company’s various portfolios
This is so that they can prepare and manage all the necessary legal documentation.
For instance, a co-sec would need to be familiar with your company’s Memorandum and Articles of Association (M&A), the legal document which details the core structure of a company, and it’s relationships with outsiders. This is so your co-sec is able to manage tasks such as:
Filing Annual Returns for your company to the SSM (Suruhanjaya Syarikat Malaysia/Companies Commission of Malaysia – a statutory body that manages incorporation of companies in Malaysia)
Ensuring all records pertaining to your company are up to date and in compliance with regulatory and statutory standards.
These records are important to maintain and keep up to date, as they contain a great deal of important information regarding your company such as the:
Addresses of the company offices
Activities of the company
Names of the company directors
Shareholders of the company, and more
Therefore, should any changes be made to the structure of the company, it is important to ensure that these records are updated to ensure that you don’t encounter any legal issues pertaining to the company’s Annual Returns.
3. Manage Accounting, Tax, and Auditing Tasks
For some, managing the company’s accounts and preparing financial statements can appear intimidating, especially for those without a background in accounting. Fret not, as a co-sec can help you with these tasks.
Essentially, a co-sec helps you:
manage and monitor the overall financial well-being of your company
assist you with filing tax returns
performing audits of your company finances
This allows you to make much better, data-driven decisions to improve your revenue, all while saving you a great deal of worry!
After all, keeping all financial documents and records organized is necessary to ensure compliance with the Malaysian Companies Act 2016, which dictates that any financial transactions that the company participates in must be put into company accounts within 60 days.
It may be difficult to juggle managing company accounts and daily business operations, so having a co-sec manage the accounting would serve to save a great deal of time and heartache for you!
4. Serving as an Intermediary for your Shareholders
Of course, managing and maintaining a good relationship with all the shareholders and stakeholders of your company is vital for success. When you enlist the services of a co-sec, they become your primary point of contact with shareholders.
Your co-sec will liaise with your shareholders on a variety of matters, such as:
providing them with information as part of due diligence
sending out important information regarding the company
making any relevant disclosures to shareholders
These tasks will be carried out in an efficient and timely manner to ensure that both the company and its shareholders are protected from any negative outcomes.
Say, for instance, your company decides to undertake a new business venture and wishes to obtain funding and support from its shareholders. Your co-sec will ensure all important information gets to them, ensuring that you keep your shareholders in the know, happy, and engaged with your company.
5. Serving an Advisory Role
A co-sec will also serve an advisory role for your company for a variety of issues such as:
administrative matters, including managing and maintaining company, record
legal matters, including keeping important documents up to date to ensure compliance with various regulatory and statutory requirements
Say, for instance, you decide to change your company name after some time. If so, your co-sec will provide advice on the entire process, and share best practices for doing so, allowing you to enact such changes with relative ease.
Also, a co-sec will also provide advice on managing and running your business, ensuring that everything is in line with the internal policies and principles of the company. As such, you can rest easy knowing that your company is running effectively, and that all your practices are up to standard.
Why are Company Secretaries important for SMEs and Start-ups?
As previously mentioned, a company secretary serves the important role of ensuring the smooth functioning of the company through managing administrative, legal, and financial tasks. So why is this important, and why particularly so for smaller companies?
Two reasons why this may be the case:
Increased efficiency in business operations
Avoiding unnecessary risk
Employing the services of a company secretary truly allows the decision-makers at the top to focus their efforts entirely on business activities. This means their attention is divided, allowing them to make better choices, which can lead to greater efficiency.
Furthermore, by ensuring that your attention is not divided, you are able to not only make better business decisions, you are also able to avoid mistakes you may have made yourself when filing certain important documentation.
Employing the service of a company secretary, who has expertise in regards to a variety of regulatory and statutory requirements for your company, will ensure that any legal or financial documentation is prepared professionally, and without error.
So why is it particularly important for smaller companies to procure such services? Two factors may come into play:
The nature of smaller companies
The structure of smaller companies
In smaller companies such as SMEs or start-ups, they tend to have a much smaller workforce than larger, more established companies. Also, they tend to need to adapt much faster to various threats and opportunities that arise in their industry to survive.
This means that there is a constant need to be focused and on your game in order to be able to face new challenges in growing your business successfully, which probably means less time to deal with administrative matters, lest you become distracted by it.
Also, since SMEs and start-ups tend to consist of smaller teams, hiring an in-house company secretary may not be the most efficient choice. However, these services ultimately still remain an important factor in ensuring success.
As such, it would be ideal for SMEs or start-ups to seek the services of external company secretaries as opposed to an in-house one. They provide the same outcomes for your business, improving your operating efficiency, and allowing you to focus entirely on growing your business.
Without a doubt, running a business is no easy feat. Between managing daily business operations and managing various administrative tasks, there is a lot on the plate for business owners, particularly those who own SMEs or start-ups.
Hence, having a company secretary, or co-sec, to assist with the various administrative, legal, and financial matters of your company can save you a great deal of time, effort, and money. A co-sec will do the following for you:
Manage administrative tasks
Manage legal matters
Manage accounting, tax, and audits
Serve as an intermediary between your company and shareholders
Serve as an advisory role
These responsibilities of a co-sec are greatly beneficial for your business. So, seeking out the right co-sec to perform these responsibilities is key. In fact, some company secretaries will even offer to cover the costs of incorporating your company for you!