Corporate records are fundamental when it comes to governance and compliance, especially for succesful organisations. Usually, the company secretary, legal team, and compliance team are in charge of this function – as corporate records are vital to protecting a company’s operations and reputation.
However, not everyone knows the key aspects of corporate records. What are corporate records, and why are they important? In fact, according to the Harris Poll, corporate records management takes about 25% of the week for senior stakeholders. It’s clearly time to go back to basics.
In this article, we’ll explore:
- What corporate records are, and what they include
- How long should corporate records be kept
- Why corporate records are important
- Legal and regulatory requirements for corporate records
What Are Corporate Records?
Corporate records are the records required to demonstrate that a corporation is functioning in accordance with the rules of the revenue service of a particular country. For South Africa, the major players are CIPC and SARS.
Put simply, corporate records serve as the official log of the company’s decisions and actions, and are a key part of entity management as well.
Corporate records must include a copy of the articles of association and company bylaws, the minutes of all shareholder and director meetings, and a stock register for keeping track of stock transactions, if applicable. The records should be held in a single, central place and easily available in the event that regulators come to audit the corporation.
Traditionally maintained as a physical record book, most corporations now maintain their corporate records digitally on a local network server and/or within a cloud-based system.
What do corporate records include?
Corporate records include the articles of association, company bylaws and other incorporation documents. They also include the policies and resolutions made and agreed upon by the board. The corporate record is not static; it is in a state of constant evaluation and growth.
Corporate resolutions can be made on many matters, including:
- Records of major transactions
- Approvals of contracts
- Records of sale or purchase of real estate
- Hiring or laying off large numbers of employees
- Expansion into a new market or a new location.
All of these decisions, and in many cases more, must be recorded by the company secretary and entered into the corporate record, alongside annual reports, corporate business and tax dealings, stock dividends and director conflict-of-interest resolutions.
Why are corporate records important?
Local regulations require corporations to maintain corporate records that prove they’re functioning appropriately. But that’s not the only reason why they’re important.
“Corporate records are the backbone of accountability and informed decision-making. Without a clear, accessible record of what’s been done and why, organisations risk repeating mistakes, losing trust and missing growth opportunities”.
Dottie Schindlinger, Executive Director of Diligent Insitute
Thorough record-keeping not only promotes compliance but also supports the company’s long-term success through:
- Liability protection: Corporate records demonstrate that it is a separate entity with its own governance processes, helping to maintain the “corporate shield” — that is, keeping the legal entity separate from its owners in terms of liabilities. This means that, for example, any creditors cannot go after shareholders’ personal assets in the event of corporate distress.
- Board effectiveness: As soon as an entity is legally incorporated in any jurisdiction, it creates a corporate record that the board can refer back to, aiding decision-making. Most jurisdictions require that an entity hold documentation such as articles of association and annual reports, hold regular board meetings, and record and minute these meetings.
- Good governance: Corporate records help show regulators this is a healthy, functioning, viable entity with well-documented governance practices. Writing the governance framework and keeping it in a centralised platform accessible to all paves the way for the broader adoption of essential practices.
- Accountability: Corporate records must be signed and recorded, and any actions taken must be backed up with documentation stored with the corporate record. This holds boards, leaders and employees at all levels accountable for the decisions and actions the record includes, supporting the company’s achievement of its strategic goals.
Legal And Regulatory Requirements
Maintaining good corporate records is good business practice, but there are also extensive regulations to consider. Different laws and regulations across different jurisdictions dictate what you must maintain, for how long and in what format. Failing to comply can result in fines, litigation or reputational damage.
By jurisdiction
South African organisations must adhere to complex regulations at the federal and state levels:
- Retention:
Companies must keep all required records (e.g. financial, governance, statutory) for at least 7 years in written or easily convertible form. - Core Records:
Must include the Memorandum of Incorporation (MOI), director and shareholder registers, minutes and resolutions, financial statements, and notices/communications to stakeholders. - Accounting Records:
Must be accurate, complete, and in an official South African language, enabling the preparation of lawful financial statements. - Storage & Access:
Records must be kept at or accessible from the registered office in South Africa, and certain stakeholders (e.g. shareholders or members) have inspection and copying rights. - Compliance & Penalties:
Failure to maintain proper records or falsifying them is an offence under the Companies Act, 2008, and may lead to CIPC enforcement or legal penalties.
Other jurisdictions
Overall, South Africa’s regulations are robust and transparency-focused, aligning closely with OECD-level standards. Countries like Canada, Australia and Japan have their own privacy and retention regulations, often blending principles from both U.S. and EU models. Multinational corporations must navigate this legal patchwork with care.
