SLID Webinar on Company Secretary in the Digital Age

The Board Secretaries Forum of The Sri Lanka Institute of Directors (SLID) together with their strategic partner – the Institute of Chartered Corporate Secretaries of Sri Lanka (ICCSSL) recently organized a webinar on “The Company Secretary in the Digital Age” to share experiences on how digital innovation is helping the Company Secretary to be more efficient and effective. The webinar was moderated by S. Sudarshan – Chair of the SLID Board Secretaries Forum and Deputy President of the ICCSL while the keynote was delivered by Nisha Najumudeen – former Company Secretary of Seylan Bank PLC. Naomal Goonawardena – Precedent partner of Nithya Partners together with Sunil G. Wijesinha – Director of BizEX Consulting (Pvt) Ltd and Chairman of many public companies were the expert panellists.

Introducing the topic, S. Sudarshan said that the Company Secretary’s work related to administrative responsibilities used to consume a significant amount of time which reduced the capability to focus on important areas such as strategy, research, problem solving, and representation and coordination of company matters. “The opening represented by technological advancements offers the opportunity to manage the ever-increasing governance challenges and compliance requirements faced by all organizations. Through digitalization I believe that the company secretary can discontinue certain traditional office work mechanisms and implement digital services. Digitalization has undoubtedly changed the way Corporate Secretaries work, both in scope and execution. As Boards go digital, corporate secretaries must work closely and ensure a seamless transition.”

In her keynote, Nisha Najumudeen said “individuals like me who began our careers in the ‘80s have seen how the work that we have been doing has evolved beyond recognition over the 3 decades due to technological development and rapid digitalization. Automation enabled me to perform my duties with ease. Technology has become pervasive, and digitalization is an indispensable element for any professional and company secretaries are no exception. In the good old days, company secretarial functions were predominantly manual, laborious, and the processes were paper based. Before the onset of lockdowns, all meetings were held physically, and forms were typed and filed with the Registrar of Companies (ROC). The availability of the eROC portal to submit forms online and automation of the share trading process of the CSE with the establishment of the CDS provided great relief for all listed entities which are some of the benefits of digitalization” and added that digital innovation should be welcomed by all stakeholders instead of being unsettled by it.

Sunil Wijesinha said “the Company Secretary in his/her role should be the champion in taking forward, encouraging, initiating, and training, making sure that these tools are used to make Board meetings and scheduling meetings and evaluations more productive. This process is also important since documentation is a critical matter, and the meeting minutes must be absolutely accurate and unambiguous” and referred to the latter in a situation of a government institution where after a change of government a Commission of Inquiry always asks whether the minutes would pass the scrutiny. He also shared his insights on the etiquettes of online meetings to make them more productive.

Naomal Goonawardena discussing the legal aspects of the new initiatives being carried out by company secretaries in relation to their functions said that there could be certain documents such as the articles or even the Companies Act which says that certain things need to be done in writing. “In such situations you would need to rely on Section 4 of the Electronic Transactions Act (ETA) which says that notwithstanding anything in any other written law, if by some chance that there is a data message or electronic document or record or other communication in electronic form, then in such a case the requirement to be in writing is complied with.” He also said that a message which is obtained in relation to what is being done in connection with an approval or something which is done at a meeting, for example a circular resolution, an electronic message which signifies the approval of various parties to that resolution is covered by Section 3 of the ETA. “For requirements to keep originals, Section 5 of the ETA says that if there is requirement in terms of any law to keep originals, those originals can be in the form of electronic documents or electronic records and that would be perfectly valid. The requirement for the retention of documents for a specified period is covered by Section 6. He also said that the ETA covers the concept of electronic signatures as well. “While there are many ways in which the assent of Directors is obtained, at the most primitive level somebody might sign a physical document and scan and send it which is acceptable. However, the more correct method is for an electronic signature to be affixed onto the document for the purpose of getting the approval and that is provided for in Section 7.” Thus, the various elements or aspects which are normally required in the course of company secretarial practice ranging from the various communications, records that are kept, written documents which are maintained, storage requirements for documentation, and how you actually prove that various people have approved resolutions can be conveniently dealt within the scope of the existing law. However, there could be practical implications of these that needs to be considered.