What Is a Board Signatory?

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A board signatory is an individual who has the authority to sign agreements and contracts for an organization. These individuals are granted the authority to sign contracts and agreements through formal procedure in the company’s documents of foundation or through a resolution approved by the board. The scope of their authority and the manner in which it is limited is explicit in the resolution or document. This ensures clarity internally within the organization as well as externally with business partners about who holds the legal power to oblige the company to abide by agreements.

The term « board member » is used to describe a person who is responsible for approving major expenditures and important decisions within an organization. For example, approving the purchase of office equipment or signing an agreement with an outside vendor. They could also be charged with negotiating better pricing or terms for procurement, and they are likely to have the ability to review and modify to contractual arrangements as well.

To ensure the best results, organizations that grant such powers should carefully examine their internal procedures and share them with authorized signatories so they are armed with a complete understanding of the organization’s goals and objectives. This information allows them to make informed decisions regarding how they exercise their authority and minimizes the likelihood that they’ll take unintentional or contradictory actions. It is common for organizations to adopt dual approval or permission procedures to reduce the risk of misuse. This ensures that at least two people are able to review and approve any activity prior to them taking place.