A corporate resolution is a formal record of approval for company action by a board, shareholders, members, or other authorized decision-maker.
Why a corporate resolution matters
A corporate resolution matters because banks, counterparties, investors, and courts may need proof that a company action was properly authorized. Resolutions can approve contracts, loans, officers, stock issuances, mergers, asset sales, or litigation decisions.
They help connect internal governance to external legal authority.
Where a corporate resolution appears
Corporate resolutions appear in board minutes, bank account openings, loan closings, asset sales, stock issuances, merger approvals, officer appointments, and due diligence.
Practical example
A board adopts a resolution authorizing the CEO to sign a loan agreement for the corporation. The lender may request the resolution before closing.
How a corporate resolution differs from nearby terms
A corporate resolution differs from bylaws because bylaws set governance rules, while a resolution records a specific authorized action. It differs from a contract because the resolution authorizes the company to enter the contract.
Related terms
Quick knowledge check
Why might a lender ask for a corporate resolution before accepting a signed loan agreement?