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As a company grows, its board of directors is routinely called on to make consequential decisions—around governance, fundraising, hiring, and major commercial arrangements, among others. The board’s role is to provide strategic oversight and formally authorize actions that materially affect the business. To do this, boards typically act through either board resolutions or written board consents. While both serve a similar purpose, they operate differently and understanding the distinction matters.
What is a Board Consent?
A board consent is a written document through which the directors formally approve a specific corporate action. For example, if the board agrees to retain a law firm for a transaction, that approval may be documented through a board consent. In most jurisdictions, board consents are used instead of holding a formal board meeting and require unanimous approval from all directors.
Board consents are especially common when timing is tight or when it is impractical to convene a meeting—such as when directors are in different locations or unavailable on short notice. The consent must be circulated to all directors and signed individually to be legally effective.
Here is an example board consent for the company Big Sky Energy Canada Ltd filed with the Securities Exchange Commission. In this case, the consent was used to elect an individual to the board of directors.
Difference Between Board Consents and Directors Resolutions
Board resolutions serve the same legal function—authorizing corporate action—but are adopted through a vote taken at a duly convened board meeting. The decision-making process is recorded in formal meeting minutes, typically prepared by the board secretary. From a legal standpoint, resolutions and written consents carry the same force; the key difference is procedural.
When Does my Company Need one?
If your company needs to approve a significant action and cannot reasonably hold a board meeting, a written board consent is often required. Common examples include:
· Issuing equity or options to employees
· Raising capital from new or existing investors
· Approving major commercial contracts (for example, high-value vendor agreements)
· Authorizing substantial investments in equipment or infrastructure
Because board consents must be signed by all directors, they are often referred to as unanimous written consents. Missing or incomplete director approvals in your minute book can create friction during future diligence—particularly during financings or acquisitions, when speed matters. If major decisions have not gone through the appropriate process, it may dissuade prospective investors from financing the company.
When drafting a board consent, it is key to include the following:
1. Title – a concise description of the action being approved
2. Background – brief context explaining why the action is being taken
3. Approval language – the specific authorization granted by the board
4. Effective date – when the approval takes effect
At Apex Corporate Law, we help founders and boards navigate these decisions with an eye toward future growth and diligence readiness. Taking the time to properly document board approvals today can save meaningful time, cost, and stress as your company scales.
