Circular Resolution Template: Approve Decisions Without A Meeting

Running a company means making timely decisions. But getting directors together for a formal board meeting isn’t always practical - especially if you’re moving quickly or your board is spread across locations.

That’s where a circular resolution comes in. It’s a written resolution your directors can approve without holding a meeting, so you can keep business moving while staying compliant with Australian company law.

In this guide, we’ll explain what a circular resolution is, when to use one, what it must include, and provide a practical circular resolution template you can tailor for your company. We’ll also cover approval and signing rules (including e-signatures), common mistakes, and the key governance documents that support your process.

What Is A Circular Resolution?

A circular resolution (sometimes called a written resolution of directors) is a formal decision made in writing and approved by the directors without calling a board meeting.

For proprietary companies in Australia, the Corporations Act 2001 (Cth) allows directors to pass a resolution without a meeting if all directors entitled to vote on the resolution sign a document stating they are in favour of it. Your Company Constitution may also set out additional or alternative rules, so it’s important to check it first.

Circular resolutions are commonly used for routine or time-sensitive decisions where a meeting isn’t needed. They don’t relax governance standards - they simply replace the meeting with a written, unanimous approval process.

When Should You Use A Circular Resolution?

Not every decision should be made by circular resolution, but many can be. Typical use cases include:

• Approving routine contracts or business-as-usual decisions that don’t require debate.
• Authorising bank signatories, opening accounts, or implementing a policy already discussed by the board.
• Issuing shares within pre-agreed parameters, or recording minor changes that must be formally noted by the board.
• Appointing a director to fill a casual vacancy (if permitted by your constitution).
• Approving documents for execution by the company (subject to signing rules - more on this below).

On the other hand, you’ll usually call a meeting for complex or contentious decisions, strategic shifts, or matters where directors should actively discuss risks and alternatives.

If your company has only one director, you may use a sole director approval process. If that’s you, it’s worth understanding how a sole director resolution works in practice.

How To Draft A Circular Resolution (With Template)

A clear, well-structured circular resolution keeps your governance tidy and reduces back-and-forth. Below are the key elements to include, followed by a practical template you can adapt.

What To Include

• Company details: Full legal name and ACN so there’s no ambiguity.
• Title and date: “Circular Resolution of the Directors” plus the date the resolution is circulated.
• Background (optional): Short context or recitals so the decision sits in its proper commercial background.
• The resolutions: Draft as numbered items, each starting with “That…”. Make them precise, action-focused and measurable.
• Approvals required: Confirm unanimous approval is required (unless your constitution provides another method).
• Deadline: A cut-off date/time for returning signed approvals to keep things moving.
• Attachments: Reference any document being approved (e.g. draft agreement, policy) and attach it.
• Execution block: Signature blocks for each director, with name, capacity and date.
• Notes on conflicts: If any director has a material personal interest, deal with disclosure and voting exclusions in line with your constitution and the Act.

Circular Resolution Template (Directors)

Use this as a starting point and tailor it to your company’s needs and constitution. If you need a ready-to-use format, Sprintlaw can provide a customised Directors Resolution Template.

 ACN 
CIRCULAR RESOLUTION OF THE DIRECTORS
Date: 

Background
A. The Company proposes to .
B. The Directors wish to consider and, if thought fit, approve the matters set out below without holding a meeting.

Resolutions
1. That the Company approve .
2. That  is authorised to finalise, sign and deliver any documents necessary or desirable to give effect to the above resolution, with any non-material amendments they consider appropriate.
3. That the Company approve .

Approval
Each Director entitled to vote on this resolution states that they are in favour of the resolutions set out above. This resolution may be executed in counterparts and by electronic signature.

Deadline
Please return your signed approval to  by  on .

Attachments
Attachment 1 -  (draft)
Attachment 2 - 

Execution
Signed by the following Directors:

__________________________________
Name:
Date:

__________________________________
Name:
Date:

__________________________________
Name:
Date:

Tip: Keep the language clear and specific. If you’re approving a contract, identify the counterparty, version/date of the draft, and attach it to avoid doubt about what was approved.

Approving And Signing: What Are The Rules?

There are two key questions here: who must approve, and how can the resolution be signed.

Do All Directors Need To Approve?

For proprietary companies, the default rule is that all directors entitled to vote on the resolution must sign the document for it to pass. Your constitution might modify this (for example, allowing a majority approval by circulation), so check it before circulating the resolution.

If a director has a material personal interest in the matter, your constitution and the Act may exclude them from voting. Handle the conflict according to your internal rules, and still aim for unanimity among those entitled to vote.

Can We Sign Electronically?

Yes - in most cases, directors can sign circular resolutions electronically. Australian law recognises electronic signatures for most company documents if certain reliability criteria are met. It’s also sensible to confirm in your constitution that electronic signatures and counterparts are acceptable.

For documents being executed by the company itself (as opposed to directors approving a resolution), there are additional rules. If you’re executing a document under the Corporations Act’s execution provisions, it’s worth revisiting how signing under section 127 works, and the differences between wet ink vs electronic signatures in Australia.

When collecting signatures from multiple directors, it’s common to allow signing in parts. If you do, add a line confirming the resolution may be “signed in counterparts” and treated as one document. For more on this, see signed in counterpart best practices.

What About Member (Shareholder) Approvals?

Some decisions must be made by shareholders rather than directors (for example, changes to share capital, replacing the constitution, or major corporate actions). In those cases, you may need to convene a meeting or, where permitted, seek a written resolution of members. If the matter is urgent or significant, calling an Extraordinary General Meeting (EGM) may be required.

A well-drafted Shareholders Agreement can also set out how members make decisions outside of meetings, and whether unanimous or majority consent is needed for specific matters.

Compliance Tips And Common Mistakes To Avoid

Circular resolutions are powerful - but they must be done correctly to be valid and effective. Here are the top issues we see, and how to avoid them.

1) Not Checking Your Constitution

Your constitution governs how directors pass resolutions without a meeting, who can vote, quorum-equivalent requirements (if any), and whether majority or unanimous approval is needed. Make sure your process aligns with these rules. If your constitution doesn’t reflect how your board operates, consider updating your Company Constitution so it supports your decision-making style.

2) Missing Unanimous Consent (When Required)

For many Australian proprietary companies, every director entitled to vote must approve a circular resolution. If one director hasn’t signed, the resolution may be invalid. Track responses and follow up before relying on the decision.

3) Ignoring Conflicts Of Interest

If a director has a material personal interest in the matter, ensure they disclose it and follow the voting restrictions in your constitution. Capture the disclosure in the wording or accompanying notes for your records.

4) Vague Wording Or Missing Attachments

Resolutions should be specific. If you’re approving a contract, attach the exact version being approved. If you’re delegating authority, state who holds the authority, what they can sign, and any limits (e.g. dollar thresholds).

5) Execution Gaps

Approving a transaction is separate from executing documents. Once a circular resolution is passed, confirm whether the company will execute the document under section 127 or by authorised agents. For execution, revisit the rules on legal requirements for signing documents and ensure you’re using the right method for the specific document type.

6) Poor Record-Keeping

File the fully executed circular resolution (and attachments) in your minute book. Many boards use a central board portal or shared drive with controlled access. Good records make it easy to demonstrate compliance to auditors, investors and regulators.

7) Using Circular Resolutions For The Wrong Decisions

Complex, high-risk or contentious matters deserve a discussion. Use circular resolutions for straightforward items, and schedule a board meeting when the board needs to debate options, test assumptions or consider alternatives.

Governance Docs That Support Circular Resolutions

Strong governance is about more than a single template. The following documents and policies help your directors make quick, compliant decisions throughout the year.

• Company Constitution: Sets the rules for board decisions, circular resolutions, director appointments, quorum and conflicts. If yours is outdated or silent on key points, consider updating your Company Constitution.
• Board Delegations/Authorities Matrix: Defines who can approve what, and at what dollar thresholds. This often sits alongside the circular resolution process to keep sign-offs clear.
• Directors Resolution Template: A consistent format for written approvals reduces errors and speeds up execution. If you want a customisable document, see Sprintlaw’s Directors Resolution Template.
• Shareholders Agreement: Clarifies when member approvals are needed, voting thresholds and reserved matters. A well-structured Shareholders Agreement complements your board processes.
• Execution Policy: Explains when to use section 127 execution, who can sign on behalf of the company, how to handle electronic signatures, and whether to allow counterparts. Cross-reference with your processes for wet ink vs electronic signatures and signing in counterpart.
• Minute-Keeping Policy: Sets standards for filing and retaining circular resolutions, attachments and related approvals in your minute book.

These documents work together to make decision-making quick, transparent and audit-ready - which is exactly what investors and regulators expect as you grow.

Step-By-Step: Running A Circular Resolution Process

Here’s a practical workflow you can adopt or adapt:

1. Check your rules: Confirm your constitution allows written resolutions, whether unanimous consent is required, and whether any director has a conflict.
2. Prepare the draft: Fill out the circular resolution template with clear, specific wording. Attach any documents being approved.
3. Set a deadline: Give directors a reasonable period to review and sign. For urgent matters, make that clear in the cover email.
4. Circulate for approval: Send via a secure channel. Make it easy to sign (e.g. approved e-signing platform) and include instructions.
5. Track responses: Follow up with any directors who haven’t responded. Remember, in many proprietary companies, all voting directors must sign.
6. Confirm outcome: Once validly approved, notify relevant stakeholders (e.g. management team) and proceed with any next steps (like document execution under the right signing process).
7. Recordkeeping: File the signed resolution and attachments in your minute book or board portal.

If you’re frequently passing circular resolutions, consider establishing a board calendar and decision register. This creates visibility over what’s been approved, what’s pending, and what must go to members.

Frequently Asked Questions

Can we modify the wording once some directors have signed?

If you change the substance of a resolution after any director has signed, you’ll generally need to recirculate the updated version and obtain fresh signatures from all voting directors. To avoid delays, circulate a clear draft and invite comments before finalising for signature.

Do we need a witness when directors sign?

Directors generally don’t need a witness to sign a circular resolution. Witnessing is more relevant to specific document types (like deeds) or where required by internal policy. If you’re executing a document as a deed, revisit your execution method and requirements for signing documents in Australia.

What if a director is on leave or unreachable?

Check your constitution for alternates or leave of absence provisions. If unanimous approval is required and a director cannot vote, consider whether the matter can wait for a meeting or whether the constitution provides a workaround (such as a majority by circulation). When in doubt, convene a short meeting instead.

Can shareholders pass a circular resolution?

Sometimes. It depends on the decision type and your constitution (and for some matters, the Corporations Act). For significant actions, an EGM may be required. Your Shareholders Agreement can also set rules for written member approvals.

Key Takeaways

• A circular resolution lets your board approve decisions in writing without calling a meeting - ideal for routine or time-sensitive matters.
• Check your Company Constitution before circulating a resolution, including whether unanimous consent is required and any conflict rules.
• Draft resolutions with clear, specific wording and attach the exact documents being approved to avoid ambiguity.
• Make sure approvals and signatures comply with Australian rules on electronic execution, section 127 execution (when relevant), and signing in counterparts.
• File signed resolutions in your minute book and maintain a consistent process supported by governance documents like an execution policy and delegations.
• Some decisions belong to shareholders - plan ahead with a strong Shareholders Agreement and be ready to call an EGM when necessary.

If you’d like a consultation or a customised circular resolution template for your Australian company, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no-obligations chat.