Circulating Resolutions in Australia: Pass Decisions Without Meetings

Need to make a decision quickly without trying to wrangle everyone into a room (or yet another Zoom call)? Circulating resolutions let Australian companies pass decisions in writing, without holding a formal meeting.

Used well, they save time, reduce admin, and keep your business moving. But there are clear rules to follow around who can sign, how you document it, and when a meeting is still required.

In this guide, we’ll unpack how circulating resolutions work for both directors and shareholders, when you can use them, and the simple steps to put them into practice confidently.

What Is a Circulating Resolution?

A circulating resolution is a decision made in writing by the people who would otherwise decide it at a meeting. Instead of convening a meeting, you circulate the resolution text to the eligible decision‑makers, and they sign to approve it.

In Australia, this is commonly used by:

• Directors of a proprietary company (Pty Ltd), to pass board decisions between meetings.
• Shareholders (members) of a proprietary company, to approve certain member decisions without a general meeting.

Your company’s ability to use circulating resolutions comes from a mix of the Corporations Act 2001 (Cth) and your internal rules. In practice, two things usually control whether you can use one:

• What your Company Constitution says about resolutions without meetings (especially for directors).
• Whether the law requires a formal meeting for the particular decision.

Think of a circulating resolution as a written snapshot of a decision that would otherwise be made in a boardroom. The key is making sure it’s drafted clearly, signed correctly, and recorded properly.

When Can You Use One (And When Should You Hold a Meeting)?

Circulating resolutions are incredibly useful, but they’re not a free‑for‑all. Here’s a practical way to decide whether they fit the situation.

Good Scenarios for Circulating Resolutions

• Routine approvals (e.g. approving standard contracts, opening a bank account, appointing an accountant).
• Timing‑sensitive decisions when a meeting is impractical.
• Confirming decisions already discussed in principle.
• Matters your constitution expressly allows to be decided without a meeting (for directors).

Situations That Often Require a Meeting

• Decisions where legislation mandates a meeting (for example, certain public company member decisions).
• Matters likely to be contentious, where discussion and real‑time questions are important.
• Decisions that impact shareholder rights or major corporate actions where transparency and formal voting procedures are beneficial.

If you’re unsure whether a particular decision can be done by circulation, check your constitution and-if it’s a significant decision-get advice before you proceed. It’s also common to handle sensitive topics via a properly convened meeting (in person or virtual) even if circulation might technically be allowed.

How To Pass a Circulating Resolution (Step‑By‑Step)

Once you’ve decided a circulating resolution is appropriate, the process can be straightforward.

1) Confirm Authority and Voting Requirements

Start by confirming:

• Who is entitled to vote (all directors? all members, or only a class of shares?).
• What approval is required (simple majority, special majority, or unanimous approval).
• Whether your constitution sets any specific process for circulating resolutions (especially for directors).

For directors, your constitution or the replaceable rules often say whether a written board resolution without a meeting is valid and what threshold applies. In many companies, all directors entitled to vote must sign for a circulating board resolution to pass. Your Shareholders Agreement may also affect voting rights and decision thresholds at board and shareholder level.

For shareholders of proprietary companies, the Corporations Act requires unanimous written consent for member circulating resolutions. A constitution cannot reduce that to a majority or special threshold for written resolutions-if you want to approve by majority, you’ll need to hold a meeting and record the vote properly.

2) Draft Clear Resolution Wording

Clarity matters. The resolution should state the decision in precise, positive terms and include any approvals, delegations, or authorisations needed to implement it.

For board matters, a pre‑vetted format like a Directors Resolution Template can save time and reduce ambiguity.

3) Add Explanatory Notes (If Needed)

If the decision is complex or involves risks, attach a short background note so signers understand what they’re approving. This supports good governance and helps avoid misunderstandings later.

4) Identify the Signers and Circulate

Send the resolution to everyone entitled to vote. If you’re using e‑signing, ensure you can verify identity and capture a reliable audit trail.

Set a reasonable response deadline so everyone knows when the resolution will close. If a special majority is required (for a meeting; not applicable to proprietary member written resolutions), track votes as they come in and confirm whether the threshold has been reached.

5) Execute Properly (Electronic or Wet Ink)

Make sure the signing method is valid for the resolution and any related documents. Many decisions can be signed electronically, but some documents (for example, deeds) may require extra care around witnesses and execution formalities.

If the resolution authorises the company to enter into a contract or deed, consider how the company will sign. Using section 127 execution can give counterparties statutory comfort that documents are properly executed.

6) Record the Outcome and Lodge Where Required

Once approved, document the result and add it to your minute book or board portal. Some decisions trigger filings or notifications (for example, changes to company details or share capital). Build a habit of asking: “Does this require us to lodge anything or update our registers?”

7) Implement the Decision

Finally, carry out what the resolution authorises-sign the contract, make the appointment, issue the shares-so the decision is effective in practice.

Directors vs Shareholders: Different Rules You Must Follow

Circulating resolutions for directors and shareholders both exist, but the rules aren’t identical. Here are the practical differences to keep in mind.

Directors’ Circulating Resolutions

• Used for board‑level decisions.
• The constitution or replaceable rules usually set whether written board resolutions without a meeting are permitted and whether all directors must sign. In many proprietary companies, unanimity of all directors entitled to vote is required for a circulating board resolution.
• The resolution should confirm any delegations (e.g. authorising a director or officer to sign a contract on the company’s behalf).
• In a single‑director company, decisions can often be documented by a sole director resolution.

Shareholder (Member) Circulating Resolutions

• Used for member‑level decisions (e.g. approving certain share issues or specific constitutional actions relevant to proprietary companies).
• For proprietary companies, the Corporations Act requires unanimous written consent for member circulating resolutions. A Company Constitution cannot validly permit majority or “special resolution” thresholds for member written resolutions-if you want to pass by majority, hold a meeting.
• If a special resolution is needed, it can be achieved either by unanimous written consent (in a circulating resolution) or at a properly convened meeting with the required 75% majority and any notice/record‑keeping requirements.

Public companies are generally more constrained and often must hold member meetings. Proprietary companies enjoy more flexibility, but for members the unanimous‑consent rule for written resolutions still applies. If there’s any doubt, consider holding a formal meeting or obtaining tailored advice.

Practical Execution Tips: Electronic Signatures, Section 127 and Records

Most companies now execute documents electronically. Still, it’s important to choose the right method for the right document and maintain clean records.

Electronic vs Wet Ink

Many resolutions and contracts can be signed digitally, provided the method identifies the signer and indicates approval. Our guide to electronic signatures explains when e‑signing is suitable and when wet ink may still be safer or required (for example, some deeds or documents that need witnessing).

Company Execution and Section 127

If your circulating resolution authorises the company to enter into a contract or deed, consider how the company will be bound. Executing in accordance with section 127 can offer counterparties statutory comfort and streamline due diligence later.

Counterparts and Version Control

Circulating resolutions are often signed by different people at different times. Signing in counterparts is a simple way to collect signatures separately and compile them into one complete document. Keep a single “final” PDF on file with all signature pages attached.

Governance Habits That Help

• Use plain English so approvals are clear and unambiguous.
• Record approvals promptly and store signed copies together in your corporate records.
• Track who is entitled to vote at any time (especially when directors or shareholders change).
• Confirm signing mechanics up front-electronic, wet ink, witnesses if needed-and keep them consistent.
• Align board approvals with how the company will sign, particularly where section 127 execution is used.

Key Takeaways

• Circulating resolutions let you pass board and shareholder decisions in writing without holding a meeting-great for speed and efficiency.
• For proprietary companies, member circulating resolutions must be unanimous in writing; a constitution cannot lawfully reduce that threshold to a majority for written resolutions.
• For directors, your constitution or replaceable rules govern whether written board resolutions are allowed and whether all directors must sign-many companies require unanimity for written board resolutions.
• Follow a simple process: confirm voting rules, draft clear wording (a Directors Resolution Template helps), circulate to the right people, execute correctly, record the result, and implement the decision.
• Choose the right signing mechanics-consider section 127, electronic signatures and counterparts-so approvals are valid and enforceable.
• Some decisions still need a formal meeting or are better handled with live discussion-don’t force a circulating resolution where it doesn’t fit.
• Keep your Company Constitution and any Shareholders Agreement aligned with how you want to make decisions in practice.

If you’d like a consultation on setting up circulating resolutions for your company, you can reach us at 1800 730 617 or team@sprintlaw.com.au for a free, no‑obligations chat.