Circular Resolution Template (NZ): Approve Company Decisions Without a Meeting

If you run a company in New Zealand, you’ve probably had this moment: you need to make a quick decision (open a new bank account, appoint a director, sign off year-end accounts, approve a contract), but getting everyone into a formal meeting is painful.

That’s where a circular resolution template can help. It’s one of the simplest ways for directors or shareholders to formally approve a company decision without holding a meeting - as long as you do it properly.

In this guide, we’ll break down what a circular resolution is, when you can use one, what to include, and the common mistakes that can cause real headaches later (especially if you’re audited, raising capital, selling your business, or dealing with a dispute).

Note: This article is general information for NZ companies and isn’t legal advice. The Companies Act 1993, your constitution and any shareholders’ agreement can change what’s required for a valid resolution - get advice for your situation if you’re unsure.

What Is A Circular Resolution (And Why Do Small Businesses Use Them)?

A circular resolution is a written resolution that directors or shareholders can sign to approve a company decision without having to meet in person (or even by video call).

Instead of holding a formal meeting, the resolution is “circulated” to the relevant decision-makers, and once it’s properly approved and signed, it becomes an official company record.

For many small businesses, circular resolutions are a practical tool because they:

• Save time (no scheduling delays)
• Create a clear paper trail for banks, accountants, investors and regulators
• Help you stay compliant with Companies Act requirements and good governance
• Reduce confusion by recording exactly what was approved and when

Just keep in mind: a circular resolution is still a formal legal decision. Even if it feels “quick and casual”, it can have long-term consequences for your company.

Is A Circular Resolution The Same As “Just Emailing Everyone”?

Not quite.

In practice, many companies do make decisions over email. But if you want that decision to stand up later (for example, if there’s a disagreement between shareholders, or you need to show evidence to a bank), you’ll generally want a properly drafted written resolution and clear records of approval.

Using a good circular resolution template helps you capture the decision clearly and consistently, so you’re not relying on informal messages that can be misread, lost, or challenged.

When Can You Use A Circular Resolution In NZ?

In New Zealand, circular resolutions are commonly used for:

• Director decisions (board resolutions)
• Shareholder decisions (shareholder resolutions)
• Routine approvals, especially where everyone agrees

Whether you can use a circular resolution in your situation depends on things like:

• What the Companies Act 1993 allows for that type of decision
• What your company’s constitution says (if you have one)
• Whether the decision needs to be passed as an ordinary resolution or a special resolution
• Any requirements in your shareholders’ agreement (if you have one)

If you’ve adopted a Company Constitution, it’s especially important to check it before relying on a template, because the constitution can set specific requirements around voting thresholds, notice, or how resolutions must be signed.

Directors’ Circular Resolutions

Directors often use circular resolutions to approve operational and governance decisions, such as:

• Approving a major contract or supplier arrangement
• Opening or closing bank accounts
• Approving financial statements
• Appointing or removing company officers
• Issuing shares (where the board has authority to do so)

These are typically “board-level” decisions. If you’re not sure whether something is a director decision or a shareholder decision, it’s worth getting advice early - it can be messy to unwind later.

Also note: under the Companies Act 1993, a directors’ written (circular) resolution generally needs to be signed by all directors who are entitled to vote on it, unless your constitution allows a different approval method or threshold. This is a common reason “quick” resolutions end up being invalid.

Shareholders’ Circular Resolutions

Shareholder resolutions are usually used for bigger “ownership and control” decisions, such as:

• Approving changes to share structure
• Approving major transactions (depending on the company and governance documents)
• Appointing or removing directors (in some cases)
• Approving matters reserved to shareholders under the constitution or shareholders’ agreement

If your company has a Shareholders Agreement, it may set out additional consent requirements (for example, unanimous approval for certain “reserved matters”). In that case, your circular resolution template should reflect those rules.

In many cases, shareholder written resolutions can be passed without a meeting if the required voting threshold is met (often a majority for ordinary matters and a higher threshold for special resolutions), but the exact requirement can depend on the Companies Act, the constitution and any shareholders’ agreement.

What Should A Circular Resolution Template Include?

A well-drafted circular resolution template should do more than just say “we approve X”. The goal is to create a document that is clear, enforceable, and easy for third parties to rely on.

While the exact structure can vary, most NZ circular resolutions will include the following core sections.

1. Company Details

• Full legal company name
• NZBN / company number (recommended)
• Whether it’s a directors’ or shareholders’ resolution

This might feel obvious, but it matters if you run multiple entities (which is common as businesses grow).

2. The Type Of Resolution And The Legal Basis

The document should clearly say whether it’s:

• A directors’ circular resolution (board resolution), or
• A shareholders’ circular resolution

It should also reference that the resolution is being passed as a written/circular resolution under the Companies Act and (if relevant) the company constitution.

3. The Actual Resolution Wording

This is the heart of the template. Good resolution wording is:

• Specific (what exactly is being approved?)
• Practical (who can implement it?)
• Unambiguous (no room for competing interpretations)

For example, instead of “approve new supplier contract”, you’d want something closer to:

• identifying the contract (name of counterparty, date, and version)
• approving entry into it
• authorising a director to sign it on behalf of the company

If the decision relates to signing a contract, it’s often helpful to confirm the company is using the correct signing method. (If you’re formalising agreements regularly, having consistent Contract review processes can save you problems later.)

4. Voting Threshold / Approval Requirements

The template should reflect the correct approval threshold. For example:

• Some decisions may be approved by a simple majority
• Some decisions require a higher threshold (or unanimous approval)
• Some decisions might require a “special resolution” of shareholders

This is one of the biggest “template traps”: a generic circular resolution template might not match your company’s actual governance requirements.

As a practical example, directors’ written resolutions will often need unanimous director approval (unless your constitution says otherwise), while shareholder written resolutions follow different thresholds depending on whether the matter is ordinary or special and what your governance documents require.

5. Signatures And Date

The resolution should include:

• Signature blocks for each director/shareholder required to approve
• Names (printed) and roles
• The date of signing (and ideally, the date the resolution takes effect)

Depending on how you run approvals, you may also want:

• space for witness details (only where required)
• space to note whether signing is electronic

In many cases, circular resolutions don’t need to be witnessed just because they’re resolutions - but witnessing can be relevant for certain attached documents (or where a particular signing method requires it). If you’re unsure, it’s worth checking the signing requirements for the specific document and your company’s governance rules.

6. Attachments (If Needed)

If the resolution approves a document (like a contract, term sheet, loan agreement, or constitution update), your template should allow you to attach it and refer to it properly.

This helps avoid disputes about which version was approved.

Common Mistakes With Circular Resolutions (And How To Avoid Them)

Circular resolutions are straightforward, but there are a few mistakes we see regularly - and they tend to show up at the worst times (like when you’re selling the business, raising investment, or in a disagreement with a co-founder).

Using A Generic Template That Doesn’t Match Your Company Rules

The biggest issue is assuming one circular resolution template works for every company.

Your approval process may be affected by:

• a constitution (or the lack of one)
• a shareholders’ agreement
• different classes of shares and voting rights
• reserved matters requiring specific consents

For example, if your company has investors, your Shareholders Agreement may require specific approvals even if the Companies Act would otherwise allow a simpler process.

Not Being Clear About What’s Approved

Vague wording creates problems. If your resolution says “approve finance”, what finance?

A good circular resolution should capture:

• what decision is being made
• why it’s being made (briefly)
• who is authorised to implement it
• any limits (for example, approve borrowing up to $X)

Forgetting To Keep Proper Company Records

A circular resolution is only useful if you can actually find it later.

We recommend having a consistent company records process, including:

• storing signed resolutions in a central folder (not someone’s personal inbox)
• keeping a register of key decisions
• recording the date of approval and effective date

This becomes especially important if you’re doing due diligence for a sale, funding round, or major contract.

Confusing Director Decisions With Shareholder Decisions

Some decisions are for directors to make. Some are for shareholders. Some require both.

If you accidentally approve something at the wrong level, the decision can be challengeable - and that can lead to serious delays and costs to “fix it” later.

If your company is growing and you’re starting to deal with more complex governance decisions, it can help to put proper structures in place early (for example, a tailored Company set up approach, rather than treating governance as an afterthought).

How To Use A Circular Resolution Template In Practice (Step-By-Step)

If you want a simple process your team can follow consistently, here’s a practical step-by-step approach.

Step 1: Confirm Who Needs To Approve The Decision

Before you draft anything, check:

• Is this a director decision or shareholder decision?
• Do you need a majority, a special resolution, or unanimous approval?
• Are there “reserved matters” requiring specific shareholder consent?

If you have governance documents like a constitution or shareholders’ agreement, check them first.

Step 2: Draft The Resolution Clearly (And Attach Key Documents)

Use your circular resolution template to draft clear wording, and attach any relevant documents being approved (contracts, proposals, etc.).

If the decision involves entering a new contract (like a supply agreement or service agreement), it’s often worth checking the legal risk upfront rather than “approving first and reading later”.

Step 3: Circulate The Resolution For Review

Send the resolution to the relevant directors or shareholders.

In a small business, this might be as simple as a PDF emailed for signature, or an electronic signing process (as long as it’s done properly and your records are clear).

Step 4: Collect Signatures And Confirm It’s Passed

Make sure you actually receive the required approvals.

Don’t assume silence means “yes”. Your template should make it clear that signing indicates approval.

Step 5: Store It With Your Company Records

Save the final signed version in your company records. If you have an accountant, bookkeeper, or external adviser who relies on resolutions, ensure they have access to the right version.

This becomes especially important where the resolution affects ownership (share issues or transfers). If you’re changing ownership or reallocating shares, you’ll often need additional documents (for example, a Share sale agreement or related share transfer documentation) alongside the resolution.

Key Takeaways

• A circular resolution template is a practical way to approve company decisions in New Zealand without holding a formal meeting, as long as you follow the right process.
• Circular resolutions can be used for both director decisions and shareholder decisions, but the approval threshold and requirements may differ depending on the decision, the Companies Act, and your governance documents.
• A strong circular resolution should clearly state the company details, the decision being approved, who is authorised to implement it, the required voting threshold, and include proper signature blocks and dates.
• Common mistakes include using a generic template that doesn’t match your constitution or shareholders’ agreement, vague wording, failing to store records properly, and approving matters at the wrong decision-making level.
• If your resolution relates to major transactions (contracts, borrowing, issuing shares, changing ownership), it’s worth getting tailored legal advice so the decision is properly documented and enforceable.

If you’d like help with a circular resolution template (or making sure your company decisions are properly recorded), you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.