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Aipedia: Company formation and secretarial agents
AI can turn meeting notes and recordings into minutes and resolutions, but recording an invalid decision does not make it valid. Company secretaries who rely on unchecked output risk claims from client companies and their directors.
Part of: AI in Company formation and secretarial agents
In short
Company secretarial providers use AI to transcribe board meetings, draft minutes, generate written resolutions and update statutory registers. The main risk is a document that looks complete but records a decision taken without a quorum, without the required majority or by directors with an undeclared conflict. Errors can undermine share issues, dividends or appointments and may need to be put right by ratification. The secretary owes a duty of reasonable care and skill. PI usually responds to claims from the client company or its directors, subject to the wording, but not to every cost of putting things right.
Board and shareholder paperwork is high volume and formulaic, so AI may be used for several tasks:
The tool records what it is given. It does not know whether the meeting was properly called, whether enough directors were present or whether the articles required something different.
The secretary or agent owes reasonable care and skill in providing the service, under section 13 of the Supply of Goods and Services Act 1982 for business clients. Accuracy matters because errors in AI-drafted resolutions become part of the client's public record once filed and may need rectification. No regulator has published AI guidance for this work.
In practice, the person preparing the minutes should check each decision against the company's articles and company law: notice, quorum, conflicts of interest, the type of resolution needed and, for written resolutions, who is eligible to sign. Agents within accountancy firms or law firms are also subject to their professional body's rules.
Other secretarial uses of AI are mapped in AI in company formations: rules, risks and PI.
Illustrative scenario: a secretarial provider records a short board call using an AI note-taker. The tool lists three directors as attending because a third was mentioned in the conversation, and drafts minutes approving a share allotment. In fact only two directors joined and the articles required three for a quorum. The allotment is filed. At a later investment round the investor's lawyers identify the problem, the deal is delayed and the company has to ratify the decision and correct its filings.
Other failures include written resolutions circulated to the wrong members, special resolutions drafted as ordinary resolutions, conflicts of interest left out of the minutes and registers updated with decisions that were never passed. AI note-takers also struggle to attribute statements when several people speak at once, so recorded views and declared interests need particular care. Similar issues arise with share allotments and capital changes and PSC register entries.
The client company, and sometimes its directors, may claim the cost of correcting the record, losses from a delayed transaction or lost value. PI commonly responds to claims alleging negligence in secretarial services, including defence costs, subject to the policy terms. The agent's own time spent fixing its errors is usually not covered unless the policy has a mitigation or rectification extension.
Where the same AI fault affects many clients, the aggregation clause can decide whether the claims share one limit and one excess. See company secretary PI cover and PI for company secretaries and corporate services.
These checks keep AI-drafted minutes and resolutions accurate:
Apex arranges PI for company secretarial providers. A broker reviews how your policy handles rectification costs and a series of claims arising from the same AI process.
Minutes are evidence of what happened at a meeting, however they were drafted. If the AI version is wrong, it is still wrong once signed. The chair or a director should approve the content, and the secretary should check that each decision was validly made.
Often it can be ratified or regularised, but the steps depend on the articles and the decision involved, and investors may want legal advice. The cost and delay are a common source of claims against the secretary who recorded it.
It depends on the wording. A client's claim for its own losses is commonly within PI. The agent's own cost of correcting its errors is usually not covered unless the policy includes a mitigation or rectification extension.
Yes. Directors and other attendees should know a meeting is being recorded and how the recording will be processed and stored. Recordings contain personal data and confidential business information, so agree retention periods and keep them out of public AI tools.
Tell us about your firm and the work you do. A broker will review how your current PI treats AI-assisted work, or arrange new cover. No fee for a quote. Or call 0117 325 0027.
Start a PI quote Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information about how AI is used in the profession and how insurance may respond. It is not legal, regulatory or insurance advice on your circumstances, and it does not guarantee that cover will be available or on what terms.
