Board paper annotations and directors’ notes: To keep or not to keep, that is the question...

21 February 2013

The introduction of electronic board papers into the boardroom is an excellent time to reconsider your policies around the destruction of physical and electronic board paper annotations and directors’ notes.

The risks of retaining board paper annotations and notes outweigh the benefits. They should be destroyed after the meeting at which the minutes they relate to are approved or tabled, except in circumstances where there is existing, potential or anticipated litigation that the annotations and notes may be relevant to, in which case they will need to be retained. This shift in practice requires that directors pay closer attention to board minutes to ensure they adequately reflect board deliberations.


Many directors retain their annotations and notes as evidence of the discharge of their duties should the need arise.  Annotations and notes may be helpful to show a director adequately informed themselves, appropriately questioned and considered issues and exercised due care and diligence. Annotations and notes could support both the company and a director’s position on an issue in contention with the regulator or a third party.

However, the retention of annotations and notes also carries risk for both the company and its directors.

  1. Annotations and notes often reflect a director’s initial thoughts, formed prior to and without the benefit of discussion at a board meeting.  The director’s final position could be different once they have had the benefit of discussion with board members and senior management.
  2. They are likely to be incomplete thoughts, could be inconsistent with other records (such as the meeting minutes to which they relate) and may be ambiguous.  They are likely to be used by regulatory authorities or in litigation where they support their view and are unfavourable to the company and/or directors because they are either inconsistent with written records or support an interpretation of written records contrary to the view of events held by the company and/or its directors.
  3. They may be lost, misplaced or stolen which could result in a loss of confidentiality of the company’s sensitive information.
  4. Annotations and notes are owned by the director that penned them, unless agreed otherwise.[1]  The company has no right of access to them unless the director agrees.  It is difficult for a company and all directors to be fully advised early in any potential allegation of wrongdoing in circumstances where they cannot access annotations and notes that may be relevant.

These risks are not limited to hard copy annotations and notes; they apply equally to records retained on a director’s computer or tablet. 


Although current practice in relation to the destruction of annotations and notes is mixed, increasingly companies are adopting policies that require their destruction.

Changes being implemented by companies include adopting a policy that requires notes and annotations to be deleted from directors’ tablets and physical copies destroyed once the minutes to which the annotations and notes relate are tabled and/or approved (unless they need to be retained for existing, potential or anticipated litigation purposes)[2].

Some companies are introducing a standing agenda item for each board meeting so that, once the minutes of the previous board meeting have been tabled and/or approved, each director deletes or destroys (and confirms they have deleted or destroyed) all annotations and notes they have relating to the previous board meeting.

The shift in practice towards the destruction of annotations and notes has coincided with directors paying closer attention to board minutes to ensure they adequately reflect board deliberations. 

Corporate practice in relation to the detail contained in board minutes has continued to evolve.  Historically, many companies’ minutes were a bare skeleton of what occurred at a board meeting, only recording the resolutions passed.  Minutes now generally set out the reports considered, inputs received, a summary of the reasons for the decision taken and the decision taken. 

Board minutes are the best evidence of the deliberations that occur at a board meeting; they are a contemporaneous record of what occurred, agreed to by all directors.  Where minutes are not placed in the company register within one month,[3] and therefore do not have the statutory presumption of accuracy,[4] a court will still place substantial weight on the minutes as evidence of the events that occurred at the meeting, even if they are contrary to the directors’ recollections.[5]

If a director is concerned about a particular matter, they should raise those concerns at a board meeting and ensure this is reflected in the minutes, rather than retain annotations and notes.

Companies are revisiting their Deeds of Indemnity and Access.  Some companies are amending them to ensure annotations or notes are the property of the company, with directors having a right of access to annotations or notes (to the extent they may still exist) in the same way they have access to board papers.  In any case, if annotations and notes exist, the company should be entitled to access them in the same way directors are entitled to access a company’s records. 



Pay close attention to the content of board minutes to ensure they adequately reflect board deliberations and decisions.


Promptly draft and circulate minutes to directors for approval.


Destroy annotations and notes once the minutes to which they relate have been approved and/or tabled at a board meeting, unless there is existing, potential or anticipated litigation that the annotations or directors notes may be relevant to, in which case these documents must be retained.


Revisit your board charter. The company’s policy in relation to the retention or destruction of annotations and notes should be documented.


Revisit your Deed of Indemnity and Access. The company should have the right to access a director’s annotations and notes.

If you are interested in receiving a copy of our private briefing paper “The art and science of company minutes” please contact either Stephanie Daveson or Cameron Webster.

  [1]Kriewaldt v Independent Direction Ltd (1995) 14 ACLC 73.  If company owned tablets are provided to directors on which they access board papers and make notes, they may be required to sign an IT policy which provides that any information on the tablet remains the property of the company.

  [2] The destruction of any such documents will attract the sanction of the court where that destruction amounts to an attempt to pervert the course of justice or contempt of court.  See British Tobacco Australia Services Ltd v Cowell (2002) 7 VR 524.

  [3] Section 251A(1) of the Corporations Act 2001 (Cth) (Corporations Act).

  [4] Section 251(6) of the Corporations Act.

  [5] See ASIC v Hellicar [2012] HCA 17 at 138. 

The content of this publication is for reference purposes only. It is current at the date of publication. This content does not constitute legal advice and should not be relied upon as such. Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.

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