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What Is A Company Seal and Do I Need One?

Company seal

A company seal is an emblem or stamp representing your business identity. It typically displays your company name and incorporation details and would typically be used to seal important documents or authenticate them as original. 

Not every business needs a company seal as The Companies Act 2006 removed the requirements for companies to have a common seal in the UK. It is now completely optional if a company wants to use one or not. 

Read on for more information about company seals including where they originated from, the pros and cons of using them, and situations where they are commonly found. 

An Overview Of Company Seals 

Seals originated from wax emblems on letters to prove they came from the stated sender. The Companies Act 1985 originally required a seal to be used on certain corporate documents like certificates but The Companies Act 2006 removed this requirement so they are now an optional tool. 

Signatures of directors and company secretaries can be used instead of a seal but some organisations may still like to use a seal on things like share certificates as it has a ceremonial, traditional and official aura about it which some may like. 

The only exception to this rule is when companies are incorporated by Royal Charter as they may still need seals depending on their specific charter rules. 

What is a Company Seal?

A company seal is a formal mark and branding that represents an incorporated business. It visibly displays your legal business name, incorporation date, and state on a device for imprinting documents. 

Think of it as an official stamp that authenticates that a specific company has created or approved documents by using this symbol of corporate identity. 

Common types of company seals include:

  • Embosser – A handheld clamp using pressure to leave raised or indented text on paper.
  • Rubber stamp – Ink-based stamp leaving an imprint on surfaces.
  • Electronic seal – Digital image applied and verified electronically.

Seals traditionally displayed unique imagery like the founder’s coat of arms. Today most just showcase standard text information covering the details above. 

When are Company Seals Used?

Even though optional, a company seal may still be used and when it is, it can offer the following validations: 

  • Demonstrate Authority – Seals visibly signify a document was issued and authorised by your company.
  • Add Weight – The formality of a seal lends gravity and legal emphasis to documents like contracts.
  • Verify Signers – Matching a seal’s company name with a document signer proves they represent that entity.
  • Show Continuity – Placing the same seal on documents over decades affirms they come from your unchanging business.
  • Prove Authenticity – Seals make documents harder to alter and prove your company endorsed the original.

Specific examples where seals commonly apply or add value:

  • Contracts and Agreements – Seals affirm your company’s entry and agreement to contracts.
  • Deeds and Real Estate Documents – Seals establish property transactions conducted by your business.
  • Stock Certificates – Seals verify shares were issued by your company.
  • Diplomas and Certifications – Seals mark documents authorised by your organisation as official.
  • Policies and Announcements – Seals demonstrate corporate approval.

Your corporate lawyer can advise where seals carry weight on documents requiring high veracity. Even if not legally mandatory, they signal legitimacy.

Modern Company Seal Use Cases

Despite their traditional associations, company seals can be adapted to modern business settings, even if they’re no longer used in an official capacity. A company seal can help with online verification, securing contracts, creating a brand impact, ceremonial uses, creating corporate gifts and authenticating products. 

Online Verification and Contract Security 

Digital company seals can be integrated easily into online transactions, e-signatures, and document workflows. Modern seal solutions provide electronic verification and legal compliance.

Some legal firms still use embosser seals on important client agreements and filings to prove their authenticity. 

Branding Impact

Sometimes a seal can be used as a branding tool. If you work in a traditional industry or service area, a unique seal can serve as part of your brand identity. Using it across company documents, like policies, letters or products, could help to create a strong brand identity. The seal could be made from graphics, your logo, numbers, or other patterns. 

Corporate Gifts

Similarly to branding uses, incorporating a company seal onto corporate gifts can elevate them into keepsakes for clients, employees and partners. Including your seal on stationery, awards, and other corporate gifts can create a lovely memento. 

Product Authentication

Seals deter counterfeits. Luxury brands emboss seals on items like handbags or etch them into glass or metals to verify genuineness.

Ceremonial Uses

Many people will have seen seals used in schools, universities and non-profits for diplomas, medals and certificates for formal occasions and ceremonies.  A company seal builds on this traditional use and can be used to add gravitas and importance to documents via branding. 

Should My Small Business Get a Seal?

Despite being an optional tradition now, many companies still choose to create and use a company seal. 

The customised design of an embossed seal or unique stamp helps to foster professional brand identity and quality associations for your business. Even if partners know seals are not obligatory, their heritage and perceived legitimacy can create gravitas in client relationships and contracts.

Seals also offer security benefits. Integrating a glossy embosser seal or subtle watermark makes documents harder to alter or forge compared to just signatures. This protects if disputes ever arise. Having seals available also maintains future flexibility if your business requirements change.

The cost of basic printed stamps or self-inking seals runs under £50, while high-end embossed versions may cost £80-£200. This is very affordable considering a quality seal could last for decades and become part of your visual identity. Even small businesses can benefit from that longevity.

Seals provide suitable pomp for ceremonial occasions like awarding diplomas or recognition gifts to employees, partners or schools. The sense of honour they impart improves the corporate image.

So while optional, company seals remain a custom with enough symbolic and practical benefits to deserve consideration by UK small business owners too. It’s entirely up to you as a business owner if you want to invest in a company seal and use it in your day-to-day operations. 

Alternatives to Traditional Company Seals

If seals are out, what alternatives are there for a modern company approach? Secure digital signatures, holograms, watermarks and rubber stamps are all options to consider. 

The following options provide the same benefits but without the formality of an official seal. They are also easy to create and use across your important documents. 

  • Properly implemented digital signatures with encryption are very difficult to duplicate or alter, providing authenticity. There are plenty of online software providers that offer this service. 
  • Watermarks, both physical on paper and digital watermarks layered under document text, are another option. The embedded branding makes documents harder to modify and forge. Watermarks are a great way to create custom designs at lower costs than seals.
  • Holographic strips or hologram stickers with unique intricate graphics also increase document security against copying. The visual complexity of quality holograms makes them challenging to recreate and therefore ideal for organisations that require ways to stamp their authenticity without fear of imitation such as passport control, driving licences or HMRC’s official documents.  
  • Matching company letterhead designs on all documentation can sufficiently signal formal agreements and letters come directly from your business, without needing a seal.
  • For more casual needs, standard rubber stamps with your business’s logo or name can quickly authenticate document origins at a very low cost.
  • Even just an embosser that indents your company name without an intricate seal mark provides light validation and protection against edits.

So, if you like the idea of a traditional company seal but want to create a more modern version, there are plenty of options to choose from. 

Should You Add a Seal to Your Corporate Documents?

Here are key questions to consider when deciding if your business needs a company seal:

Do I regularly sign high-value contracts?

  • Seals strengthen contractual agreements, so frequent complex deals may justify the cost.

Do I want to project tradition and establish deeper business credibility?

  • Seals communicate maturity and heritage if those resonate with your brand image and clients you may want to add a seal. 

Am I concerned about counterfeiting or forgery risks?

  • Seals help secure sensitive documents from tampering, copying and fraud so if this is likely to impact your business operations, then you may want to all a seal or modern version to your operations. 

Is my business large enough to have frequent ceremonial uses?

  • Organisations with lots of milestone events, awards or diplomas get the most impact by embossing them. If you think that you could regularly use a seal, go ahead and create one! 

Do I have the budget for an embosser or unique custom stamp?

  • Basic seals are inexpensive but high-quality embossed versions cost over £100. If you like the benefits that a seal can offer and can afford to get one created, you may want to buy one. 

Best Practices for Using a Company Seal

Company seals should be embedded thoughtfully into business workflows for maximum security:

  • Restrict seal access solely to authorised officers to prevent misuse. Seals carry legal weight so they shouldn’t be used in an ad-hoc and frivolous way. 
  • Keep physical seal devices like embossers locked away when not actively being used to seal documents. Having these items on display could increase the chance of them being stolen, lost or damaged. 
  • If you have sealed documents to send, these should be sent securely to their destination using tamper-proof envelopes and recorded delivery services. 
  • Include seal protocols and ethics as part of employee data security and compliance training. 
  • Standardise seal placement in identical locations on documents to make verification quicker through familiarity.
  • Utilise seals as one layer of defence via redundancies like paper watermarks, copies, digital backups, access controls, and auditing.
  • Promptly replace compromised seals and communicate the reasons behind the replacement to avoid doubts about validity. Using a damaged or expired seal can undermine the trust they seek to create in the first place. 

The tips above allow for training, controls and easy integration of seals into your business practices. 

A Brief History of Company Seals

The origins of company seals are traced back centuries as marks of authentication and identity. In mediaeval Europe, wax seals embossed with signet rings were used to approve documents and letters. The intricate signet designs verified the source, as forgeries were difficult. 

As businesses formalised, they adapted this tradition of using unique seals to certify participation in agreements. Early seals incorporated founders’ crests and symbols alongside names.

Wax and signet sealing remained common through the 18th century for documents and contracts. But as activity grew, embossers and rubber stamps increased efficiency for mass seal imprinting.

In the modern era, digital seals helped secure electronic documents as well. Despite evolving formats, the core function persists – establishing an agreement’s consented parties through official company marks. 

The ceremonial seal endures as a tradition signifying participation, approval, and identity from ancient history to current business contexts.

Final Thoughts on Company Seals

Company seals were once a traditional way to signify the authenticity of the origin of important documents both in a personal and business capacity. Historically made from melted wax, these days a modern company seal could take the form of a digital signature, hologram or watermark. 

Whilst not a legal requirement some people still value the traditional feeling of a company seal, especially in situations that require gravitas and legitimacy like University degrees, Property Deeds, and Company Registration Documents. They can also make nice additions to corporate gifts and keepsakes. 

There are no rules governing the use of company seals, so each business owner can decide if and when they want to make use of one. 

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