Authorized signatories: what you need to know

In any business, certain individuals have the authority to sign contracts, agreements, and other legal documents on behalf of the company.

These individuals are known as authorized signatories. But who can be an authorized signatory, and why is it important to get right?

This guide explains the role of an authorized signatory, the risks of getting it wrong, and how businesses can manage signatory authority effectively.

What is an authorized signatory?

An authorized signatory is a person given the legal authority to sign documents on behalf of a company. This can include contracts, financial agreements, regulatory filings, and other legally binding documents.

Authorization can come from:

• A company’s governing documents (e.g., articles of incorporation, bylaws)
• A board resolution granting signing authority
• A power of attorney assigning temporary or specific signing rights

Without proper authorization, a contract or agreement may not be legally binding, leaving the company exposed to risk.

Who can be an authorized signatory?

A business can designate one or more individuals as authorized signatories, depending on its structure and internal policies. These individuals often include:

• Company directors – In many jurisdictions, directors automatically have the authority to sign on behalf of the company.
• Executives – Senior leaders, such as the CEO or CFO, often have signing authority for financial and operational agreements.
• Legal representatives – General counsel or other legal officers may be granted signing authority for specific contracts.
• Finance and procurement teams – In some cases, employees in finance, procurement, or operations may have limited signing rights for day-to-day contracts, like supplier agreements.

Businesses can also authorize external parties—such as lawyers or consultants—to sign on their behalf. Read more about that in our guide to signatory authority.

Why authorized signatories matter

Assigning the right signatories ensures that contracts are legally valid and enforceable. Failing to do so can lead to:

• Contracts being invalid – If a contract is signed by someone without the proper authority, it may not hold up in court.
• Regulatory non-compliance – Many industries require specific individuals to sign off on legal or financial documents.
• Fraud and unauthorized commitments – Without clear controls, unauthorized individuals could sign contracts that create financial or legal risks.
• Operational inefficiencies – Unclear or outdated signatory rules can slow down contract approvals, delaying business deals.

Clearly defining who can sign which documents—and keeping this information up to date—helps businesses avoid these risks and agree contracts with confidence knowing they can rely on the terms in the months and years to come.

How to manage authorized signatories effectively

Imagine this: A company’s CFO has always signed off on vendor contracts. But as the business scales, more contracts land on their desk, creating bottlenecks.

To speed things up, the company allows department heads to sign agreements under a certain value. Months later, a supplier disputes a contract, arguing that the person who signed it wasn’t authorized. The finance team scrambles to check—who actually had the authority to sign that deal?

This is a common scenario. Without clear guidelines, companies risk contracts being signed by the wrong people, slowing down deals or creating legal headaches. So how can businesses get it right?

Well, there are a few things you can to do get authorized signatories under control.

1. Define signing authority clearly

A company’s internal policies should outline:

• Who has the authority to sign contracts
• What types of contracts each individual can sign (e.g., financial agreements, vendor contracts, NDAs)
• Any approval thresholds (e.g., contracts over a certain value require board approval)

This information should be documented in corporate governance documents or as a signature policy.

2. Keep signatory lists up to date

Changes in leadership, restructuring, or regulatory updates can affect who is authorized to sign contracts. If companies don’t update their signatory lists, outdated information can lead to contracts being signed by unauthorized individuals—rendering them unenforceable.

That’s why regular reviews are key. It’s best practice is to update signatory lists quarterly or whenever a leadership change occurs. Businesses should also maintain a centralized record of authorized signatories, so teams can verify approvals quickly and remove friction throughout the contract lifecycle.

3. Use digital contract tools to enforce controls

Managing signatory authority manually—through spreadsheets or email chains—leaves too much room for error. A contract management system like Juro automates this process by:

• Restricting signing permissions to authorized individuals
• Routing contracts for approval based on pre-set rules
• Keeping a full audit trail of who signed what and when

With automated workflows, businesses can ensure the right person always signs the right contract—without delays or compliance risks.

4. Educate teams on signing authority

Many contract-related mistakes happen simply because employees aren’t sure who is authorized to sign. A sales rep might assume their manager can approve a sales contract, only to find out later that legal approval was required.

To avoid this, companies should provide regular training on:

• The company’s signatory rules
• The risks of unauthorized signing
  How to check who has signing authority

It’s also worth scheduling routine reminders about this process where necessary, particularly if you have new joiners you want to make aware of the rules on signatory authority.

Regular training and clear documentation can help prevent costly mistakes, so it's worth getting ahead of.

How Juro helps businesses manage authorized signatories

Tracking and managing signing authority manually can be time-consuming and error-prone. Juro’s contract automation platform helps businesses enforce signing controls by:

• Allowing businesses to set role-based permissions for signatories
• Automating contract approvals based on pre-set rules
• Providing a searchable contract repository to track who signed what
• Integrating with eSignature tools for secure, compliant signing

With Juro, businesses can ensure that the right people sign the right contracts—reducing legal risk and keeping operations running smoothly.

Want to find out more?

Authorized signatories play a critical role in ensuring contracts are legally valid and enforceable. Without clear policies and controls, businesses risk invalid agreements, compliance breaches, and operational inefficiencies.

By defining signing authority clearly, keeping records up to date, and using contract management tools like Juro, businesses can manage signatories effectively—without unnecessary admin or risk.

{{quote1}}

Want to streamline contract approvals? Book a demo of Juro today.