Authorized Signatory: Who They Are, How They Are Appointed and How to Verify One

A signatory is simply the person who signs a document. An authorized signatory is the person who is permitted to sign it on behalf of an organisation — so that their signature legally binds the company rather than just themselves.

The difference sounds academic and is not. A contract signed by someone without authority can be unenforceable against the company they claimed to represent, and the individual who signed may end up personally on the hook. In day-to-day contracting, most disputes about signatures are not about whether a signature is genuine. They are about whether that particular person was allowed to give it.

This guide covers the role itself: who qualifies as an authorized signatory, how someone becomes one, how they should sign, and how to verify the signatory on the other side of the table. For the underlying concept of the power itself — its types, thresholds and how a company grants it — see our guide to signing authority.

Authorized signatory, signatory and signing authority: the difference

These three terms are used interchangeably in everyday business language, which is where much of the confusion begins. They are not the same thing.

Put simply: signing authority is what a person holds; an authorized signatory is the person holding it. A company grants signing authority; it appoints authorized signatories.

One practical consequence: authority is always tied to a specific legal entity. Someone can be an authorized signatory of a subsidiary and have no power whatsoever to bind the parent company, or vice versa. In a group structure this is the single most common source of invalid signatures.

Who can be an authorized signatory?

Authority comes from one of three sources, and it is worth knowing which one applies before relying on it.

Officers who hold authority by law

Certain roles carry the power to represent the company by virtue of the office itself, without any separate appointment. Directors of a UK limited company, the Geschäftsführer of a German GmbH, the management board of a stock corporation and officers of a US corporation generally fall into this group.

Two caveats apply even here. First, authority may be joint rather than sole — two directors may be required to sign together, and a single signature is then insufficient. Second, the company's constitutional documents can restrict what an officer may do without board or shareholder approval.

Registered agents with a defined statutory scope

Some jurisdictions provide a formal, publicly registered form of commercial authority. The clearest example is the German Prokura: a Prokurist is entered in the commercial register and may conduct almost all business of the company, with a scope defined by statute rather than by the employment contract. Because the appointment is public, a counterparty can verify it directly from the register.

The narrower German Handlungsvollmacht works differently — it is not registered, and its scope depends on what the company actually granted. See our guides to commercial power of attorney and corporate power of attorney for how these instruments are structured.

Employees authorised by delegation

Most authorized signatories in a large organisation are neither officers nor registered agents. They are employees — a head of procurement, a regional sales director, a finance manager — who have been given authority by internal delegation, typically through a signature policy, a power of attorney, or a board resolution.

This is the group where authority is most often assumed rather than verified. Delegated authority is usually limited by contract type, value, or business unit, and those limits are frequently unknown to the person signing.

How someone becomes an authorized signatory

Appointment is a deliberate act, and it should leave a document behind. Depending on the source of authority, that document is typically one of the following:

• A resolution — a board or shareholder resolution appointing the person and defining what they may sign. In groups this is often passed as a written resolution rather than in a meeting.
• A power of attorney — a signed instrument granting authority, either broadly or for a single transaction.
• A register entry — where the jurisdiction provides for it, as with the German Prokura.
• An internal signature policy — a matrix defining which roles may sign which contract types up to which value.

Whichever route applies, three details determine whether the appointment is actually usable later: which legal entity the person may bind, what scope the authority covers, and whether it is sole or joint. Appointments that omit these are the ones that cause arguments.

For the mechanics of granting authority — thresholds, approval tiers and policy design — see signing authority.

How an authorized signatory should sign

The signature block is not a formality. It is the contract's own record of who bound the company, and a well-formed one prevents most later disputes about capacity.

A complete block identifies four things:

1. The legal entity being bound — its exact registered name and legal form, not a trading name or group brand.
2. The individual's name, legibly, in addition to the signature itself.
3. The individual's position — the title in which they sign ("Director", "Prokurist", "Attorney-in-fact"), because this is what signals the basis of their authority.
4. The capacity indicator where one is customary, such as p.p. or the German ppa. for signing by procuration.

A block that reads only as an illegible signature over a company logo tells a future reader nothing. If the agreement is later challenged, the question "who signed this, and in what capacity?" should be answerable from the document alone.

Where two signatures are required because authority is joint, both must appear — a second signature added later, or a countersignature by someone without authority, does not cure the gap. For the mechanics of signing in someone else's name, including p.p. conventions and the liability that attaches, see signing on behalf of someone.

How to prove you are an authorized signatory

Counterparties increasingly ask for evidence, particularly in regulated sectors and in high-value deals. What satisfies them depends on the source of your authority:

• Officers — a current extract from the commercial register or companies register, showing the appointment and whether representation is sole or joint.
• Registered agents — the same register extract, which will show the Prokura.
• Delegated employees — a copy of the power of attorney or an extract from the signature policy, sometimes accompanied by a certificate of incumbency or an officer's confirmation.

Two points are worth planning for. Evidence must be current — a register extract from two years ago proves nothing about today, and many counterparties will specify a maximum age. And evidence should travel with the contract, stored alongside it rather than in a separate folder, so that the file remains self-explanatory during an audit or a dispute years later.

Verifying the other side's authorized signatory

The reverse check is the one most often skipped, and it is the one that protects you. If the person signing for your counterparty lacked authority, it is your agreement that may prove unenforceable.

A proportionate check has four steps:

1. Confirm the entity. Make sure the party named in the contract is the entity you intend to contract with — in a group, the operating subsidiary and the holding company are different counterparties with different balance sheets.
2. Check the public register. For officers and registered agents, the register tells you both who may represent the entity and whether representation is joint.
3. Ask for the instrument. Where the signer is a delegated employee, request the power of attorney or an authority confirmation. A counterparty that cannot produce one is telling you something.
4. Add a warranty. Include a clause in which each party warrants that its signatory is duly authorised. This does not make an unauthorised signature valid, but it establishes reliance and shifts the consequences.

Scale the effort to the risk. A recurring low-value order does not need a register extract; a multi-year framework agreement or anything involving a newly formed entity does.

Common mistakes

• Treating authority as a property of the group. It attaches to a single legal entity. Signing "on behalf of the group" binds nobody.
• Relying on job titles. A "Vice President of Sales" may have no authority to sign at all, while an unglamorous title may carry broad delegated power.
• Missing the joint-signature requirement. Where two signatures are required, one is not a partial signature — it is no valid signature.
• Using an outdated signature policy. People change roles; delegations survive them in the document long after they should have lapsed.
• Not recording who may sign for each entity. Where no current list exists, every contract becomes an individual investigation. Maintaining signatories as structured entity data — alongside registered address, legal form and register details — is exactly what legal entity management is for.

Frequently Asked Questions

What is an authorized signatory?

An authorized signatory is a person who has been permitted to sign documents on behalf of an organisation, so that their signature legally binds that organisation rather than them personally. The authority may come from the office they hold (such as a director or managing director), from a registered appointment such as a German Prokura, or from a delegation such as a power of attorney or an internal signature policy.

What is the difference between a signatory and an authorized signatory?

A signatory is anyone who signs a document, including a private individual signing for themselves or a witness. An authorized signatory signs for an organisation and has been granted the power to bind it. Every authorized signatory is a signatory; the reverse is not true.

What is the difference between an authorized signatory and signing authority?

Signing authority is the power — its scope, its value thresholds and its limits. An authorized signatory is the person who holds that power. A company grants signing authority and appoints authorized signatories to exercise it.

Who is an authorized signatory in a company?

Typically the company's officers by virtue of their office (directors, managing directors, board members), any registered commercial agents such as a Prokurist, and employees who have been delegated authority through a power of attorney or a signature policy. The exact list depends on the company's legal form, its constitutional documents and its internal delegation rules — and it applies per legal entity, not per group.

How do you prove you are an authorized signatory?

With a current extract from the commercial or companies register if your authority comes from your office or from a registered appointment, or with a copy of the power of attorney or signature policy if it was delegated. Counterparties often require the evidence to be recent, so check whether a maximum age is specified.

What is the correct signature block for an authorized signatory?

It should identify the exact registered name of the legal entity being bound, the individual's printed name alongside their signature, the position in which they sign, and any customary capacity indicator such as p.p. Where authority is joint, both required signatures must appear on the document.

What happens if a contract is signed by someone without authority?

The agreement may not bind the company that person claimed to represent, and depending on the jurisdiction it may be void, voidable, or left pending until the company ratifies it. The individual who signed can face personal liability. Companies can reduce the exposure by verifying the other side's signatory before signing and including a warranty of authority in the contract.