From wax seals in medieval times to electronic signatures in the cloud, the way people sign agreements has always been chasing the same goal: security and trust in the deal-making itself.
A signature builds relationships on legal ground. Today, whether you're onboarding a new employee or signing a year-long vendor deal, that signature isn't optional. This guide walks through what contract signing actually involves and the best practices for taking it to execution smoothly.
Contract signing is the act of adding signatures to a contract to accept the terms and conditions it contains. It formalizes a business relationship into a legally binding agreement, and it's what gives a court something to point to if a dispute over the contract signatory's authority ever comes up.
Signing is an intentional act, proof that everyone involved consented to enter the relationship. Without a signed contract, disputes get murky fast; there's no binding proof of intent to follow the terms laid out.
If you've ever looked at a signature block reading "By: ___ Its: CEO" and wondered what that second line is doing there, it's identifying the capacity someone is signing in on behalf of the company as its CEO, not as a private individual. Without that line, a signatory could later be argued to have signed personally, potentially making them individually liable for obligations meant to bind the company.
Wet ink signatures involve signing a printed copy with a pen, then circulating it by mail or in person. Quick for face-to-face negotiation, but messy once parties are spread out.
Electronic signatures let parties sign by typing or drawing a signature on a screen. They're fast and eliminate logistics, though not universally accepted, the ESIGN Act (US), eIDAS (EU), and PIPEDA (Canada) each set their own rules. For a deeper look at the different formats, see our breakdown of types of electronic signatures.
Digital signatures are a more advanced form of e-signature using cryptographic technology to authenticate signatories and protect document integrity. Our comparison of wet ink vs. e-signatures covers the practical trade-offs between all three methods in more depth.
Also read: the ultimate guide to contract compliance.
Store it securely. 71% of companies can't locate at least 10% of their contracts, a genuinely avoidable problem with a proper repository and an audit trail tracking every access and edit.
Track obligations and performance against agreed milestones.
Manage renewals and terminations. Learn about the contract renewal process, strategy, and best practices.
Run regular audits on compliance, performance, and financial terms.
Sign the right version. Standardize your naming convention or use a CLM that auto-versions edits.
"Version control is key to contract risk management. Using old agreements is dangerous, primarily because existing agreements likely contain negotiated terms."
~Sterling Miller, CEO and Senior Counsel, Hilgers Graben PLLC
Outline every signatory's capacity in the signature block, exactly what the "Its:" line is for.
Carefully review termination and dispute resolution clauses.
Also read: managing contract terminations: the ultimate guide.
Keep an original copy of the signed agreement and all supporting documents.
Slow down. Don't sign under pressure. If verbal agreements were made earlier, get them written into the document first.
SpotDraft's e-signature tool collects legally binding signatures compliant with ESIGN, eIDAS, and ECA, with bulk signing for high-volume documents like offer letters and MSAs. Automated workflows route contracts for approval based on rules you set, and once approved, documents move to the right signatories in order automatically. Underneath all of it sits contract lifecycle management that keeps version history and audit trails intact from first draft to final signature.
Want to see how SpotDraft caters to your unique contract management needs? Request a personalized demo.
