Board of Directors

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Board of Directors

A group of people comprising the governing body of a corporation.

The shareholders of a corporation hold an election to choose people who have been nominated to direct or manage the corporation as a board. In the past nearly all states required that at least three directors run a corporation. The laws have changed, however, since many corporations have only one or two shareholders and therefore require only one or two directors to serve on the board.

Directors are elected at the first annual meeting of shareholders and at each successive annual meeting for one-year terms, unless they are divided into classes. In a corporation that divides its directors into classes, called a classified board, conditions are often imposed concerning the minimum size of the board, the minimum number of directors to be elected annually, and the maximum number of classes or maximum terms. The purpose of a classified board, which is expressly permitted by most statutes, is to make takeover attempts more difficult by staggering the terms of the directors.

Removal of a director during the course of his or her term may occur for cause by shareholders or by the board itself if there is a provision in the bylaws or articles of incorporation that confers such power upon them. The removal of a director for cause is reviewable by a court. Many jurisdictions have put into effect statutes that concern the removal of directors with or without cause.

The functions of directors involve a fiduciary duty to the corporation. Directors are in control of others' property and their powers are derived primarily from statute.

Directors are responsible for determining and executing corporate policy. For example, they make decisions regarding supervision of the entire enterprise and regarding products and services.

Liabilities of directors extend to both their individual and joint actions. A director who commits a tort against his or her corporation can be held personally liable.

Directors are bound by certain duties such as the duty to act within the scope of their authority and to exercise due care in the performance of their corporate tasks.

board of directors

n. the policy managers of a corporation or organization elected by the shareholders or members. The Board in turn chooses the officers of the corporation, sets basic policy, and is responsible to the shareholders. In small corporations there are usually only three directors. In larger corporations board members provide illustrious names, but the company is often run by the officers and middle-management who have the expertise. (See: corporation)

References in periodicals archive ?
Janis Lievitis, a representative of Merks construction company, explained that Competition Council representatives had arrived in the company on Tuesday and had a meeting with Merks board chairman Oskars Ozolins.
The board chairman said as the paper pattern for entry test and board examination was different from each other, sometimes, high achievers in annual intermediate examination couldn't pass the medical college entrance test.
4- Al-Ahli Sports Club's board chairman, Khalid Ibrahim Kanoo.
The information was reported to have emanated from the GPHA workers' quarters, and had it that although Mr Mac Manu is still their Board Chairman, he has crossed carpet to also serve on the MPS Board, which, to them, will compromise his stand as the referee between the two organisations.
In addition to the three-pronged objectives plan and the direct aim of drilling more and more wells, the board chairman also plans to establish a technical library within OGDCL whereby the employees, and possibly outsiders too, will have the opportunity to read and study the energy industry and its processes on their own.
In accordance with the OOC's Statutes, Sheikh Saif bin Hilal Al Hosni was approved as acting Chairman of Board of Directors of Oman Olympic Committee until the convening of the Extraordinary General Meeting where the OOC Board Chairman will be elected.
Applicant Pervez Shaukat, a senior journalist, took stance that he challenged the induction of Wage board chairman under section-9 of the 1973 Constitution.
County board Chairman Aaron Lawlor, the driving force behind the commissions formation last year, urged commissioners to study the recommendations.
Commissioners unanimously selected Bozievich to succeed Pat Farr as board chairman on Tuesday, after Farr held the position all of last year.
| Wyn Evans, a beef and sheep farmer from Aberystwyth (current Livestock Board chairman); | Aled Jones, a dairy farmer from Caernarfon (recently stood down as Milk Board chairman); | Hedd Pugh, a beef and sheep farmer from Dinas Mawddwy (current Rural Affairs Board chairman).
From discussing financial best practices, serving customers on the move to meeting the new North American Retail Hardware Association (NRHA) board chairman, the next issue covers a lot of ground.

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