The Guidance on M&A Integration Process for Post Merger Effectiveness
The meeting is not legally conducted if there aren’t enough board members. This article will provide you with some guidelines on how to ensure that your board meetings are held with a quorum, so that you can make decisions legally.
Quorum ensures that, even although perfect attendance isn’t common at board meetings, the decisions made are based on the views and preferences of everyone who is involved. It prevents the negative effects of minority rule where an incredibly small group of directors can have disproportionate influence and can take unilateral decisions that aren’t beneficial to an company or its stakeholders.
A majority of organizations have quorum rules set out in their bylaws. The rules may vary, but often include a certain percentage of board directors who must be present for a quorum to exist. Certain bylaws could also contain exceptions to the rule of law that are applicable in certain circumstances or for certain kinds of meetings.
When choosing a quorum percentage for your board, consider factors such as the size of your board as well as the difficulty of getting everyone in one place simultaneously. It is important to balance the flexibility and legitimacy of the quorum requirements, since it’s unlikely that everyone will be available for every meeting.
If the quorum is not reached prior to the start of the meeting, the chairperson should wait some time to see if any more members arrive to make it the minimum number required. If it becomes clear that the quorum isn’t reached, the chair should announce that a quorum is not present and no official business will be conducted during the meeting.