Does my corporation need a board of directors?

The answer is yes. Under Massachusetts law (G.L. c. 156D, sec. 8.03), a corporation must have a director (or more, depending on the number of shareholders). The question then becomes, what does a director do?

· A board of directors is a group of people who oversee the operations, policies, and strategy of a corporation.

· A board of directors can provide valuable guidance, advice, and oversight to the executive management and shareholders of a company.

· A board of directors can help prevent costly mistakes, reduce risks, and enhance the reputation and performance of a company.

· A good board of directors should have members with integrity, leadership experience, and commitment to the company's vision and values.

Essentially, the shareholders own the corporation, and the board of directors runs the corporation (usually through executives who handle the day-to-day matters). Here's an article that explains why a good board of directors is necessary because management comes from the top down.

If you form a corporation, you must know that besides creating the governing documents, you need to choose a director (or directors). If you are a small business and sole shareholder, then the director will likely be yourself. But if you are a larger corporation – or have grown into a larger corporation – choosing your directors with care is essential. The director or board of directors will decide for the corporation. Yes, shareholders choose the director, but ultimately the director runs the company.

If you are forming or already have a corporation and have a question about directors, please reach out, and I'd be happy to help.