Can each member on the board of a company represent a different percentage of the company?

Question

Does the amount of Board Members on a company have to evenly match the % of the company they represent?

Please read carefully,
On the board of a private or public company, is it required that the number of board members be evenly split to represent the different percentages of the company owned by multiple people?

Example: The VC owns 25%, 25% is publicly traded, and the CEO owns 50%. Then 4 board members are needed, 1 for the VC, 1 for the public, and 2 to represent the CEO's 50% holding?

OR

Can each member on the board represent a different percentage of the company? Example: 3 board members needed; 1 for the VC @ 25% voting power, 1 for the public @ 25% voting power, and 1 for the CEO @ 50% voting power?

References would be really helpful.

I guess what my question is is: Lets say I'm a CEO that owns 51% of the company and there are 4 other "hostile" board members representing the other 49%. Can I, as just 1 board member, vote my 51%, or do I have to hire 3 other board members to represent my stake?

Dam, that seems really counterintuitive and founder unfriendly. Thanks for the answers everyone.

Answer 1

It is my understanding that the voting power of each board member is based upon the number of people in the board and not the percentage of the company.

Answer 2

It doesn't work the way you describe it. Board members represent shareholders. Each board member has an equal vote on matters that come before the board. A shareholder with a majority of the stock can elect the majority of board members, including himself in order to control the voting, but board members don't vote a certain percentage of shares. Boards usually consist of an odd number of people so that ties are avoided.

Answer 3

The short answer is no. The practical answer is yes and no. Here's what happens: Stockholders elect board members. Therefore, you would assume/presume that the board member would vote in a manner that would help the person that votes for them. The board member, however, also has a fiduciary responsibility to the corporation and ALL of the stockholders to do what is in the best interest of the corporation. They are legally liable if they don't act/vote in the company's best interest and a problem develops. So, even though there is loyalty to the stockholder who votes them in, they would and should only carry that loyalty so far. Hope this helps.

Answer 4

this is not required, nor legal in most jurisdictions.

all Board members formally have equal voting power.
as always, one or more members probably dominate the Board and their views are voted in.

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and, in effect, it frequently occurs in that the CEO in your example would elect two members while the VC elected one and the public nominated one.

Note that I said nominated for the public's representative -- Board members are nominated, frequently by the Board itself or a subcommittee, and (in most companies) only those nominated may be elected.

since the public is poorly organized (at best), they'll likely end up voting for someone nominated by the CEO.

Answer 5

you should pay the tax. yet once you make investments the income on your pension scheme, the government pays into it an volume equivalent to the tax. innovations you, the annuity which you will ought to purchase on the tip, would be legalised theft, besides the undeniable fact that it fairly is for an excellent reason. the extensive annual bonuses of the financial industry.