Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail
Investing Answers Building and Protecting Your Wealth through Education Publisher of The Next Banks That Could Fail

Quorum

What it is:

A quorum is the minimum number of directors required to conduct a board meeting. Usually is a quorum is a majority.

How it works (Example):

Let's assume Company XYZ has 10 board members. Its bylaws state that at least six board members must attend each board meeting for the board to conduct business.

A vacancy on the board does not change the number of directors needed for quorum.

Why it Matters:

In order to conduct business, a board must have a quorum. This ensures the shareholders' interests are adequately represented.