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.