Chapter 6 - The Role of the Board

Question 1

What is the general function of the board of directors?

Answer 1

To promote the long-term sustainable success of the company, generating value for shareholders and contributing to wider society (UK Corporate Governance Code, Principle A).

Question 2

How is power divided between the board and the members?

Answer 2

The board manages the company’s affairs, but members can override board decisions through resolutions, especially in private companies.

Question 3

What are the key procedures for board meetings?

Answer 3

Meetings must follow the rules in the articles, including notice, quorum, voting, and minute-keeping. Decisions can also be made by written resolutions.

Question 4

What is the role of the company secretary?

Answer 4

To support the board, ensure compliance with legal and regulatory requirements and facilitate effective board processes.

Question 5

What is the quorum for board meetings under the model articles?

Answer 5

Two directors unless otherwise specified.

Question 6

Quick hit
Principle A (UK Code)

Answer 6

States the boards role is to promote long-term sustainable success.

Question 7

Quick hit
Board Quorum

Answer 7

Minimum number of directors required to hold a valid meeting.

Question 8

Quick hit
Written Resolution

Answer 8

A method for directors to make decisions without a meeting.

Question 9

Quick hit
Company Secretary

Answer 9

Officer responsible for governance, compliance and board support.

Question 10

Quick hit
Division of power

Answer 10

Board manages day-to-day; members can influence via resolutions.