Selecting Your Board of Directors
Selecting a board of directors is an important step as you are starting your corporation. Your board members will help you make decisions and also satisfy the requirements of the state in which you are incorporating. Here are some things to think about before you select board members.
How Many Board Members Should There Be?
First, select an uneven number of board members, to avoid ties. The number of board members depends on the size and complexity of the organization. For a small organization, five to seven people is plenty. For a larger, more complex, organization with several committees, you might want 9 to 11 people at minimum. You need enough so that, if several people are not present, you can still have enough to make a decision, and for a quorum.What Does a Good Board Member Look Like?
When you are recruiting board members look for these characteristics:
- Expertise in a specific area which can help your corporation. For example, many corporations include an attorney and a financial advisor on their boards.
- Leadership and management experience, especially in related businesses.
- Commitment to the business. Board members must be interested in the business and its continued well-being. They should not be serving just for the money or for personal interests.
- Time and energy to devote to board duties. Board members will be expected to spend time preparing for and attending board meetings, and to serve on additional committees.
- Integrity and lack of a conflict of interest. Board members will need to sign a conflict of interest statement and they must act in the best interest of the business, not their own individual or business interests. For example, a board member who profits from his or her service on a board of directors may put the entire company in jeopardy.
Of course, each type of small business need specific kinds of people to serve on its board of directors. But all businesses need individuals with integrity, commitment, and interest as board members.
Back to Corporation Startup Checklist
