CINEMA 7 Lecture Notes - Lecture 17: Takeover, Secret Profit, Uptodate
Document Summary
The appointment of directors: arise on initial incorporation of company / reappoint at expiry / to fill vacancy / on creation of additional directorship. Company articles call for fixed proportion of directors to retire each year. Always proportion of directors on board with experience. Additional directors to join board to add necessary skills & experience: retirement, disqualification & removal of directors. Company law puts age limit (70); view that this is ageist & many older people have experience. Make sure no re-election out of sense of respect. Disqualification in case of bankruptcy, mental illness, etc. Members can call resolution calling for director removal; 19th century model: directors & shareholder suggest; still the case in private companies. With large number of shareholders around the world, no longer feasible to influence decisions on director choice. Criticism: boards became self-perpetuating clubs of like-minded people. Reliance of independent customers to avoid dominant director. Independence of outside directors can be illusory.
