Mergers & Acquisitions

Resources: Glossary

Don’t be confused or intimidated by any terms or abbreviations in the M&A world. You’ll find answers here.

Board of Directors

Definition

A group of experienced people, elected by the shareholders of an entity, who act as representatives of the shareholders and make major decisions for the company on behalf of the shareholders.

See Also

Board of advisors.

Tips

A board simplifies the decision-making process for the shareholders by consolidating the group making the decisions. Without a board, major decisions would be left to each of the individual shareholders. The power and duties of the board are specified in the corporate bylaws. A board is often required when a firm raises outside investment money in the form of equity. The investors usually require a formal board, along with one or more seats on the board.