Chairman: Overview, definition, and example
What is a chairman?
A chairman is the head of a board of directors or governing body, responsible for overseeing meetings, facilitating discussions, and ensuring that decisions align with the organization’s goals and governance policies. The chairman is often elected by board members and may have specific voting rights, including the ability to cast a deciding vote in case of a tie.
For example, in a corporate board meeting, the chairman leads discussions, sets the agenda, and ensures that board resolutions are properly considered and voted upon.
Why is the chairman important?
The chairman plays a critical role in maintaining order and efficiency within a board or committee. They provide leadership, ensure compliance with corporate governance, and help drive strategic decision-making.
For businesses, having a well-defined chairman role ensures clarity in leadership structure, prevents conflicts, and facilitates effective decision-making. In legal terms, the chairman's authority and responsibilities are often outlined in corporate bylaws or shareholder agreements.
Understanding the chairman through an example
A public company’s board of directors elects a chairman to preside over meetings and act as a liaison between the board and executive management. The chairman ensures that all board members have the opportunity to voice their opinions before key decisions are made.
In another case, a nonprofit organization appoints a chairman to oversee board meetings and represent the organization in official matters. The chairman is responsible for signing off on board resolutions and ensuring compliance with the organization’s bylaws.
Example of a chairman clause
Here’s how a chairman clause might appear in a corporate governance document:
“The Chairman shall preside over all meetings of the Board of Directors and shall have such other powers and duties as may be prescribed by the Company’s bylaws. In the event of a tied vote, the Chairman shall have the casting vote unless otherwise provided in this Agreement.”
Conclusion
The chairman serves as the leader of a board or governing body, ensuring structured decision-making and compliance with governance policies. Clearly defining the chairman’s role in corporate documents helps maintain accountability, streamline board functions, and prevent disputes over leadership authority. A well-drafted chairman clause ensures transparency and consistency in organizational leadership.
This article contains general legal information and does not contain legal advice. Cobrief is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.