4 ms·
Suppose the conflicted interest on the board has majority share - would they still sit out on the vote?
by acchow 10y ago
Suppose the conflicted interest on the board has majority share - would they still sit out on the vote?
- Retric 10y agoNot sitting out opens you up to lawsuits. But, a lot of sketchy crap goes on.
- andrewfong 10y agoYes, what they're looking for is a majority (or 2/3 or whatever threshold is called for in the bylaws) of the disinterested directors. If there are no disinterested directors, or it's something like 5 out of 6 directors are conflicted and the 1 director isn't comfortable going it alone, then the company might ask for approval of a majority of the non-conflicted shareholders. This isn't strictly required I think, but it's considered the safe thing to do.