Question

How are members of a corporation's board of directors selected?

Answer 1

The structure and powers of a board are determined by an organization’s bylaws. Bylaws can set the number of board members, the manner in which the board is elected (e.g., by a shareholder vote at an annual meeting)

While members of the board of directors are elected by shareholders, those put up for nomination are decided by a nomination committee. In 2002, the NYSE and NASDAQ required that the nomination committee consist of independent directors. Ideally, directors’ terms are staggered to ensure only a few directors are up for election in a given year.