In business, time and resources are gold, so we really don't want to clutter the inbox of subscribers (click here to read how to subscribe) with useless or trivial pieces of information. The required number of corporate directors seems to be an obvious matter, which is the reason we haven't discussed it here. However, recent queries through Google-search (the latest being "required number of directors in the philippines") have shown that such assumption is false.

 

A corporation, as discussed in a previous article, is a favorite business entity. Since it is an person created by legal fiction, it acts primarily through its Board of Directors. Under the Corporation Code (Sec. 23), corporate powers are exercised, all business conducted, and all properties are controlled by the Board of Directors or trustees. This is why the Board of Directors is important. This is also why battles arise as to its membership and control. Whoever controls the Board of Directors controls the corporation and its business.

 

The members of the Board of Directors are elected from among the holders of stocks (also called stockholders, shareholders) or where there is no stock like in non-stock corporations, from among the members of the corporation, who shall hold office for one year until their successors are elected and qualified. Every director must own at least one (1) share of the capital stock of the corporation, which means that a director who ceases to be the owner of at least one share of the capital stock ceases to be a director.

 

The Corporation Code (Sec. 10) also provides that a corporation must be created by at least five (5) but not more than fifteen (15) natural persons, technically called "incorporators"�. A member of the Board of Directors, or a Director, is different from an incorporator. Still, the Corporation Code (Sec. 14) requires that there should also be at least five (5) but not more than fifteen (15) directors of a corporation.

 

So, there you go. Now you know how many directors are required under the Corporation Code. It's time to stop thinking about it and focus on business.