Every corporation needs guidelines and policies to govern its operation and administration. If a corporation only has one shareholder, this task is easy, as only one decision maker is likely to be involved. When a corporation has multiple active or passive shareholders, however, corporate administration runs more smoothly when the rules and procedures for the company's decision making are fully documented. Corporate bylaws and resolutions provide this.
Corporate bylaws are the rules and regulations that govern the corporation. Corporate bylaws require formal adoption by the board of directors before they can be considered to be in effect. Bylaws outline the mission or business of the corporation, its geographic areas of operation and the duties, roles and responsibilities of its directors and officers. A quorum of the board of directors must be reached to amend the bylaws. State law governs corporate bylaws.
The bylaws should include: