News & Insights
Distribution of Duties of Board Members in Joint Stock Companies
Selen Torun | TRAINEE26.01.2023
The Board of Directors is the management and representation body of a joint stock company and its absence is a ground for dissolution. The number of members shall be specified in the articles of association and the board of directors shall consist of at least one member. There are exceptions in terms of the number of members in some joint stock companies subject to special provisions.
Pursuant to the Turkish Commercial Code No. 6102 ("TCC"), the Board of Directors is authorized to take decisions on all kinds of transactions and affairs necessary for the realization of the Company's field of activity, except for those that are left to the authority of the General Assembly in the law and the Articles of Association.
Article 366/1 of the TCC regulates the distribution of duties of the members of the board of directors of joint stock companies. If the board of directors, which is the management and representation body of a joint stock company, is composed of more than one member, the board of directors must elect a chairman and at least one deputy chairman, to deputize the chairman in his/her absence, from among its members every year. The articles of association of the company may also stipulate that the chairman and deputy chairman, or one of them, shall be elected by the general assembly.
1. Distribution of Duties:
The distribution of duties is based on the election of a chairman and at least one deputy chairman. It is important to elect the chairman and deputy chairman from among the members of the board of directors because the chairman of the board of directors is given various powers in matters such as the management of meetings and information rights.
2. Distribution of Duties Must Be Made Every Year:
Pursuant to the TCC, although board members may be elected for a maximum of three years, the distribution of duties must be made every year. For each year of activity, it is useful to make sure that it is done at the earliest possible time.
3. The Body to Decide on the Distribution of Duties:
As a rule, the distribution of duties is made by the board of directors. However, the articles of association may stipulate that the chairman and vice chairman of the board of directors shall be elected by the general assembly.