Commentary

109 The need for restrictions on board and shareholders’ decisions

BUSINESSES vol 4(2) start-up, sale and purchase
| Commentary

109 The need for restrictions on board and shareholders’ decisions

| Commentary

(e) Decisions of the board and shareholders’ meetings

109 The need for restrictions on board and shareholders’ decisions

The regime under the Companies Act 2006 and standard company articles leaves minority shareholders extremely vulnerable to unwelcome decisions of the majority. Board decisions, even those of fundamental importance to the company’s business, are usually made by a majority and the constitution of the company may be changed with the consent of only 75% of the shareholders1.

In addition, there will be many circumstances where the minority disagrees with a proposed decision, not on the grounds of bad faith or bias, but purely as

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