Welcome, Guest: Join Nairaland / LOGIN! / Trending / Recent / New
Stats: 2,690,729 members, 6,339,376 topics. Date: Monday, 14 June 2021 at 11:50 PM

Can The Board Of Directors Fire The Owner Of A Company? - Investment - Nairaland

Nairaland Forum / Nairaland / General / Investment / Can The Board Of Directors Fire The Owner Of A Company? (31324 Views)

Adeniyi Adebayo Daniel The Owner Of Bobmarket.com.ng Is A Useless Fraudsters / Investors Lose $190m As Owner Of Cryptocurrency Company Dies With Passwords / MMM Shuts Down Operations And Site After The Death Of The Owner, Sergey Mavrodi (2) (3) (4)

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) ... (11) (Reply) (Go Down)

Can The Board Of Directors Fire The Owner Of A Company? by Casper21: 12:43pm On Jun 06
The question “Can the board of directors fire the owner?” is becoming increasingly contentious. CEOs and founders of companies often find themselves out of a job after being fired by means of a vote undertaken by the board of the company. If the person in question is not the owner of a controlling share in the company, there is not much they can do to avoid being fired.

Sharing the ownership of a company leads to loss of total control over it. As external investors are brought in, owners' shares get diluted, and the founder of a company can often find that he or she owns less than half of the shares in that company. This leaves him or her at risk of being fired.

If a CEO has a contract in place, he or she may get fired at the end of that contract period, if the company has new owners or is moving in a new direction.

The CEO, despite being the person who incorporated the company, often gets fired in times when the company is experiencing a slump in financial performance. This is because internal company politics and differing leadership styles render people vulnerable.

If a founder gets fired, then the company's investors have obviously lost confidence in that founder's ability to establish profitability. Or, in the case of a company that is already turning a profit, they do not consider the founder capable of helping the company grow and evolving to meet the needs of a changing market.


...Strategies for Avoiding Dismissal....

Tech Crunch advises executives to always remain defensive, working with key players and building personal relationships with board members and shareholders. These, according to Tech Crunch, are the most important strategies in defending oneself from being attacked by the board of one's own company.

Founders and CEOs need to focus on more than the fact that they are indispensable – they also need to recognize the areas in which they are vulnerable. They can do this in a number of ways:

Knowing whether or not a board vote is enough to fire them.

Being aware of whether or not alleged wrongdoings need to have taken place in order for them to be dismissed.

Keeping one's ears open to listen for complaints and expressions of discontent, and
Being careful of the contracts that they sign.
An important step that CEOs can take to protect their position is to get all promises in writing. A CEO should never trust anybody who claims to always have his or her back.

55 Likes 6 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by Freestainworld(m): 1:07pm On Jun 06
Very possible, if your shares gets decreased

56 Likes 2 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by Kobicove(m): 1:28pm On Jun 06
The fact that you founded the company does not necessarily mean that you're the most suitable to manage it when it grows to a certain level or when some conditions of operation change.

So, yes the Board of Directors can fire the owner!

107 Likes 3 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by Premiumwriter2: 1:28pm On Jun 06
I'll personally draft and create a contract and get the very first investors to sign that at all times I'll own 60% of the shares.

All share sales and dilution will come from the remaining 40%. Can't come and form a company and then some modaf*ckers will push me out.

413 Likes 31 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by beautyhd: 3:34pm On Jun 06
It's possible if the collective shares of the directors are up to 60 percent.

In this case he is removed from the position and decision making powers taken from him but somehow still retained as the founder of the company.

45 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by adekusibe10(m): 5:25pm On Jun 06
Means. I should nt add this two directors again

5 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by BigDawsNet: 6:48pm On Jun 06
Only if owned 10% shares of the country

They can easily pay him off with additional 10% of his or her shares...

But still if you sturboon...you can sue your boards of directors....

8 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by thebosstrevor1: 6:48pm On Jun 06
Yes.

Many startups founders suffer from this problem. They eventually become employees or they get sack from the company they founded grin

Smart founders do not allow outside investors have a higher share than them.

152 Likes 8 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by harmargedon: 6:48pm On Jun 06
Yes they can

2 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by socialmediaman: 6:49pm On Jun 06
If the board’s collective shares are above 50%, they can fire the CEO even if he’s the founder of the company.

19 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by NewDelhi(m): 6:49pm On Jun 06
Depends on the percentage of shares he has. If it's above 50% then you're just wasting your time.

63 Likes 1 Share

Re: Can The Board Of Directors Fire The Owner Of A Company? by brosom(m): 6:49pm On Jun 06
I don't think so, but they'll limit his responsibilities.

2 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by Karleb(m): 6:49pm On Jun 06
It's not possible if you own a larger share than the investors combined.

12 Likes 1 Share

Re: Can The Board Of Directors Fire The Owner Of A Company? by Agent8706(m): 6:49pm On Jun 06
The first time I saw this crap was in Spiderman when Norman Osbourne was fired from his own company and I thought this could only happen in the movies.

But I had an opportunity to work with corporate lawyers and knew the processes of registering a company. If you want to retain full ownership of your company, make sure you don't sell your share of the company to exceed 49.9 percent. Meaning you must have at least 50.1 percent of the company share. Anything below that and the shareholders can come together and boot you out if they have majority of the shares.

Corporate lawyers in the house can correct me if I am wrong

151 Likes 12 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by djsjxjfjdisjdjb: 6:49pm On Jun 06
yes oooo
Re: Can The Board Of Directors Fire The Owner Of A Company? by Mandesz(m): 6:49pm On Jun 06
It's not possible. The owner of the company appoints director of be the cost. He can also fire them as well. He's likely to appoint relative or somebody loyal to him.

2 Likes 1 Share

Re: Can The Board Of Directors Fire The Owner Of A Company? by Lanretoye(m): 6:49pm On Jun 06
I think it depends on the kind of company...ie can dangote group of companies fire dangote?,and there is this bank that the CBN asked a chairman to restore the CEO.
Public corporation is different from private corporation...I stand to be more enlightened.

5 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by saferoom: 6:49pm On Jun 06
Okay
Re: Can The Board Of Directors Fire The Owner Of A Company? by Atonsboy(m): 6:49pm On Jun 06
SEEN. Yes
Re: Can The Board Of Directors Fire The Owner Of A Company? by womjomfashion(f): 6:50pm On Jun 06
shocked
Re: Can The Board Of Directors Fire The Owner Of A Company? by Dozie32(m): 6:50pm On Jun 06
Can devil defeat Christ?
Re: Can The Board Of Directors Fire The Owner Of A Company? by yinchar(m): 6:50pm On Jun 06
YES

The owner should retain the majority shares if he doesn’t want to be fired…51% of the shares will do just alright.

26 Likes 3 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by Born2winnx: 6:50pm On Jun 06
Me am giving just 30% shares out to investors.

21 Likes 2 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by TRUSTEDGUY: 6:51pm On Jun 06
Yes through majority votes.
Re: Can The Board Of Directors Fire The Owner Of A Company? by Genea(f): 6:51pm On Jun 06
Always ensure you have the controlling shares

20 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by Dottore: 6:51pm On Jun 06
@Casper21 this is a Copy and paste effort and you even went as far as making it seem as if you are the originator of the article.

This country doesn't take copyright laws serious. Everybody plagiarizes with impunity. Can you at least acknowledge the source from which you copied the the article.
#spits#

The article came from"
https://www.upcounsel.com/can-the-board-of-directors-fire-the-owner

46 Likes 3 Shares

Re: Can The Board Of Directors Fire The Owner Of A Company? by TheGodmother(f): 6:51pm On Jun 06
Definitely.

As long as it's a public trading company, the owner is just a shareholder.

Others have invested money in his company.

So he can't break any rule.

But it will be very difficult to fire him, if ALL the shareholders don't agree.

It's a consensus decision.

7 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by TsaTrinity(m): 6:51pm On Jun 06
Very possible.
This happens specifically to Public Limited Companies like Dangote, Forte Oil, Banks and many more

9 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by LagbajaTheBEREAN: 6:51pm On Jun 06
thebosstrevor1:
Yes.

Many startups suffer from this problem
Lass lass, na sole propertorship go be the koko be that, partnership is not advisable bi that buh pesin wey no con get bar how hin wan take start sef...

13 Likes

Re: Can The Board Of Directors Fire The Owner Of A Company? by quincyshakur(m): 6:52pm On Jun 06
Can u as a son fire ur fada from his own house

4 Likes 1 Share

Re: Can The Board Of Directors Fire The Owner Of A Company? by Shegzy8(m): 6:52pm On Jun 06
Please I'm having issues with the payment of my rent, I'm about been rendered homeless. I'm in need of anyone to lend me #15,000 to complete my rent and I'll pay back by month end. Please, I'm ready to do anything to verify my identity and show commitment towards paying back.

You can quote me if you're willing to help.

(1) (2) (3) (4) (5) (6) (7) (8) (9) (10) ... (11) (Reply)

8 Common Mistakes That Every New Investor Needs To Avoid / H2 Report: 31 States Fail To Attract Fresh Investments / Intercontinental Bank Share Certificates

(Go Up)

Sections: politics (1) business autos (1) jobs (1) career education (1) romance computers phones travel sports fashion health
religion celebs tv-movies music-radio literature webmasters programming techmarket

Links: (1) (2) (3) (4) (5) (6) (7) (8) (9) (10)

Nairaland - Copyright © 2005 - 2021 Oluwaseun Osewa. All rights reserved. See How To Advertise. 82
Disclaimer: Every Nairaland member is solely responsible for anything that he/she posts or uploads on Nairaland.