Legal Definitions - staggered board of directors

A staggered board of directors is a type of board of directors where the members' terms of service overlap so that only part of the board's makeup is voted on in any single election. This means that not all members of the board are up for election at the same time.

For example, let's say a company has a board of directors with nine members. If the board is staggered, three members might be up for election every year, with each member serving a three-year term. This means that only one-third of the board is up for election each year.

Staggered boards are often used by companies to provide stability and continuity in their leadership. By having only a portion of the board up for election each year, the company can ensure that there is always some level of experience and institutional knowledge on the board.

However, staggered boards can also make it more difficult for shareholders to make changes to the board. If a shareholder wants to replace a majority of the board, they may have to wait several years to do so.

Overall, staggered boards are just one way that companies can structure their boards of directors. The decision to use a staggered board or not will depend on the specific needs and goals of the company.