Your corporation needs to approve a contract, appoint an officer, or authorize financing. Does the board need a meeting, or can the directors sign a written consent? California law permits both methods, but they have different voting and documentation requirements. This guide explains when board written consent makes sense, when a meeting is more appropriate, and what California businesses should preserve in their corporate records.
Start with your entity type and governing documents
This article focuses on California stock corporations governed by the General Corporation Law. Limited liability companies, nonprofit corporations, and corporations formed in another state follow different statutes. A company operating in California should not assume California corporate voting rules govern every internal decision.
Before selecting an approval method, review the corporation’s articles of incorporation, bylaws, and any relevant shareholder agreement. Identify who has authority to approve the transaction: the board, shareholders, or an officer acting within delegated authority. Some transactions require more than one level of approval.
A signed document does not replace a required shareholder vote, eliminate a contractual restriction, or establish that the corporation has satisfied a lender’s closing conditions. A corporate governance review can help separate these requirements before a decision moves forward.
Board written consent: California requirements
California Corporations Code § 307(b) permits board action without a meeting if all directors serving at the time consent in writing and the number of directors serving constitutes a quorum. For an ordinary, nonconflicted decision, the practical starting point is unanimity—not a simple majority.
For a transaction covered by § 310, an interested or common director may abstain in writing and still be included within “all members” only if § 307(b)’s conditions are satisfied. These include disclosure or board knowledge of the specified material facts before execution of the consents, a conspicuous statement of the abstention in the consents, and sufficient approval without counting the abstaining director’s vote, as required by § 310(a)(2) or (b)(2). This is not a general exception allowing majority approval by written consent.
The written consent must be filed with the board’s minutes. An action taken through a consent satisfying § 307(b), including its quorum requirement and any applicable interested- or common-director conditions, has the same force and effect as a unanimous vote of the directors. This can make consent useful for routine decisions when every director agrees and already has enough information.
- State the action clearly. Identify the transaction, appointment, expenditure, or other decision being approved.
- Include supporting materials. Attach or clearly identify the agreement, budget, or other document the directors are approving.
- Confirm the directors. Verify the current board membership and that the directors serving constitute a quorum, rather than relying on an outdated signature list.
- Collect the required consents. Silence, an unanswered message, or informal agreement is not a substitute for written consent.
- Preserve the completed record. Keep the consent and relevant attachments with the corporate minutes.
If using electronic signatures or electronic delivery, confirm that the process satisfies applicable legal requirements. Do not assume a casual email exchange establishes a valid board action.
When a board meeting is the better choice
A meeting is often more useful when directors need discussion, have questions, or disagree. Unlike ordinary action by written consent, a meeting generally does not require every director to approve the proposal. Under Corporations Code § 307(a)(8), the default rule is that an act or decision approved by a majority of the directors present at a duly held meeting at which a quorum is present is the act of the board, subject to §§ 310 and 317(e) and any validly applicable articles, bylaws, or other statutory requirements.
That distinction matters. Suppose a corporation has three authorized directors, and all three attend a properly called meeting, constituting a quorum. If two vote for a routine proposal and one opposes it, the proposal ordinarily may be approved, subject to the articles, bylaws, and other applicable statutory requirements. Circulating a written consent does not remove the ordinary unanimity requirement.
Meetings also require attention to procedure:
- Follow the applicable notice requirements or obtain appropriate waivers.
- Confirm a quorum before taking action.
- Provide directors with materials sufficient to evaluate the proposal.
- Record the motion, vote, and any dissent or abstention accurately.
A meeting need not always be in person. California law permits participation through conference telephone and certain other communication methods when statutory conditions are satisfied. Whatever the format, minutes should reflect what actually occurred—not a discussion reconstructed later.
Shareholder consent follows different rules
Do not apply the board’s unanimity rule automatically to shareholder action. Under California Corporations Code § 603(a), unless the articles provide otherwise, shareholders generally may act without a meeting and without prior notice through written consent as specified in § 195. The consent must set forth the action and come from holders of at least the minimum voting power necessary to approve it at a meeting where all shares entitled to vote on the action were present and voted.
That does not mean a simple majority is sufficient for every proposal. Class voting rights, statutory approval thresholds, and governing-document provisions may affect the required consent. Section 603(d) generally requires unanimous written consent of all shares entitled to vote to elect directors, except for certain vacancies that the subsection permits shareholders to fill by less than unanimous written consent.
Section 603(b) also imposes notice requirements for less than unanimous written consent. If all shareholders entitled to vote were not solicited in writing, notice of shareholder approval under §§ 310, 317, 1152, 1201 (subject to § 603(b)’s reorganization exception), or 2007 must be given at least 10 days before consummation of the authorized action to shareholders entitled to vote who did not consent in writing. For other corporate action approved by less than unanimous written consent, prompt notice must be given to shareholders entitled to vote who did not consent in writing. Before relying on shareholder consent, identify the voting threshold and notice obligations for the specific transaction.
Build a record that matches the decision
Choose the process before requesting signatures. Written consent is efficient when everyone agrees; a meeting provides a structured opportunity for discussion and voting. Neither method excuses conflicts of interest, missing approvals, or inadequate information.
- Identify the decision-maker. Determine whether board approval, shareholder approval, or both are required.
- Check the rules. Review the governing documents and applicable statutory requirements.
- Document the exact action. Use clear resolutions and identify final transaction documents.
- Complete the procedure. Obtain required signatures or conduct a properly convened meeting.
- Maintain the record. Preserve consents, minutes, notices, waivers, and attachments.
Avoid backdating signatures or creating minutes for a meeting that never happened. If an earlier approval is missing or defective, assess the appropriate corrective steps rather than assuming a later signature resolves every issue.
Talk to a California business attorney
Itkin Law offers a free consultation to discuss approval procedures and corporate records for your next business decision. Schedule a free consultation or call (424) 603-8888.
This article is attorney advertising and provides general information only. It is not legal advice and does not create an attorney–client relationship. The law changes, and this article reflects the law as of its publication date. Every situation is different — contact us to discuss how the law applies to your exact circumstances. See our full disclaimer.
