Entire board resigns but appoints new BOD? The logistics of an entire board of directors resigning en masse on the same day, while somehow managing to appoint an entirely new board just prior to their collective resignation, indeed raises serious concerns. In the context of a publicly listed company in Canada, the board of directors typically lacks the authority to unilaterally appoint a whole new board without obtaining shareholder consent.
The appointment and removal of directors are generally governed by the corporation’s bylaws, the Canada Business Corporations Act (CBCA), or the relevant provincial corporate statutes. These legal frameworks are designed to prevent such unchecked actions by ensuring that significant decisions, such as the reconstitution of the entire board, are subject to shareholder approval.
While the board may possess limited authority to fill vacancies that arise between annual general meetings, this power does not typically extend to the wholesale replacement of the board. RevoluGROUP Canada's news release yesterday is not only highly irregular but also raises substantial questions about the regulatory validity of such an abrupt and comprehensive change in governance.
https://revolugroup.com/news/revolugroup-canada-inc-announces-the-welcome-of-an-interim-ceo-interim-chairman-and-two-new-directors-and-the-resignation-of/
The notion that an entire board could orchestrate its own replacement without shareholder input is both shocking and troubling. It appears to contravene the foundational principles of corporate governance that are meant to protect shareholder rights. One cannot help but question how such an event could transpire without immediate regulatory scrutiny and challenge.