Director Rotation

AAA

DEFINITION of 'Director Rotation'

The cycle by which board members serve and vacate their positions. A policy regarding director rotation, or rotation of directors, may be included in a corporation's corporate governance policy and can specify the term that each member serves as well as the number of board positions that will be up for reelection each year.

INVESTOPEDIA EXPLAINS 'Director Rotation'

An example of a typical director rotation policy can be one that specifies that one-third of the directors will "retire by rotation" - vacate their positions - leaving them open for new directorship each specified period. The directors that have served the longest will be included in the one-third to retire by rotation. Directors are typically elected at the corporation's annual meeting.

RELATED TERMS
  1. Boardroom

    Besides the general definition as a meeting room in an office, ...
  2. Inside Director

    A board member who is an employee, officer or stakeholder in ...
  3. Board Of Directors - B Of D

    A group of individuals that are elected as, or elected to act ...
  4. Outside Director

    Any member of a company's board of directors who is not an employee ...
  5. Chair Of The Board - COB

    The most powerful member on the board of directors who provides ...
  6. Strategic Management

    The management of an organization’s resources in order to achieve ...
Related Articles
  1. Evaluating The Board Of Directors
    Insurance

    Evaluating The Board Of Directors

  2. Evaluating A Company's Management
    Active Trading Fundamentals

    Evaluating A Company's Management

  3. Do ETFs have a board of directors?
    Investing

    Do ETFs have a board of directors?

  4. What is the difference between a president ...
    Investing

    What is the difference between a president ...

comments powered by Disqus
Hot Definitions
  1. Elasticity

    A measure of a variable's sensitivity to a change in another variable. In economics, elasticity refers the degree to which ...
  2. Tangible Common Equity - TCE

    A measure of a company's capital, which is used to evaluate a financial institution's ability to deal with potential losses. ...
  3. Yield To Maturity (YTM)

    The rate of return anticipated on a bond if held until the maturity date. YTM is considered a long-term bond yield expressed ...
  4. Net Present Value Of Growth Opportunities - NPVGO

    A calculation of the net present value of all future cash flows involved with an additional acquisition, or potential acquisition. ...
  5. Gresham's Law

    A monetary principle stating that "bad money drives out good." In currency valuation, Gresham's Law states that if a new ...
  6. Limit-On-Open Order - LOO

    A type of limit order to buy or sell shares at the market open if the market price meets the limit condition. This type of ...
Trading Center