Every society has to be governed by a set of rules and regulations for it to operate smoothly. These rules have to be fair, comprehensive, and hinged on some fair principles. Knowing how to go about the business of setting them is definitely a wise thing to do. We dedicate the breadth of this article to that.
Bylaws: Also called corporate laws, the bylaws are a body of rules made by a corporate entity or local authority to govern the conduct of their members or subjects. They further demonstrate the purposes, tasks, responsibilities, expectations, and schemes of the said entities. It is essential that they are followed to the letter to avoid unnecessary conflicts.
Each entity has the leeway to draft the bylaws that mirror its own best interests. Nonetheless, there are some common pieces of information that these laws comprise regardless of the variations of the
a.) Name, Purpose, and Office(s)
The document has to state the name of the organization and its overall mission. That is because the subsequent bylaws have to line up with these missions and ethos. They should be followed by the exact offices of the firms.
Each organization comprises members of diverse kinds and forms. You have to specify this Membership as well for all to see. The members have to be specified with regard to the roles and their positions in the firm.
c.) Board of Directors
It is the board of directors that basically governs the organization. In this section, you basically lay bare the composition of the board. You go a step further to discuss how the vacancies are filled out if and when they arise.
Are there any special committees or ad hoc organizations within the company? If they exist, they too have to be showcased right here. Knowing about them will definitely aid in drafting the necessary rules better later on.
Officers refer to the members of the board who play some specific duties. In this section, you spell out how these officers are chosen, their duties, powers, and special responsibilities. Finish off by stating the procedures to follow to remove them or fill their vacant positions.
From time to time, organizations have to hold meetings. They, too, have to be stipulated in the bylaws. These include such crucial pieces of information like the timing of the meeting, prerequisites for notifying the board, requirements for attendance, voting rules, and the quorum issues or restrictions.
g.) Conflicts of Interest
Obviously, conflicts do arise from time to time. There has to be a way for these conflicts to be addressed and handled as they come. Yet again, it is important to demonstrate openly how the conflicts may be handled if and when they arise.
h.) Mode of Amendments
All laws are subject to change every quite often. The bylaws should also state explicitly how the amendments may be arrived at and or effected. Also of note is who may initiate the amendment, the quorum needed to pass any amendments, and how the same take effect. NB: It is important to furnish a copy of the bylaws to the various stakeholders of the firm. These include the members, directors, and officers in charge of several jurisdictions. Encourage them to read and understand the copy.
Bylaws Templates & Examples
Bylaws Example 1 (PDF)
Bylaws Template (Non-Profit Organization)
Simple Bylaws Example 2
Corporate Bylaws Example (PDF)
Tips for writing the Bylaws
You no doubt have to adhere to a set of tips to be able to draft quality bylaws. Below are some of the tips that have been proved to do a good job overall:
- Consult your attorney or other organizations that are similar to yours. They will give you the inspiration you need to draft yours in a nice way similarly.
- Appoint a different sub-committee to check and vouch for the consistency of your bylaws. That is to ward off bias or any other form of inconsistency that may arise with time.
- Read your company’s laws, vision statement, mission, and the core objectives for which it exists. All these have a bearing on the manner in which your bylaws may turn out to be.
- Familiarize yourself with the laws that govern your kind of organization in the state wherein you reside. They also determine, to a large extent, the nature of the laws you eventually put in place.
- Do not make the laws too detailed. Make room for some flexibility to give the various parties the freedom they need to act.
- Make the public of the laws for the sake of instilling trust and credibility to the parties who transact business with the firm. This is not mandatory but is highly recommended, though.
Alright! You now know the steps to take to draft good bylaws for your firm or local authority. The procedures we have outlined and exhausted above no doubt have the ability to get the job done for you. Only read them faithfully and diligently to be able to master the same appropriately.