The board's executive committee (art. 269 LGS)
Article 269 of the General Companies Law allows the bylaws to organize an executive committee of directors dedicated to managing ordinary business. The board oversees its activity and retains its powers; this arrangement does not modify the directors' obligations or liability.
What article 269
Article 269 authorizes the executive committee and clarifies that it does not alter the board's liability.
The bylaws may organize an executive committee made up of directors who are responsible solely for managing ordinary business. The board shall oversee the activity of this executive committee and shall exercise the other legal and statutory powers that pertain to it.
Liability. This arrangement does not modify the obligations and liability of the directors.
Source: Law 19,550, art. 269 — InfoLEG (updated official text)
Commentary
The executive committee is a tool for agility in large boards: a smaller group handles day-to-day matters. But its creation does not dilute liability: the directors remain liable, and the board must oversee the committee.
It differs from managers (art. 270), who may or may not be directors and exercise executive functions upon appointment by the board. The executive committee, by contrast, is made up solely of directors and is organized under the bylaws.
Distinctions often confused
Practical impact
The executive committee streamlines management without releasing the board from liability, which must oversee it. Its powers should be well regulated in the bylaws.
Frequently asked questions
Does the executive committee replace the board?
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