What are the legal requirements for the composition of a company's board of directors?
In the Luxembourg market, companies are generally managed by a single director or a board of directors.
The Company Law allows also for a two-tiered management structure which can be implemented only in a SA where the management board acts under the supervision of the supervisory board.
Number of directors or members
Depending on their form, companies may be either managed by a single manager (S.à r.l.), a sole director (SA with one shareholder), a chairman (SAS), a single manager (SCA, SCS, SCSp) or by a board of managers (S.à r.l.) or board of directors (SA).
In SA, there must be a minimum of three members in the board of directors.
In a SA with a two-tier structure, the same rule applies for the management board (at least 3 members). There is no minimum requirement for the supervisory board.
Employees’ statutory rights to board representations are limited by the Luxembourg labour code in companies which have or had more than 1,000 employees working on the Luxembourg territory during three consecutive years.
The employees sitting at the board of directors are appointed by the company’s staff delegation, must represent 1/3rd of the board members and benefit from the same rights than the other directors.