For a corporation organized under the laws of a US state such as Delaware, the certificate of incorporation establishes the corporate entity, and corporate bylaws exist to provide more detail about the manner in which the business is governed and run on a day-to-day basis. The bylaws are subordinate to and must be consistent with the certificate of incorporation. Bylaws provide the rules for basic corporate functions – how the board of directors are elected, how corporate officers are selected, how to call stockholder meetings, and more. Many companies also include in their bylaws provisions restricting the rights of stockholders to transfer their shares to third parties.
Last reviewed: May 10, 2021