A term of office is a period formally prescribed under the articles of association of a company for which a person is appointed as a member of a corporate body. This term is more about the designated period than the actual service duration of a member.
Significantly, a term of office is not the same as a mandate. A term of office is a technical and legal designation indicating the period for which a member of the management board is appointed. Conversely, a mandate authorizes its holder to act in an official capacity and exercise the rights of a member of the management board.
In Poland, the rule is an individual term of office, meaning that in a management board with more than one member, the duration of each member’s term is assessed individually. This means each member may start and end their term at different times, and the duration of their service may vary. The articles of association may specify different terms for different members, such as a five-year term for the chairman and a three-year term for other members. There is nothing to prevent appointing one member for a definite term and another for an indefinite term, although technically, an indefinite term is not a term of office but a mandate to act in an official capacity.
The effects of such arrangements are subject to individual assessment for each member, based on the rules laid down under Article 202 § 1 and 2 of the Commercial Companies Code. Another possibility is a staggered system of management board appointments, where a certain number of members successively step down, either by drawing lots, based on seniority, or otherwise. The introduction of individual terms of office does not contradict the principle of collective exercise of rights and performance of obligations by the entire management board. This applies to conducting the affairs of the company, adopting resolutions, etc. If the duration of the term of office is not laid down under the articles of association, the term expires on the date the meeting of shareholders approves the financial statements for the company’s first financial year, effectively providing a one-year term of office.
The duration of the terms of office of different management board members may differ even if the articles of association lay down a uniform term for the entire board. This is the case when management board members are appointed for a joint term of office under Article 202 § 3 of the Commercial Companies Code. A joint term of office means that on a specific date, the mandates of all members expire, regardless of their individual term durations. However, this does not mean that all members must serve throughout the board’s term. A mandate of one or more members may expire earlier due to death, dismissal, or resignation, and a replacement is appointed. The term of office of a new member will last only until the end of the term of the other members.