In this week’s Freedom Friday blog and email newsletter, we’re continuing our new year series, “Top Six in 2026,” and we’re talking about the six most popular topics from last year’s Freedom Friday blog and email newsletter. This week we are once again bringing up a topic that made the Top Five list in 2025. In fact, this was the fourth popular blog article. However, this topic was even more popular last year, as it is the 2nd most popular topic in our Top Six in 2026. In this week’s Freedom Friday blog and email newsletter, I’m answering the question, “Does my LLC need a board of directors?”
First of all, if you’re a single-member LLC, the answer is no, you do not need a board of directors. Even a two-member LLC (for instance, an LLC owned by a husband and wife), a board of directors isn’t necessary, either. However, if you have a multi-member LLC, with lots of members, and your LLC is a manager-managed LLC, you can have a board of directors if you really want to, but again, it may not be necessary, although it’s ultimately up to you, the small business owner.
Now, that answer may sound confusing, so let me back up and explain a few things. A limited liability company (LLC) in Oklahoma is formed by filing articles of organization with the Oklahoma Secretary of State. The owners of an LLC are called members, not shareholders, as you see in a corporation. An LLC provides the same liability protection to the LLC members just like a corporation provides liability protection to its shareholders. LLCs also exist perpetually or can designate a time for dissolution, and LLCs provide flexibility in operation and administration similar to a partnership. An LLC operating agreement should be drafted (preferably by an attorney) and signed by all the members of the LLC. The operating agreement functions just like a corporation’s bylaws and govern the company’s operations, the relationships between the members, and helps define the duties and responsibilities of the members to the company and to each other, especially if it is a member-managed LLC.
An LLC operating agreement can be flexible enough to allow a variety of structures and management schemes. Therefore, if they desire, LLC members can structure their LLC similarly to a corporation and designate a board of directors. However, in order for this to happen, the LLC members must first agree that the LLC is to be structured as a manager-managed LLC and not a member-managed LLC. In a member-managed LLC, the members of the LLC, regardless of how many, make all the decisions of the business. Typically, if there is more than one LLC member, the members have to meet and make important decisions. The more LLC members the more difficult it is to manage a member-managed LLC. This is why an LLC can choose to be a manager-managed LLC. In a manager-managed LLC, the LLC is managed by a designated manager or managers. In a smaller manager-managed LLC, it is sometimes best just to have a point person, who is an appointed manager, to run the company. That person can be a member of the LLC, or it can be a non-member, in which case the manager is often paid or compensated. If a manager-managed LLC has more than one manager, then that opens the door to a possible board of directors to manage the company.
If an LLC is managed by a board of directors, it will have the formal management structure of a corporation but will retain the desired characteristics of an LLC, e.g., ease of formation, better asset protection than a general partnership, and overall flexibility in taxes. You can also streamline management by creating more defined roles for each of the directors. However, this type of management structure also opens the door to fiduciary duties of the members and/or managers of the LLC. Under Oklahoma law, unless the LLC operating agreement specifies otherwise, the LLC members usually do not owe a fiduciary duty to each other and/or to the LLC itself. However, if one of the LLC members is going to serve as a manager of the LLC, or the LLC will be managed by a board of directors, then the managers (directors) should have fiduciary duties as specified in the operating agreement. Otherwise, you don’t need to have fiduciary duties, nor do you need to have a board of directors for your LLC.
Again, you can make your LLC as complicated as you want to, and have it managed by a board of directors, if all the LLC members agree to that. However, in most small LLCs, a board of directors is usually not necessary.
Thinking about starting a small business? Or maybe your small business is having issues with contracts, leases, business partners, collection issues, or experiencing other barriers to growth? Please contact me at Jonathan@libertylegalok.com to schedule a FREE consultation.
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