Can shareholders remove a director from an Ontario corporation's board?

Yes. The Ontario Business Corporations Act gives shareholders the right to remove a director before the end of their term by passing an ordinary resolution at a shareholders' meeting called for that purpose. An ordinary resolution requires a simple majority of votes cast. The shareholders can then elect a replacement at the same meeting or leave the seat vacant until the next annual meeting.

There are procedural requirements. The meeting must be properly called with appropriate notice, and the agenda must make clear that director removal is on the table. If a corporation's articles give particular shareholders the right to elect a specific director, that group of shareholders holds the corresponding right to remove the director they elected.

Directors who feel their removal is improper — for example, because the process was procedurally defective or because the removal violates a shareholders' agreement — may have grounds to challenge it. Conversely, minority shareholders who feel the director serves a legitimate oversight function may have grounds under the oppression remedy to contest a removal driven by majority-shareholder self-interest. If director removal is anticipated in your corporation, getting legal advice before calling the meeting can help both sides understand their rights and avoid costly mistakes.