What is a 'by-law' in the context of corporations?

A by-law in the context of corporations serves as a foundational document that outlines the internal rules and procedures for managing the corporation. It establishes how the company operates on a day-to-day basis, detailing the responsibilities and rights of its members, including the board of directors, officers, and shareholders. By-laws may cover a range of topics including the frequency of meetings, voting procedures, appointment of officers, and the process for decision-making.

This internal governance document is essential for ensuring that the corporation complies with legal requirements and operates smoothly, as it provides a structured framework that guides the organization in its activities and interactions among its members. By-laws can be amended as needed, allowing the corporation to adapt to changing circumstances or governance practices, all while remaining compliant with the overarching laws applicable to corporations.

The other options do not accurately capture the essence of by-laws. For instance, by-laws are not specifically legal documents for tax exemption, nor are they primarily focused on public disclosures or solely on guidelines for shareholder voting, although they may touch on these aspects.