The duties and responsibilities of company directors’ can be far reaching. They may vary with the changing business aspects of day to day life as well as looking at the success and growth of the business in the future.
You can have one or more than one director for your company; depending on the size of your business. There will be a board of directors in the most established companies who are responsible for:
The first directors of the company are appointed at the same time when you register your company officially. Whether you pick one or many persons to be as your company’s directors in the future, the name of all of them are written in the IN01 form, and then considered to be announced as the first directors of the company.
For example, when you register your company with ZDK Formations and name your company’s first director or directors, it is compulsory for every director to specify their full name, date of birth, residential address, country of residence, nationality, former names, and most important business occupation and expertise. This is the standard information which every person needs to mention clearly in their application form to work as a director of the company.
Appointments for the directors can also make by submitting the AP01 form, and the new directors coming on the project can also be governed by articles of association of the company. In general, the articles of the company outline all the responsibilities of the board of directors to appoint new staff members or to hire new directors up to the maximum number of directors mentioned in the company’s articles.
While registering an address with Companies House, a director can either submit his service address or residential address. The service address will be displayed on the public records, while the home address will remain private.
The director of a company has to present a general notice of any interest in any contracts which involve the business. Under the Disclosure and Transparency Rules, it is mandatory to the directors of all PLCs to state any declaration of the interest in the shares of the company.
According to the rules, all the new directors of business are given a copy of the articles of association and memorandum of the company. With a detailed description of the business affairs over past two years including statutory reports, board meeting minutes, and accounts reports.
What powers do company directors have?
In simple words, the responsibilities and roles of the directors of a company cover all its activities and management system, and able to perform and handle all the mentioned powers within the company smoothly. But, by the articles of association and constraints of the Companies Act 2006, the authorities given to the directors are limited. For example, the director of a company is not allowed to pass any finance or borrowing on the behalf of the business without discussing it with other members of the board. It depends on the decision of other board members; they can either approve it or decline it. There are several such kinds of rules written into articles of association which represent that directors of the companies have only limited powers.
The directors of the company basically act as a group with other members of the board to discuss and approve concerns and issues. It doesn’t mean that the single director of a company is nothing without the support of the team. The articles of association can permit the board of directors to hand over the power to company’s directors wherever necessary or suitable. For example, sending only one member of the board to represent the business at the regular meeting to announce a decision or to discuss and negotiate different deals.
What sort of duties do company directors perform?
As directors of the company, there are several statutory roles and duties that they need to perform efficiently. In the end, it all depends on the directors of the company to ensure that all the legal tasks in the company are under the supervision of the law.
There are some laws and equitable duties created for the new directors as per the rules mentioned in The Companies Act 2006. And, all the new directors of the company have to follow such rules. Here are seven general duties of new directors which they must follow:
One of the main described responsibilities that all directors need to stick with: the preparation of all accounts of the company and report of displayed to shareholders, with the subsequent filling of the directors and accounts report with the Registrar of the Company at Companies House. This is the responsibility of directors to make sure that the company manages the full accounting records accurately.
In case, if some companies are pointed out as disobeying these statutory duties, then the directors of such companies can be liable for all penalties and debts. Still, the members of the board can have a defense, if they believe that these described duties were given to a capable personality to complete, but were mislead somehow.
The legal responsibilities that the directors of the companies can experience for their omissions or acts while directing the business can result in personal liability, which can be both criminal and civil. According to the Disqualification Act 1986 of the company’s directors, if a person is found liable, he/she can be disqualified from the role of the director of a company. And, this disqualification period can be between two to fifteen years.
There are only a few directors’ duties, responsibilities, roles, and liabilities described in the listed articles. Want to know about the roles of a company’s director? Or need further guidance about the formation of your business, feel free to contact us. Our professional and friendly team members are there to assist you.
ZDK Formations is there to offer professional customer support to all of its clients. We help you before, during, and after the registration of your company. You can reach and talk to our supportive customer support team anytime you need any help. There are many communication channels including telephone, email, etc. Choose any of them as per your comfort zone. We also offer after sales account support. If you have any similar questions or doubts after your company has been registered, you can tell us. We are here to provide the efficient and quick answers to sort your queries.
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