The board of directors Flashcards
according to model articles, what is the directors’ general authority?
article 3: subject to the companies acts and the articles, the directors are responsible for the management of the company’s business, for which purpose they may exercise all the powers of the company
how do directors exercise decision-making power?
via board meetings
what is included in the rules of conduct of board meetings and where are they found?
in the articles of association:
- notice
- quorom - minimum number of people required to turn up
- decision making
- role of the chair
- board minutes
what is the definition of a director under s250 CA 2006?
any person occupying the position of director, by whatever name called
what is a de jure director?
in law
have been validly appointed as directors
what is a de facto director?
in fact
have not been validly appointed, but act as directors:
- someone who assumes the states and functions of directors
- someone who undertakes “functions in regard to the company which could properly be discharged only by a director - Re Hydrodam Ltd
- the assessment is one of fact and degree
what is a shadow director?
a person in accordance with whose directions or instructions the directors of the company are accustomed to act - s251(1) CA 2006
exemption for professional advisers - s251(2)
if the conduct of an adviser goes beyond the normal scope of his professional capacity and amounts to controlling the company’s affairs, he will be a shadow director - Re Tasbian Ltd
what is the role of a non-executive director according to the UK Corporate Governance Code 2018?
NED’s should provide constructive challenge, strategic guidance, offer specialist advice and hold management to account
what are the characteristics of executive directors?
usualy full time
employed by the company under a service contract
responsible for day to day management
non-executive directors characteristics?
part time
appointed via letter of appointment
independent
contribute to management, and monitor the board
how many directors must a private/public company have?
private = at least one
public = at least 2
s154 CA 2006
what are the first directors appointed on? and after?
incoporation - s12 CA 2006
thereafter, appointment is a matter for the articles
how can a director be appointed according to model articles?
either by ordinary resolution or by a decision of the directors
what are the requirements to be a director?
- must be a natural person
- must be over the age of 16
how can directors be removed?
members can remove directors by ordinary resolution under s168 CA 2006, notwithstanding in any agreement between the company and the director
