Putting up a company entails a lot of responsibilities. It’s not easy to run a business, especially if the roles of the key people behind it are not clearly defined. If you happen to be the company director, what are your duties and responsibilities? This article will tell you what you need to know and inform you of your rights and obligations.
First, let’s define what a director is. To put it simply, that person manages the affairs of the company. All companies have at least one director. That individual is usually appointed and can either be a “de facto director” or a “shadow director” in which the other directors and staff follow your instructions.
As expected, the duties and responsibilities of company directors are varied. That person is expected to perform the following:
Directors who fail to do their duties well risk suffering from serious consequences. If found guilty, they can be criminally charged and be imprisoned for five years or fined up to $200,000. They may be disqualified from managing any company in the future. In some cases, erring directors may be held personally liable for company losses.
Many are unaware that being a “de facto” or “shadow director” gives them the same duties as validly appointed directors. This misunderstanding can cause problems later, especially if they don’t know this. Failing to disclose conflicts of interests is another common problem that directors may face. Directors must also take steps to monitor the company’s solvency, cash flow, and debts or risk being liable for future debts.
If you are confused about your rights and responsibilities as a company director, get in touch with the friendly lawyers of Deo Volente (DV) Solicitors in Bedford, UK. We will gladly provide you with the information you need so you can act accordingly. Don’t hesitate to call us for clarification. We are here to help.