A company director’s role in Singapore can be extensive, as they are in charge of monitoring and execution of proceedings concerning the company. An employee within a company can act as a director as well, however, that’s not usually the case. This post will deal with a company director’s role in Singapore as well as their responsibilities
How many directors are necessary for a company to function without a hitch?
Well, the Company Act of Singapore states that a company must at least have one company director taking care of all the major affairs of a given company. They must be either a Singaporean citizen, permanent resident, or once a company is incorporated, then an individual can be sponsored to act as a local director on an Employment Pass work visa.
Eligibility for being a company director
To be a company director with a company, one has to meet the following requirements
1. They must be a natural person i.e. a corporation cannot act as a director.
2. They must be of sound mind.
3. They must be over 18 years of age.
Grounds on which a person can’t be a director
These scenarios prevent one from becoming a director in Singapore. And they are listed right below
1. Bankruptcy– if they are found bankrupt.
2. If they are an unfit director of another company
3. Someone who has been involved in offenses such as dishonesty or fraud that is punishable with imprisonment of three months or more either in Singapore or elsewhere.
4. Someone that is seen as a threat to national security.
Duties of a director
Although a director has a myriad of duties and responsibilities, however, there are two major ones that are absolutely imperative
1. Fiduciary Duties
2. Statutory Duties
Let us take a look at both of them in brief
1. Always act for the betterment of the company
A company director ought to be impartial and must act in the best interest of the company.
2. Avoid conflict of interest
It’s the responsibility of a company director to ensure that they set aside any personal interest that could pummel company’s best interest, thereby driving conflict of interest.
3. Must not misuse the powers or knowledge they possess
This one is quite self-explanatory. A director must be loyal to the company and hence they must use their powers bestowed upon them carefully and for the betterment of the company.
1. Annual Accounts
Section 201 of the Companies Act states that every year company directors are obligated to submit financial statements to the shareholders at the AGMs. They must submit the statements at least once a year.
2. Hold Various Meetings
Company directors are the ones who are supposed to hold meetings
This one is quite self-explanatory. A director must be loyal to the company and hence they must use their powers bestowed upon them carefully and for the betterment of the company. Three such meetings are:
Annual General Meetings (AGM): At least once a year
Statutory Meetings: Company Directors of Public companies must hold a statutory meeting within the first three months after starting the business.
Extraordinary Meeting: if requested by the shareholders (owning at least 10% of the shares in the company) company directors are to hold an Extraordinary General Meeting.
3. Account Records
In accordance with section 199 of the Companies Act, company directors in Singapore must be clear as far as the financial position of the company is concerned.
Company directors have several other statutory duties as well
Those are as follow:
Appointment of an Auditor
Issues of Shares
Payment of Dividends
Duty to Disclose
A company director’s position is one of the most imperative positions in a company
If you have anything to ask in regards to company director’s role in Singapore, free feel to comment down below or reach out to us. Or if you want to incorporate a company, just hit the “request” button.