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Company Law

There are several types of directors under the Companies Act 2013, including residential directors who must reside in India for at least 182 days, independent directors who serve to prevent conflicts of interest, and women directors to promote gender diversity on boards. Directors have responsibilities like setting strategic objectives, monitoring progress, appointing senior management, and accounting to shareholders. Their powers include some loans, service contracts, interested transactions, and share issuances, but certain decisions require shareholder resolutions.

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61 views2 pages

Company Law

There are several types of directors under the Companies Act 2013, including residential directors who must reside in India for at least 182 days, independent directors who serve to prevent conflicts of interest, and women directors to promote gender diversity on boards. Directors have responsibilities like setting strategic objectives, monitoring progress, appointing senior management, and accounting to shareholders. Their powers include some loans, service contracts, interested transactions, and share issuances, but certain decisions require shareholder resolutions.

Uploaded by

parth sarthi
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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INTRODUCTION

According to “Section 2(34) of Companies Act 2013 ” a director is appointed to the Board of
a Company. There are many types of directors which have a different role to play
accordingly. Here in this article we will discuss types of directors in a company according to
the companies act, 2013.

TYPES OF DIRECTORS
1. Residential Director: – According to Section 149(3) of Companies Act,2013, Every
company should appoint a director who has stayed in India for a total Period of not
less than 182 days in the previous calendar year.
2. Independent Director: – According to Section 149(6) an independent director is an
alternate director other than a Managing Director which is known as Whole Time
Director Or Nominee Director. According to Rule 4 of Companies (Appointment and
Qualification of Directors) Rules,2013 these are the following type of companies
which have to appoint minimum 2 independent directors:-
I} Public Companies which have Paid-up Share Capital-Rs.10 Crores or More; –
II} Public Companies which have Turnover- Rs.100 Crores or More:-
III} Public Companies which have total outstanding loans, debenture, and deposits of
Rs. 50 Crores or More.
3. Small Shareholders Directors: – Small shareholders can appoint a single director in
a listed company. But this action needs a proper procedure like handing over a notice
to at least 1000 Shareholders or 1/10th of the total shareholders.
4. Women Director: – As per Section 149 (1) (a), there are certain categories according
to which there should be at least one woman as a director on the Board. Such
companies are any listed company or any public company having. There are types of
directors in women director also:

 Additional Directors:-
Any Individual can be appointed as Additional Directors by a company under section
161(1) of the New Act.
 Alternate Directors:-
As per Section 161(2), a company may appoint, if the articles confer such power on
the company or a resolution is passed (if a Director is absent from India for at least
three months).
 Shadow Director:–
A person who is not the member of Board but has some power to run it can be
appointed as the director but according to his/her wish.

RESPONSIBILITY
There are some responsibilities which board of directors has to play:
• determining the company’s strategic objectives and policies.
• monitoring progress towards achieving the objectives and policies.
• appointing senior management.
• accounting for the company’s activities to relevant parties, e.g. shareholders.

DIRECTORS’ POWERS
The decisions which must be made by a resolution of the members are:
Most of the companies have not inserted any special article or did not pass any resolution
which says that director does not possess the power to perform certain actions. But according
to the Act, it needs a resolution in general meeting which specifies this type of power. The
following decisions should be made by the directors but usually also require a resolution of
the shareholders:

 Some loans to directors


 Directors’ fixed term service contracts for more than 2 years
 Substantial property transactions in which directors have a personal interest
 Issue shares
 Delegation to individual directors:-

The powers noted above are given to the directors collectively. For this, the board must
delegate power to the director concerned. Both the Model Articles and Table A permit this.

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