7a Directors Flashcards

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1
Q

What is a director?

A

Person who fulfils the role of a director.

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2
Q

What are the different types of director?

A
  • De facto director
  • De jure director
  • Shadow director
  • Alternate director
  • Executive director
  • Non-executive director
  • Managing director
  • Chairman
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3
Q

What is a De Jure director?

A

Director at law (followed correct legal procedure).

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4
Q

What is a De Facto director?

A

Director in fact (not legally appointed but fulfils the role)

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5
Q

What is a shadow director?

A

Type of De Facto director who the board of directors usually follow instructions from.

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6
Q

If someone is providing advice to directors, does this make them a shadow director?

A

No, not if they’re acting within their professional capacity.

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7
Q

What is an executive director?

A

Traditional type of director who is an employee of the company and has a specific role such as finance director.

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8
Q

What is a non executive director?

A

Directors involved on a part time basis who receive a nominal fee and role is to control the executive directors to protect the members interests.

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9
Q

What is a managing director?

A

They are an executive director who’s role is to run the company.

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10
Q

What is a chairman?

A

A non executive director who’s role is to run the board and ensure correct procedure is followed in directors meetings.

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11
Q

What is an alternate director?

A

A director who is appointed by the main director who’s role is to fill in for them when necessary.

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12
Q

What 2 ways can a director be appointed?

A
  • By members (>50% vote)
  • By existing directors (members will vote on this at the next AGM)
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13
Q

What 5 ways can a director be removed?

A
  • Death
  • Resignation
  • Not standing for re-election
  • Removal
  • Disqualification
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14
Q

In what circumstances must a directors step down based on the model articles?

A
  • Prohibited by law
  • Bankruptcy - order made against them
  • Composition with creditors re their debts
  • Incapacity - doctor/court deems them physically or mental unable to act as a director.
  • Notice of resignation
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15
Q

What is the procedure for a director to be removed?

A

Special notice must be given for a meeting, director can circulate representations to plead their case, director can attend the meeting, members must pass an ordinary resolution.

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16
Q

What are the issues with removing a director?

A
  • If a director is also a member, they can vote on this decision.
  • Director can claim for wrongful termination.