Officers of a company

The officers of a company are those responsible and liable for the decisions of the company. They include the company secretary and the directors of the company. The procedure for the appointment and termination of such officers will be laid down in statute, the company’s articles of association and if applicable, any shareholder agreement.

How many officers must a company have?

At least one company secretary is required in a public company and a minimum of two directors at all times. A private company does not require a company secretary at all, however it must have one director who must be a natural person. There is no upper limit as to how many officers a company may appoint in statute, but the company’s own articles of association may set out a maximum number.

Company Secretaries

A company can appoint a natural person or a corporate entity as its company secretary. If a corporate company secretary is chosen, the secretary will act through someone authorised by that company to act on their behalf. It is also possible to appoint joint company secretaries.

The duties of the company secretary are defined by the directors but they usually centre around the administration of the company and amongst other things including:

  • Calling and dealing with the administration of board and shareholder meetings
  • Keeping a record of all company meetings
  • Updating the statutory registers when appropriate
  • Ensuring the company meets it’s Companies House filing deadlines and occasionally signing the documents
  • Protect the goodwill of the company
  • Ensuring compliance with the company’s memorandum and articles

The role of the company secretary has grown over the years, therefore the directors must ensure that the secretary is suitable and qualified to be in that position. A company secretary of a public company is required to meet specific criteria in order to be appointed. It is the directors of the company who must take reasonable steps to ensure that the company secretary is qualified for the role.

The directors manage the company on a day-to-day basis and act on behalf of the company when making business decisions and entering into contracts. Directors hold a considerable amount of power within the company structure, more than that of a company secretary, though there are no restrictions on a director also holding the office of company secretary. A director must be at least 16 years of age.

There are numerous types of directors which equate to the directors’ level of input into the company. An executive director is an employee of the company and will hold a service contract and be paid a salary. On the other hand, a non-executive director may not be involved in the daily running of the company, their main role is to attend and vote at company meetings, and to provide advice and guidance. These directors will be entitled to director fees.

There are also ‘de facto’ directors and ‘shadow’ directors, who in sense are not formerly appointed as directors but perform the functions of one. These forms of director, although not formerly appointed, will still have the same duties as an ordinary director and will pick up the same liabilities.

What Are a Director’s Duties?
Company law imposes a number of duties on the director(s) of a company, as seen below:

  1. Duty to act within their powers
  2. Duty to promote the success of the company
  3. Duty to exercise independent judgement
  4. Duty to exercise reasonable care, skill and diligence
  5. Duty to avoid conflicts of interest
  6. Duty not to accept benefits from third parties
  7. Duty to declare interest in proposed transactions or arrangements with the company

These duties should be considered by the appointee of the company when looking to appoint a director and during the time of their directorship as a director may be sanctioned in the event they do not comply with the law.

What is a Chairperson?
Directors will usually have the power to appoint one of themselves as the chairperson if it is not set out in the company’s articles. This person will chair the directors’ board meetings and shareholder meetings. The powers of a chairperson will also be determined in the company’s articles. It should be noted that a chairman’s role is to make sure the meetings are conducted efficiently and compliant with statute and any provision of the company’s articles.  

This reflects the law at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought as appropriate in relation to a particular matter.

Michelle Lamberth
Senior Paralegal, Corporate
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This reflects the law and market position at the date of publication and is written as a general guide. It does not contain definitive legal advice, which should be sought in relation to a specific matter.

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