Company Officers

Limited company directors and secretaries are collectively referred to as ‘officers’. Directors are appointed by members (shareholders or guarantors) to run and manage the day-to-day operations of the company.

Secretaries are optional for private companies, but not public companies. They are usually appointed to assist directors with important legal tasks.

Can anyone be a company director?

A director is a person appointed to run a company. This role can be held by a person or a corporate body. You can have just one director in a private company (although a public company needs two), and there is no upper legal limit to the number of directors you can have.

All natural (human) directors must meet the following criteria to be appointed:

  • Must be at least 16 years old
  • Cannot be an un-discharged bankrupt
  • Cannot be the company auditor
  • Cannot be on the disqualified directors register
  • Not otherwise prevented from acting as a director

Shareholders (or guarantors) are often directors of the companies they own. It is very common for one person to set up a limited company by themselves and assume the positions of sole director and sole shareholder.

Duties of a company director

Directors are required to run a company in accordance with the Companies Act 2006 and the articles of association. They are placed in a position of trust and expected to promote the success of the business and make decisions for the benefit of the company alone, not for personal gain.

Directors are legally responsible for ensuring all filing and reporting requirements are met. This includes:

  • Registering the company for business taxes
  • Preparing and delivering confirmation statements, annual accounts and tax returns every year
  • Maintaining accurate accounting and company records
  • Making these records available for public inspection
  • Report changes to Companies House and HMRC
  • Managing payroll and PAYE

Failure to uphold these statutory duties can lead to fines, prosecution, and disqualification.

Difference between a director and a shareholder

A director manages the company. A shareholder owns the company. However, it is often the case that those who are appointed as directors are also shareholders, and vice versa, particularly in small companies and start-ups.

Difference between natural directors and corporate directors

A natural director is a human being. A corporate director is the term used for a company, firm or organisation appointed as the director of another company. A company can have as many corporate directors as it wishes, but there must be at least one natural director always appointed.

Please be aware: corporate directors are technically outlawed following the introduction of The Small Business, Enterprise, and Employment Act 2015. However, the ban on corporate directors is currently being implemented, so they can still be appointed.

Companies with corporate directors appointed should monitor the implementation of this ban going forward.

Non-resident directors

Directors of UK companies can live anywhere in the world, and they are not required to be UK nationals, so you can run a British company from any country. You will still have to adhere to UK taxation rules and company filing requirements.

Please consult an accountant or business advisor if you are thinking about setting up a UK company as a non-resident.

Non-resident directors

You can appoint, resign, and even remove a director as you wish, as long as any appointment, resignation, or removal adheres to company law and the articles of association.

Shareholders and guarantors normally retain the power to appoint and remove directors. They also dictate some of their duties and powers.

To appoint or remove a director, members are required to pass an ordinary resolution at a general meeting or in writing via a written resolution.

You must tell Companies House as soon as possible if a director joins or leaves or any existing directors’ details change.

You can do this online through your company formation agent, or online or by post using Companies House form AP01 (to appoint natural directors), AP02 (to appoint corporate directors), or TM01 (for the termination of a directorship).

The statutory register of directors should also be updated.

Company Secretaries

This is an optional role for private companies, so you do not have to appoint a secretary if you do not need or want to unless the articles of association state otherwise.

Public companies are required by law to have a company secretary always appointed.

The purpose and role of a company secretary is to reduce the workload of the company directors by taking on some of their statutory duties and responsibilities, for example:

  • Completing and filing confirmation statements, annual accounts and tax returns
  • Maintaining company registers and records
  • Reporting changes to Companies House and HMRC
  • Arranging meetings and minutes of meetings
  • Signing contracts and documents of behalf of directors
  • Overseeing payroll

Any person or corporate body can be the secretary of a private company, provided they are not also the company auditor, a disqualified director or an un-discharged bankrupt.

There are no formal qualifications required to hold the position of secretary in a private limited company, but the role does demand a great deal of skill, knowledge, and competence. Any person appointed as a secretary must be fully able to carry out the responsibilities and duties effectively.

Public liability companies and secretaries

Public limited companies must ensure that the person appointed as secretary has the required experience to undertake their work. Additionally, section 273 of the Companies Act 2006 sets out the appropriate qualifications that the secretary must have one of:

  • Being a member of a certain body, such as The Chartered Governance Institute of UK and Ireland or The Institute of Chartered Accounts in England and Wales
  • Being a barrister, advocate, or solicitor
  • Being a company secretary of a public company for at least three of the previous five years
  • Is someone who, because of their experience or membership of another body, appears capable of discharging the functions of a company secretary.

Appoint or remove a secretary after incorporation

You can appoint and/or remove a secretary at any time after company formation. Any such changes must be reported to the registrar online through your company formation agent, online or by post using Companies House form AP03 (appointment) or TM02 (termination).

The statutory register of secretaries should also be updated.