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DM Corporate Sdn.Bhd.- Your Platform & Gateway To Incorporate Company At Your Finger tips In Malaysia.
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A limited and Private Limited company in
DEFINATION OF DIRECTOR
Definition of director under Section 4 of the Companies Act1965:
§ Any person who occupies the position of Director of a corporation described by whatever name.
§ Full age, sound mind, not an un-discharged bankrupt.
§ Includes Alternate/substitute.
§ Person whose habitual directions/ instructions are
habitually followed by the directors of the company though not formally appointed.
CRITERIA TO BE A DIRECTOR
§ Natural person,
§ Not Insane,
§ Not an un-discharged bankrupt,
§ Full age (18+),
§ Principal or only place of residence within
§ Holds qualifying shares [Sec. 122 and Article 71 Table A]
§ Age not > 70 years for public company (S.129) unless sanctioned by 75% of shareholders at the AGM.
§ Private Companies no age limitation.
WHO CANNOT BECOME A DIRECTOR
§ Un-discharged bankrupt (Sec. 125) unless special leave granted by High Court.
§ Convicted of offences connected with promotion and management of corporation, fraud & dishonesty punishable with imprisonment for 3 months or more, offence under Sec.132, 132A &303 of the Act. (within 5 years from his conviction unless with special leave by the court [Sec.130]
WHO CANNOT BECOME A DIRECTOR
§ Order of disqualification made by High Court [Sec.130A]
§ Minor [ Sec. 122(2)]
§ Age > 70 years for public company [Sec.129]
§ Unsound mind, mental disorder [Art. 72, 4th Schedule]
DIRECTORS’ DUTIES & RESPONSIBILITIES
Directors owe a duty to act for a proper purpose and in good faith in the best interest of the company.
They must manage the company’s affairs in accordance with:-
related statutes;
principles of the common law; and
the company’s memorandum & articles of associations
DIRECTORS’ FIDUCIARY DUTIES
§ Directors stand in a fiduciary relationship to the company in the performance of their duties.
§ New sections 132(1), (1A), (1B), (1C),(1D), (1E), (1F) (1G) and 132(2) of CA provides for statutory fiduciary duties upon directors.
§ S.132(6) & S. 4 of CA define ‘officer’ as to include:
- any director, secretary or employee;
- a receiver & manager appointed under an instrument; and
- a liquidator appointed in voluntary winding up.
§ The role of a director is often likened to that of a trustee/quasi trustee (as directors being the holders of the company assets they owe fiduciary duty of loyalty and good faith to the beneficiaries (company & its stakeholders) of that trust).
