Company Registration

Who are the directors?

Company directors are people who take up the responsibility of managing the company. They are responsible to promote the success of the business and also benefit the shareholders.

Director -There is no such specific definition of a director in statute, but in general the term “director” defines as any person who is not a minor or a person who together with the other members forms a board of directors and are responsible for forming and managing the company.

A director needs to be rationally diligent with the right kind of skill, knowledge and experience to be able to carry out important roles in the company.

The law permits a public limited company to have at least 3 directors, a minimum of 2 directors in the case of a private limited company and a one-person company can have a minimum of 1 director.

What are the types of Directors?

There are many types of directors. Here, we will discuss the different types of directors according to the Companies Act, 2013.

1. Residential directors – It is mandatory by law that every company should appoint at least one  director who has been residing in India for a total period of not less than 182 days in the previous calendar year.

2. Independent directors – According to Section 149(6) an independent director is an alternate director other than a Managing director who is also known as a Whole Time Director or Nominee Director.

They are non-executive directors who help in the improvement of corporate credibility and also in the enhancement of government standards. He may not have a relationship with the company

The tenure of an independent director is 5 years. They are also entitled to re-appointment by passing a special resolution during the general board meeting.

The following companies need to appoint at least two independent directors:

• Public companies that have a paid-up capital of Rs 10 crore or more

Public companies that have a turnover of Rs 100 crore or more

• Public companies having outstanding loans, deposits and debentures of          

  Rs 50 crore or more.

3. Small Shareholder directors – According to section 151 of the Act every listed company may have one director appointed as small shareholder,Upon the notice of a minimum of 1000 shareholders or 10% of the total number of shareholders, whichever is lower, can have a director who is elected by the small shareholders

4. Women director – A private or a public company would require a woman director to be appointed if the company satisfies any one of the following criteria:

The company is a listed company and the securities of the company are listed in the stock exchange

The paid-up capital of such companies is Rs 100 crore or more and the turnover is Rs 300 crore or more.

5. Additional director – A person can be appointed as an additional director. This post will be retained until the next Annual General Meeting. If there’s an absence in the AGM, then the term of the director will conclude on the day the meeting should have been held.

6. Alternate director – Alternate director is the title given to a person appointed by the board to fill in for a director during his absence. The director may be absent from the country for more than 3 months.

7. Nominee directors – Nominee directors are directors who are appointed by a certain class of shareholders, banks, lending financial institutions, third parties through contract, or by the Union government if in case of any oppression or mismanagement.

Roles and responsibilities of the director

  • Directors play a very important role in determining the company’s strategy, objectives and policies.
  • They monitor the progress of the company keeping in mind the objectives and policies of the company.
  • Appointing the senior management of the company.
  • Making sure that the statutory returns are filed.
  • To act in a Good faith.
  • To perform the duties with due and reasonable care.
  • They should not attempt to achieve any undue gain or advantage either to him/herself or to any of his/her relatives.


Directors take up the responsibility of managing the company. They are the backbone of a business. The responsibility of running the business successfully lies in the hands of the directors. A director needs to work diligently to promote the business for greater opportunities.

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