What is your role as a Director of a company according to Sri Lankan Companies Act?
Director is a person occupying the position of director of the company by whatever name called, Executive Director, Non-Executive Director, Independent Director, Shadow Director, Chairman, President etc…
In addition to being director of the company appointed by the shareholders, you can be contracted by the company for the employment as a Managing Director/Chief Executive Officer.
In such a situation you will be a Director on the Board appointed by the shareholders & also an employee by contract with the company. Thus you can play a dual role at the same time.
As a Director you ought to be aware of the civil & criminal liabilities under the Companies Act. Also you ought to know (at the least) certain provisions of the Companies Act & ignorance is no longer excuse for any Director.
Articles of association is the document that as a director you must be familiar with because it provides the internal management mechanism of the company. This in effect contains a contract
- between the company and each shareholder
- between the company and each director & company secretary
- between & each other shareholder of the company
under which each party agrees to observe and perform the functions set out in the Articles.