Company Director

A company director is a person appointed to manage a company’s affairs and direct its business. Under the Companies Act, the business of a company is managed by, or under the direction of, its directors, who may exercise all the company’s powers except those the Act or the company’s constitution reserves for shareholders.

Who can be a director

Every Singapore company must have at least one director who meets ACRA’s local residency rules. A local resident director is a Singapore citizen, Permanent Resident, or EntrePass or Employment Pass holder. A Dependant’s Pass holder needs a Letter of Consent from MOM before acting as a director.

A director must also be:

• A natural person, not a company
• At least 18 years old
• Of legal capacity, and not disqualified

Disqualifications include being an undischarged bankrupt, certain convictions for fraud or dishonesty, repeated failure to file required documents with ACRA, or a court disqualification order.

Types of directors

• Executive director: a full-time employee who manages day-to-day operations
• Non-executive director: not an employee, and contributes outside experience and independent views
• Independent director: has no relationship with the company or its substantial shareholders that could affect independent judgment
• Nominee director: appointed to act on a nominator’s instructions, and recorded in the Register of Nominee Directors
• De facto director: acts as a director without a formal appointment
• Shadow director: does not act openly as a director, but the appointed directors are accustomed to following their instructions

De facto and shadow directors can carry the same legal duties as formally appointed ones.

Duties of a director

Directors owe statutory duties under the Companies Act, such as disclosing conflicts of interest, presenting financial statements at the AGM, and ensuring shares are issued only with required approval. They also owe fiduciary duties: acting honestly and in good faith in the company’s interests, avoiding conflicts between personal and company interests, using powers only for their proper purpose, and exercising reasonable care, skill and diligence.

Some decisions need shareholder approval, including issuing shares, altering the company’s name or constitution, and removing auditors.

Resident director for foreign founders

A foreign founder who doesn’t live in Singapore needs a local resident director. HeySara’s nominee director service can fill this requirement as part of company incorporation.