Difference between Directors and Shareholders
One of the main requirements to register a Singapore Private Limited Company is that to have at least one Singapore resident director. This means that the person have to be a Singapore citizen, Singapore Permanent resident or Entrepreneur Pass holder.
Duties of directors fall under two broad categories:
1. Statutory duties of care, skill and diligence, and
2. General Law duties or fiduciary duties of loyalty and good faith.
Statutory duties are administrative duties, enforced by the Accounting and Corporate Regulatory Authority of Singapore (ACRA) such as:
1. General duties of disclosure.
2. Updating and maintaining the accounting records of the company.
3. Preparing the financial statement for the company’s Annual General Meeting (AGM).
4. Ensuring that the first AGM is held within 18 months of the incorporation of the company and, following that, in every calendar year, at an interval not exceeding 15 months.
5. Ensuring that regular directors’ and shareholders’ meetings are held in order to review the company’s financial and trading position.
6. Ensuring that the company maintains a member’s register and other statutory books at its registered office.
7. Appointing an auditor within three months of incorporating the company.
General Law or fiduciary duties, enforced by the Company are as follows:
1. Directors must act in good faith and in the interests of the company. In other words, the director must act honestly. The interests of the company are the interests of its members, creditors, and other companies in the group, employees, customers, suppliers, and the community.
2. Directors must utilize their freedom to make decisions on the behalf of the company wisely.
3. Directors must not place themselves in a position of conflict, where a personal interest...