Company directors homepage

What is a director?

Directors are responsible for managing the company’s day-to-day business and may or may not be shareholders.   Directors owe duties to the company, to its shareholders, and to others dealing with the company.

Directors must act honestly in what they believe to be the best interests of the company and with such care as may reasonably be expected of them in all the circumstances.

Directors must not carry on the business in a manner likely to create a substantial risk of serious loss to the company’s creditors (also called 'reckless trading').

• Read more about directors' obligations

How many directors should a company have?

A company must have at least one director.  

When you form a company you can choose to appoint as many directors as you like.  It is worth bearing in mind that people who accept directorships should be aware of the responsibilities that go with directorships.  They need to know in particular what is meant by reckless trading.

• Learn more about who cannot be a director 

Case study: directorships

These comments from an experienced business coach may be of help:

“Company directors are much more accountable now than in the past. I see many people that make their life partners directors of a company, even when that person will have little to do with the running of the business. Many people associate some prestige with being a company director, or think that it looks good on a business card!

However, by inviting a person to become a director of your company you are also potentially exposing him or her to the risks of the business and especially to the responsibilities that go with a directorship.

I advise the businesses I work with to avoid inviting people to become directors unless they are clearly capable of adding value to the business and know what they are in for. Similarly, I would never personally accept a directorship of a company unless I felt fully confident in the values and integrity of the other directors."

• Read more about director responsibilities