What is a Nominee Director?
A Nominee Director is an individual who represents an organization when the entity does not have a local (native) director to fulfill corporate responsibilities in a particular country. Many regions require corporate entities to have at least one local citizen serve as a director for the company. This role is also referred to as a Resident Director. The company’s board of directors appoints this duty, and responsibilities include serving the board’s interest in a local capacity, with signing authority to make decisions on behalf of the board/organization.
Does our company need a Nominee Director?
Nominee Directors are not necessarily required for all entities in every country. Nominee Directors or Resident Directors are only required in certain countries and can be provided as short-term or long-term solutions for companies needing a local corporate director per government regulations. Many companies expanding internationally are fortunate enough to have someone in-house who can serve in this role. However, many others don’t have an employee at the leadership level who can assume these duties. In such cases, a Nominee Director would be the best and most compliant option for a company to fill this internal gap.
What are the primary duties of a Nominee/Resident Director?
A Nominee/Resident Director’s duties will depend heavily on a company’s needs and available resources in the country. The responsibilities tend to break into three categories: fiduciary, statutory, and preferential duties. Below is a non-exhaustive list of the activities a Director may support:
- To act in good faith and with all honesty on behalf of the company’s best interest
- To avoid conflicts of interest
- To exercise professionalism as well as utmost care and diligence
- To understand the laws and regulations that impact the business
- To not exploit the power of the position and to support the growth and interests of the company
- To convene any mandatory annual meetings and file the annual returns
- To maintain an accurate and updated record of the Statutory Registers
- To register a local business address
- To report changes or amendments within and about the company
- To provide regular updates about the Register for Directors Shareholdings
Click here for more information on corporate establishment information.