What is a Nominee Director?
If you’re in the process of starting your company, you probably heard of the option to appoint a Nominee Director for your company. But what exactly is a Nominee Director, and do you need one?
It is a person who is appointed to the board by a shareholder but has little or no involvement in the actual running of that company. A Nominee Director has the same responsibilities as any other Director in the company and still need to act in the best interest of the company and the person who nominated them.
- Act in good faith and with all honesty on behalf of the company’s best interest.
- Attend the mandatory annual general meeting (AGM) and any other board meetings as required throughout the year.
- Sign various documents on behalf of the company as part of its statutory annual filings.
- Depending on the requirement, they may need to be the face of the company by attending meetings with financial institutions for setting up company business accounts.
- Provide anonymity to appointing persons.
Before you decide to appoint a Nominee Director, we would highly recommend you to lay out all your expectations and responsibilities you wish to assign to avoid any misunderstandings in the futures.
Why Might You Need a Nominee Director?
There are various legitimate reasons for using a Nominee Director though the most common reasons would be:
- To keep the identity of the person who wishes to run the business confidential. In this case he is often used in conjunction with a Nominee Secretary and a Nominee Shareholder.
- To comply with the requirement that at least one director is an EEA-resident. Additionally, to fully comply with Irish company law and tax residency rules it is advisable to have this person be an Irish resident director.
If you are looking for more information on service, please do not hesitate to contact us.