Ltd company director - non shareholder advice needed

[overthinkersanonnymus]

If you're the sole director of a LTD company, but hold no shares in said company, what sort of liability are you exposed to?

A promotion at work has been pitched to me as basically an employee within the company with no risk to me, personally, should anything, or anyone, go rogue in the company. I will also Director and Officer insurance to cover me.

I'm worried about the legalities of the title and my exposure

I'm obviously very naive about this and any advice would be appreciated

Thanks!

I understand if there’s an issue you could end up in court (health and safety breach/injury) for example

You could at worse end up in jail for corporate manslaughter

It doesn't make sense for anyone to do this.

The shareholders have voting rights. There would normally be representation for all shareholders on the board. As a sole director would you have a board of non-exec directors? Who has the power?

What a weird set up. Why aren't the senior officers of the company the executive directors? Are they proposing to set up a subsidiary and make you MD of that?

I would be very wary - not so much about being a director in general, but about being a director in this arrangement.

Has the real owner of the company been disqualified as being a director. If so they will have been disqualified for a reason and therefore I wouldn't be a sole director for their company. You will have a whole raft of responsibilities as a director as well as a fiduciary duty so I would google director's responsibilities and see if it something you are prepared to undertake

Good thought by @Spirallingdownwards . You can search the register of disqualified directors here. I would also definitely look the company up on the main Companies House register, to see who has been a director in the past.

Looks like they need someone to act as a proxy.

I would not do it.

All directors can be liable for things that go wrong in the company, even if it's not your "personal" area of responsibility, so at the very least, you need to ensure you're allowed to participate fully in ALL aspects of the company, i.e. accounting, finance, legal, H&S, product safety, public/employee safety, etc etc. You can't claim a defence of "not my job" if the company kills or injures someone through negligence or trades fraudulently (i.e. deliberately running up debts it can't pay, etc). So you need to be an active participant in ALL board meetings etc. If they won't let you do that, then walk away. Obviously, to take on that extra responsibility and potential liability, you need a whacking pay rise!

Thank you everyone. It's a bloody minefieldfield!