Chapter 2: Formation, Administration and Dissolution of Companies
Part F: Governance of companies
s66: Board, directors and prescribed officers
- (1) The business and affairs of a company must be managed by or under the direction of its board, which has the authority to exercise all of the powers and perform any of the functions of the company, except to the extent that this Act or the company's Memorandum of Incorporation provides otherwise.
- (2) The board of a company must comprise:
- (a) in the case of a private company, or a personal liability company, at least one director; or
- (b) in the case of a public company, or a non-profit company, at least three directors,
- in addition to the minimum number of directors that the company must have to satisfy any requirement, whether in terms of this Act or its Memorandum of Incorporation, to appoint an audit committee, or a social and ethics committee as contemplated in section 72(4).
- (3) A company's Memorandum of Incorporation may specify a higher number in substitution for the minimum number of directors required by subsection (2).
- (4) A company's Memorandum of Incorporation:
- (a) may provide for:
- (i) the direct appointment and removal of one or more directors by any person who is named in, or determined in terms of, the Memorandum of Incorporation;
- (ii) a person to be an ex officio director of the company as a consequence of that person holding some other office, title, designation or similar status, subject to subsection (5)(a); or
- (iii) the appointment or election of one or more persons as alternate directors of the company; and
- (b) in the case of a profit company other than a state-owned company, must provide for the election by shareholders of at least 50% of the directors, and 50% of any alternate directors.
- (5) A person contemplated in subsection (4)(a)(ii):
- (a) may not serve or continue to serve as an ex officio director of a company, despite holding the relevant office, title, designation or similar status, if that person is or becomes ineligible or disqualified in terms of section 69; and
- (b) who holds office or acts in the capacity of an ex officio director of a company has all the:
- (i) powers and functions of any other director of the company, except to the extent that the company's Memorandum of Incorporation restricts the powers, functions or duties of an ex officio director; and
- (ii) duties, and is subject to all of the liabilities, of any other director of the company.
- (6) The election or appointment of a person as a director is a nullity if, at the time of the election or appointment, that person is ineligible or disqualified in terms of section 69.
- (7) A person becomes entitled to serve as a director of a company when that person:
- (a) has been appointed or elected in accordance with this Part, or holds an office, title, designation or similar status entitling that person to be an ex officio director of the company, subject to subsection (5)(a); and
- (b) has delivered to the company a written consent to serve as its director.
Related Sections
s69: Ineligibility and disqualification of persons to be director or prescribed officer
s72: Board committees
Related Regulations
R38: Prescribed officers of companies
Related Notes
No related note.
Related Forms
No related forms.