Requirements for becoming the director of a Company

Requirements for becoming the director of a Company

To become the director of a company, there are some conditions which have to be fulfilled by the person who wants to become the director of a company. These conditions to become the director of a company are discussed in this article. One of the most important people in the company is its director. A director of a company is a person who supervises all the activities in the company. There are two types of directors:

  1. Executive directors– Executive directors are the chief executive officers of the company. They can either be a whole team of the director or a managing director. Whole time directors are those directors who devote their complete time in working for the company and they have personal interest towards the company. Whereas managing directors are those directors who have substantial powers over the management as well as affairs of the company. That’s why they are known as the managing directors because they manage complete affairs of the company.
  2. Non Executive directors– They are also called by the name of external directors. They have same duties as well as responsibilities to that of executive directors but they are not a part of employment of the company. They are not treated as the employees of the company. They have the certain responsibility of making strategies as they are present externally towards the company and they know what the factors that can adversely affects companies functioning are.

Every company should have a combination of both executives as well as nonexecutive directors. It should have at least 50% of its non-executive directors.

Requirements to become the director of a company are:

Age limit

To become a director of the company there is no specified age limit. However, sec 157 of the company act provides minimum age to be 21 years. Any person with less than 21 years of age cannot become a director. Doing so will lead to the end of its directorship session.

Nationality of the director

We cannot find any provisions in the companies act specifying the nationality of the director. A person from any nationality can become the director of the company.

Disqualifications of becoming a Director

To become the director of a company, a person must not be disqualified under the Companies Act. As per the provisions of the act, the following persons are disqualified:

  • any person who has not paid its previous returns in any of the preceding years are not entitled to become a director of the company.
  • a person of insolvent mind is not entitled to be a director under the act.
  •  a person in whose behalf any previous criminal case in pending.
  • a person who is not qualified to become a director of the company

Important: an Only individual person can occupy the position of the director of the company. It means that no company can become a director in other company. Only individuals who are qualified as per the provisions of the act can become directors and can manage the affairs of the company.


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