LEGAL AND BUSINESS

ENVIRONMENT.

POSITION OF DIRECTORS.

PROF.MUHAMMED MUNTAQHEEM.G

AMULYA.A
4BD18MBA05
 DIRECTORS AS AGENTS
 The company being an artificial person
cannot manage its affairs itself but the
management of the company is entrusted to
some human agency known as directors.
They are the selected representatives of the
shareholders. They run the business on
behalf of the shareholders and may be
termed as the agent of the company.
 Directors act behalf of the company acting
behalf of the company make the company
liable and not the directors.
 Like agents directors should conduct
business of the company with care , skill and
diligence.
 They are accountable for all of company’s
assets under their control and the profit
from the assets of the company.
 DIRECTORS AS MANAGING
PARTNERS
 Directors have been described as the
managing partners because they represent
the shareholders to conduct the business of
the company on their behalf.
 They perform various functions which are in
the nature of proprietary such as
 Allotment of shares
 Raising of loans
 Investment of funds of the company.
 Unlike partners directors cannot bind other
shareholders by their dealings and dissimilar
to partners directors are elected and
subjected to retirement also.
 DIRECTORS AS TRUSTEES
 Directors act as trustees for the assets and
properties of the company , in addition to
being an agent they also act as trustees
 They must account for all the moneys over
which they exercise control.
 They must exercise their powers honestly.
 Directors are those persons selected to
manage the affairs of the company for the
benefit of shareholders.
 DIRECTORS AS EMPLOYEES
 A person holding the position of a director
shall be in full time employment of the
company and hence , can be called as an
employee.