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Difference between shareholder and director in india

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A limited company shareholder is an owner of a company. A limited company director is appointed by shareholders to manage the business on their behalf. Alternatively, lots of different people can take on these roles. To set up a limited by shares company, it must be incorporated at Companies House. If a company is owned and managed by a sole director and shareholder, one person alone will have all of these rights and responsibilities.

SEE VIDEO BY TOPIC: What's the difference between a Director and Shareholder in a Business?

SEE VIDEO BY TOPIC: What Is The Difference Between CEO And MD ?

The Key Differences between Director and Shareholder Decisions

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Ankur Garg. CA Suresh Choudhary. You need to be the querist or approved CAclub expert to take part in this query. Click here to login now. India's largest network for finance professionals. Toggle navigation Login Login Register. Home Experts Corporate Law.

Share on Facebook. Share on Twitter. Share on LinkedIn. Share on Email. Share More. Plez Tell me the diff. Ankur Garg Expert Follow. They act as representative of share holders of the company. Normally there is no difference between member and shareholders except certain situations. So, a person to be a member has to hold shares and the name of such person has to be entered on the register of members, kept by the company pursuant to section of the Companies Act, and such company obviously must be a company limited by shares, or by guarantee but having a share capital or an unlimited company where capital is held by indefinite shares.

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Director vs Shareholder and the Types of Directors

Ankur Garg. CA Suresh Choudhary. You need to be the querist or approved CAclub expert to take part in this query. Click here to login now.

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In a Private Limited Company, the shareholders are the owners and directors are the managers. Hence delegation of work among members and owners is important. So the directors are appointed to manage the company. At the time of incorporation of the company , it is easier to own and manage the company. But later, the owners need the help of experts to manage the company.

How the role of director and shareholder is different in a Private Limited Company

The information contained in this article is for information purposes only and is not intended to constitute legal advice. If you require further information or advice in relation to any corporate matters our corporate team at Greenaway Scott would be more than happy to assist you. Directors and shareholders each have very distinct roles within a company. It is often thought that shareholders have little or no control over a company, despite being the owner of the shares. This is a common misconception as shareholders have various decision making powers within a company. Here, Greenaway Scott considers looks at the distinct roles directors and shareholders play in a company. Directors have the responsibility of managing the company on behalf of the shareholders.

What is the difference between shareholders and directors?

When we talk about a company, the terms shareholders and members are commonly used as synonyms, as one can become a member of the company, except by way of holding shares. In this way, a member is a shareholder and a shareholder is a member. The statement is true but not completely, as it is subject to certain exceptions, i. Likewise, there are a few more points of difference between member and shareholder which are elaborated in the article in a detailed manner. Basis for Comparison Member Shareholder Meaning A person whose name is entered in the register of members of a company, is the registered member of the company.

Services provided by our parent company Company Law Solutions. Shareholders and directors have two completely different roles in a company.

Many people get confused about the distinction between director vs shareholder. A shareholder owns or holds shares issued by a company. For example, public companies have annual general meetings in which shareholders can vote on certain matters. A director is defined in the Companies Act as a member of the Board of the company.

Difference Between Members and Shareholders



Diff. between Member, Director and Shareholder


Jul 2, - Many people get confused about the distinction between director vs shareholder. Both have control over their companies, but in very different.








Comments: 2
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  2. Zolojind

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