ACCA Applied Skills · Corporate and Business Law (Global) · Company directors
Zentra Ltd is a private company whose articles are silent on the method of appointing directors. The company's shareholders want to appoint Mira as a new director. Under the general company law approach in most jurisdictions, who normally has the power to appoint a director where the articles are silent?
The shareholders normally appoint directors by ordinary resolution in general meeting. Where the articles give no other method, the members hold this power. A company secretary or an auditor has no inherent authority to appoint a director.
- AThe shareholders, by ordinary resolution in general meetingCorrect
- BThe company secretary, by written notice to the registrar
- CThe company's external auditor, after reviewing her qualifications
Explanation
Directors are normally appointed by the members by ordinary resolution unless the articles provide another method. The company secretary and the auditor have no inherent power to appoint directors, as the appointment is a matter for the members or the board under the articles.
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