This question is in response to a question posted. We are assuming that the question is in relation to a private company.
The company may wish to remove the director from the company’s board due to the following reasons:
- Poor personal conduct
- A breach of the director’s duties
- Poor performance
Thus if the director did breach his duties, he can be removed from the company’s board. However, only the shareholders can remove a director from the company’s board.
Based on section 152 (9) of the Companies Act:
Subject to any provision to the contrary in the constitution, a private company may by ordinary resolution remove a director before the expiration of his period of office notwithstanding anything in any agreement between the private company and the director.
This means that a simple majority (more than 50 per cent of the votes) is required in a general meeting of the shareholders to pass this ordinary resolution. This is of course in accordance with the model constitution. If the company is using a custom constitution then we will need to refer to that constitution to see how a director should be removed from the board. If the company is adopting the model constitution, then the director may be removed by ordinary resolution with at least 14 days notice.
Some companies may also include in its constitution a clause that governs the removal of directors in certain situations like in the event of immoral conduct or terminal illness. In these cases, a vote by the shareholders may not be required. The notice period of the outgoing director may also be drafted into the constitution.
When in doubt, seek legal advice or consult an experienced ACRA Filing Agent.
The editorial team at Singapore Secretary Services
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