Q.Who is a Shadow Director ?
You're viewing a preview — the full solution, concept, methods & PYQ mapping are locked.
Start your 14-day free trial to unlock the full solution →A shadow director is a person, though not officially appointed a director, on whose directions the Board is accustomed to act; the Companies Act, 2013 treats him as an officer in default.
The idea of a shadow director is studied in the Company Management chapter of the Tamil Nadu HSC Class-12 Commerce syllabus and deals with people who really control a company without holding the formal post.
Meaning: A shadow director is a person who has not been formally appointed as a director of a company, but in accordance with whose directions or instructions the Board of Directors is accustomed to act. In other words, he controls the Board from behind the scenes.
Key points:
- He is not officially named as a director, yet he effectively directs the affairs of the company.
- Since he exercises real control, the Companies Act, 2013 [Section 2(60)] treats such a person as an 'officer who is in default', making him liable for defaults like a director. …
Unlock everything free for 14 days
- Full step-by-step solutions
- Concept-first explanations
- Methods, shortcuts & mistakes
- PYQ mapping + timed mock tests
Full access for 14 days. No credit card required.