Jurisdiction(s):
United Kingdom

Related legal acts

Key definition

Directors definition

What does Directors mean? directors are the individuals who, acting as the company’s board, manage the company’s business and make decisions for it. They set strategy, authorise significant transactions and oversee compliance, often delegating day-to-day operations to executives but retaining ultimate responsibility. In England & Wales, Scotland and Northern Ireland, the Companies Act 2006 defines a director broadly to include anyone occupying the position (including de facto and shadow directors). Ireland’s Companies Act 2014 adopts a similar definition. Directors act collectively through board meetings or written resolutions and may bind the company within their actual or apparent authority. Key legal features include statutory and fiduciary...

Unapproved credit transactions benefiting directors and connected persons under the Companies Act 2006: voidability, liabilities and statutory defences

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Practice notes

Consequences of not obtaining members’ approval for credit transactions under the Companies Act 2006

The Companies Act 2006 (CA 2006) sets out what follows if a company fails to secure the necessary members’ approval for credit arrangements made for the benefit of Directors, persons connected to directors, and associated arrangements. For more on when members’ consent is required, and on key transitional provisions, refer to Practice Note: Credit transactions for the benefit of a director, a connected person and Related arrangements—requirement to obtain members’ approval. For these statutory Rules, ‘director’ embraces anyone occupying the role of director, whatever the title, and includes a Shadow Director. Where the company entering into the credit transaction has its equity shares listed in the equity shares (commercial companies) category, the UK Listing Rules (UKLR)—notably UKLR 8 on related party transactions—may apply (see Practice Note: Equity shares (commercial companies) listing category—key continuing obligations). For in‑depth commentary on loans to directors and related dealings, see Loans and related transactions [17]–[25]: Gore‑Browne on Companies, and for additional commentary regarding the obtaining of members’ approval, see Common Matters Regarding Member Approval: Gore‑Browne on Companies...

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Web page updated on 21/05/2026

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