Understanding these roles helps you make better decisions about ownership, control and liability.
Who is a partner (shareholder)?
A partner invests money (or other assets) into the company and receives shares in return. In exchange, the partner may receive dividends when the company makes profit.
- a partner owns part of the company
- has voting rights at the general meeting
- does not necessarily work in the company
Who is a director?
A director is responsible for the day-to-day management and the strategic decisions of the company.
Directors act in the interest of the company, not only in their own personal interest.
- signs contracts
- represents the company externally
- ensures that legal obligations are fulfilled
Can one person be both?
Yes. In many small companies, the same person is both partner and director. That is perfectly allowed, but it is important to understand when you act in which capacity.
Liability: where are the risks?
In principle, shareholders risk only their invested capital.
Directors, however, can become personally liable if they manage the company negligently, ignore legal obligations or act in bad faith.
Example: failing to file annual accounts or not paying social debts on time can lead to director liability in certain situations.
Remuneration
A shareholder earns via dividends. A director usually receives remuneration (salary) for their work.
The right balance depends on tax planning and the financial needs of the company.
My advice
Before accepting a director role, make sure you understand the responsibilities attached to it.
During a consultation, we review:
- who should be shareholder
- who should take on the director role
- how to limit personal risk
- how remuneration can be structured