Chapter 7 Self-test questions

. Regarding the s 250 description of a 'director', which one of the following statements is correct?

Nominee directors do not fall within s 250.

Only de jure directors fall within s 250.

Only de facto directors fall within s 250.

A person whose job title states that they are a director will be a director.

Only executive directors fall within s 250.

A person need not be called a director in order to fall within s 250.

. A person who has been validly appointed as director is known as?

A de facto director.

A de jure director.

. Which one of the following statements is false?

A person giving advice in a professional capacity will not be a shadow director.

A body corporate cannot be a shadow director.

The mere giving of instructions will not make a person a shadow director.

A person will not become a shadow director the first time they instruct/direct the directors.

A person will only be a shadow director if a majority of the board follows his instructions or directions.

A person can openly be a shadow director.

A person exercising a function conferred under statute will not be a shadow director.

. Can a person be a de facto director and a shadow director?

Yes.

No.

. Which one of the following is not a valid difference between an executive director and a non-executive director?

Executives are typically full-time, whereas NEDs are part-time.

Executives are usually employees, whereas NEDs are usually not.

Executive typically earn a lot more than NEDs.

The executives manage the company, whereas the NEDs have no managerial role.

. Which one of the following statements is not stated in the UK Corporate Governance Code?

At least half the board (excluding the chair) should consist of independent NEDs.

One of the independent NEDs should be appointed as the senior independent director.

A NED who has been an employee of the company within the past five years will not be regarded as independent.

The NEDs' role is to provide constructive challenge, strategic guidance, offer specialist advice, and hold management to account.

. Which one of the following statements is false?

A person can only be appointed as an alternate director if they are not already a director of the company.

A director can only appoint an alternate to act in his place if the articles allow for this.

An alternate director is not entitled to be remunerated unless the articles so provide.

An alternate director will not be an agent of the director who appointed him if the articles so provide.

. A nominee director's primary duty is to?

The member who nominated him.

The creditor who nominated him.

The company.

The other directors.

. Which one of the following statements is false?

A director can only be appointed as CEO if the articles empower the directors to make such an appointment.

A person does not acquire any additional powers simply by virtue of being appointed as CEO.

The role and powers of a CEO are not defined in statute.

The model articles expressly allow the directors to appoint one of their number as CEO.

. Regarding the chair of the board, which one of the following statements is false?

A company must appoint a chair.

The model articles provide that the chair of the board shall also chair general meetings.

The UK Corporate Governance Code provides that the chair should be independent on appointment.

The model articles provide that the directors can appoint a chair.

The UK Corporate Governance Code provides that the chair leads the board.

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