Appointment of Directors in Kenya

Who is a director?

A director can be a person or a corporate entity appointed or elected for the purpose of managing the daily affairs of a company. Every registered private company must have at least one director who is a natural person. On the other hand, a public company must have at least two directors one who can be a natural person the other a corporate entity.

Qualifications to be a director

Anyone can be a director irrespective if their nationalities, race and location except for

  • A person who is below 18 years
  • An undischarged bankrupt unless allowed by a court of law
  • A disqualified director by a court of law
  • If a person has been convicted of any offence and has served a period of seven years or more.

How are directors appointed?

Directors can be appointed through a directive of the registrar or an application for directorship by the member.
Appointment through the registrars’ directive
The Registrars of Companies may issue a directive to a company to appoint a director if the company is in breach of the provision by the companies Act.

The direction from the registrar will include:

  • The statutory requirement breached by the company,
  • The action required by the company (to appoint a director(s)),
  • The period within which the directive should be done (one month- 3 months) and
  • The consequences for failing to comply.

Appointment should be in accordance to the company’s articles of association. Further to the directive, a notice of appointment should be issued within the period given by the registrar. If the company fails to comply with the registrar’s directive, then the company and each officer of the company will be charged a fine not exceeding five hundred shillings.

What documents are required for appointment of directors

There are documents that should accompany the appointment of directors. These documents include:

  • A written consent from the director to work in that capacity,
  • A notice of appointment of directors and their particular (CR6)
  • A notice of residential address/change of address of the director (CR 8)
  • Dully signed Board minutes signed stamped by the company secretary if in attendance
  • CR 20 for allotted shares
  • If the proposed director will be getting shares, there is need for the share transfer franked by the bank. It should also have KRA slips.

For Public companies
The appointment will require all the above mentioned documents not forgetting the below documents:

  • A company resolution (CR 19)
  • The secretary to sign stamp a notice for an AGM to appoint the director(s).
  • Financial statements.

Directors are appointed to avoid mismanagement and oppression. They act as an agent for the conduct of the business of the company.