Adding Directors to CIC

Didn't find your answer?

This maybe more of a legal question so apologies if that's the case.

I've been asked to look into adding a couple of Directors to a CIC as the two current Directors feel they don't have enough impact when it comes to applying for funding, grants etc.  They don't want the additional directors to have any control over the CIC but will have regular meetings and keep them informed. If it was a shreholder agreement I would imagine it would be a 40/40/10/10 split.  

Is it a case of adding the two new Directors to CH and an amendment to the articles of Association or would they need to have a legal agreement. The current Directors would remain as PSC's 

 

 

Replies (7)

Please login or register to join the discussion.

avatar
By SkyBlue22
23rd Feb 2023 13:45

Why do they have to be directors? Can't they employ someone to grant write for them?

Thanks (1)
Replying to SkyBlue22:
avatar
By legerman
23rd Feb 2023 16:15

SkyBlue22 wrote:

Why do they have to be directors? Can't they employ someone to grant write for them?

They are under the impression that having more Directors will be viewed more favourably, but from your post you're suggesting it shouldn't be a hindrance? I'll suggest the grant writer option to them, thanks.

Thanks (1)
Replying to legerman:
RLI
By lionofludesch
23rd Feb 2023 16:43

legerman wrote:

They are under the impression that having more Directors will be viewed more favourably......

They might be right. Though that's an issue I couldn't comment on.

Thanks (0)
RLI
By lionofludesch
23rd Feb 2023 16:09

Even if they're directors, they don't have to be shareholders.

I dunno - I'm not sure what the obstacles are. As Skyblue says, there's no need for them to be directors - just senior managers who are invited to attend Board meetings.

Thanks (1)
Replying to lionofludesch:
avatar
By legerman
23rd Feb 2023 16:21

lionofludesch wrote:

Even if they're directors, they don't have to be shareholders.

I dunno - I'm not sure what the obstacles are. As Skyblue says, there's no need for them to be directors - just senior managers who are invited to attend Board meetings.

Thanks, just something I was asked to look in to. They're probably looking at it the wrong way given that you and Skyblue suggest the number of Directors shouldn't be an issue. It's a CIC, so no shareholders.

Thanks (0)
Replying to legerman:
RLI
By lionofludesch
23rd Feb 2023 16:46

legerman wrote:

It's a CIC, so no shareholders.

Nothing to stop a CIC having a share capital. They don't have to be guarantee companies. CICs have a dividend cap - which wouldn't be needed if they weren't allowed to have shares.

Thanks (0)
Stepurhan
By stepurhan
23rd Feb 2023 18:56

If these individuals become directors, they will have powers in respect to the company as well as responsibilities.

If the current directors don't want them to "have any control over the CIC", then I think it doesn't sound like a good plan for either side. As an individual I wouldn't want the responsibilities without some level of control. As the company, I wouldn't want to grant powers without a good reason.

Thanks (1)