Responsibilities of a Nominee Director
1. Act in the best interest of the company
A company director must exercise their power in the best interest and good faith of the company. This means that the director must always exercise decisions whilst considering the long-term effects it may have on the company. He/she must ensure the interests and relationships of the company stakeholders are well maintained., and that the company does not violate the Companies Act, the company’s constitution, or any legal or official regulations.
2. Reliance on information from others
The director of the company can rely on the information provided by other stakeholders when performing his duty as a director. This can be information provided by an employee of the company who has relevant experience on the subject matters, or another director. He/she may also choose to rely on externally appointed experts or professionals. Some companies also form a committee consisting of people with different backgrounds, to provide the director with insights when needed.
3. Responsibility for the action of the delegate
If a director chooses to delegate any power on the board to another director, employee, external expert, or committee, the director could then discharge his duty if there is reasonable assurance to support that the delegate will be able to exercise power and his duty competently.
4. Responsibility for implementing a system of internal control
If the Malaysian Company is a Public Limited Company or a subsidiary of a listed company, the director will also ensure the company has implemented a reliable internal control system. This serves to safeguard the company’s assets and allow it to operate without harming the stakeholders.