What do non-executive directors do?

Non-executive directors, also known as external directors, refer to directors who have no other contractual relationship with the company except as directors. Non-executive directors play the role of supervision, inspection and checks and balances on executive directors.

As an independent non-executive director, his duty is to supervise the management, participate in formulating the direction of the company's business and affairs, and express positive and objective opinions on the above and other issues faced by the board of directors. In performing your duties, one of the main duties is to ensure that the board of directors considers the interests of all shareholders, not just the interests of a faction or a group.

In some cases, there are exceptions. For example, in the case of acquisition, spin-off, other major transactions, stock repurchase or related party transactions, it is not convenient for one or more directors to perform their duties on the board of directors because of the conflict of roles in this matter, and it is necessary for the board of directors to form an independent team to perform their duties on their behalf.

The difference between executive directors and non-executive directors:

1. The functions and powers of the executive director are stipulated in the articles of association. Provisions on executive directors: Executive directors refer to the necessary institutions for a limited company with fewer shareholders and smaller scale to carry out business and decide business intentions. A limited liability company that meets the statutory requirements may have only one executive director instead of a board of directors, provided that the company has a small number of shareholders and a small scale.

2. Non-executive directors refer to directors who do not hold the position of manager in the company, also known as non-executive directors. They are a kind of directors and a member of the board of directors. Non-executive directors play the role of supervision, inspection and checks and balances on executive directors.

3. Independent directors must be non-executive directors, non-executive directors are not necessarily independent directors, and executive directors must not be independent. Independent directors are independent non-executive directors, but non-executive directors may or may not be independent.

4. Non-executive director is a director who does not hold the position of manager in the company, is a kind of director and a member of the board of directors.