In terms of the Companies Act, a director may be removed from office by, among others:
- The shareholders of the company;
- The board of directors of the company;
- In some instance by the Companies Tribunal.
Removal by Shareholders
In terms of Section 71 of the Act, a director may be removed by the shareholders of the company at a shareholder’s meeting.
Removal of a director by the board of directors
The board of directors may only remove a director by resolution where a company has more than two directors, this occurs in the circumstances mentioned below:
- where a shareholder or director has become ineligible and/or disqualified to be a director.
- where a shareholder or director has become incapacitated to the extent that he/she is unable to perform his/her duties.
- where a shareholder or director has neglected or has been derelict in the performance of his/her duties.
Removal by Companies Tribunal
In instances where a company has less than 3 directors, the matter must be referred to the Companies Tribunal by any director or shareholder of the company.