What Is A Shadow Director?

In many circumstances, the law applies not only to a director of a business, but also to a shadow director.

A shadow director is a person in accordance with whose directions or instructions the directors of a company are accustomed to act. Under this definition, it is possible that a director, or the whole board of a holding company, and the holding company itself, could be treated as a shadow director of a subsidiary.

A founder or significant shareholder who wishes to escape the disclosure requirements of a directorship might still be counted as a shadow director and held responsible for their actions as if he/she were a formal director.