Board composition can be the single most important governance factor determining an organisation’s future success. Foreign-owned companies starting up in South Africa frequently take up professional director services as a short-to-medium-term option. Putting a professional director in place can not only reduce the time, risk and legal exposure of the set-up process, it should also ensure that all regulations are being, and will be, followed diligently.
Sovereign can assist both South African and overseas (‘offshore’) companies. A company, trust or similar entity is deemed to be a resident if it is incorporated, established, formed or has its place of effective management in South Africa.
Most onshore countries have similar provisions within their tax legislation so it is rarely advisable for onshore resident clients to act as the directors of an offshore company. To establish that the management and control of the company does take place offshore and the company is therefore tax resident offshore as well as incorporated there we can, and habitually do, provide directors. In most cases this service is essential if legitimate tax savings are to be made.
Sovereign’s professional directors are experienced and knowledgeable individuals, who understand the needs of private and commercial structures. Before any of our directors can be appointed, we need to have a thorough and comprehensive understanding of the company and its business, as well as the reason that our services are required.
Our professional directors are required to meet their directors’ duties, which require them to exercise independent judgment. It is a condition of any appointment that the director(s) are able to exercise their independent judgement and are fully involved in any decision.