Explanation:
Directors only receive a salary if the constitution of the company explicitly allows it. This statement is accurate because the remuneration of directors is governed by the constitution of the company. A director is entitled to receive a salary only if they have a contractual right to remuneration. The board of directors has the power to award contracts to directors and other personnel, but this is subject to the company's articles.
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Q.59 The remuneration of the board of directors is a critical aspect of corporate governance, influencing the board's ability to effectively oversee and guide the company. Which of the following statements about the board of directors' remuneration is correct?
A
Directors may award themselves such salary payments as they think fit
B
Directors must receive a salary, just like other junior employees of the company
C
Directors only receive a salary if the constitution of the company explicitly allows it
D
Directors salaries are set by the HR department of the firm
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