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Swiss companies board of directors’ duties and responsibilities

Der Verwaltungsrat einer Schweizer Firma hat Pflichte und Rechte

The Company Act in Switzerland regulates the founding of corporations or companies in Switzerland. In all Swiss corporations or stock companies, having a board of directors is always mandatory.

The company’s stockholders select each member of the board of directors via resolution. This appointment is done in a special meeting with the shareholders of the business. Furthermore, the appointment of the board of directors in a Swiss company entails the use of the Swiss Code of Obligations (CO) that serves as the primary governing framework in terms of such process.

Basic Provisions for Company Directors

As far as Swiss company directors or CEOs are concerned, certain provisions are imposed. The two fundamental requirements to be complied to are as follows:

  • For a corporation with limited liabilities, the appointed CEO must be a legitimate resident of Switzerland.
  • For a stock company, the board of directors or at least its majority must be residents of Switzerland.


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Non-transferrable duties and responsibilities of the board of directors of a Swiss Limited Ltd. (Joint-stock company in Switzerland)

Quite obviously, those who are considered to be directors of the company are regarded to be trustworthy individuals who would stay loyal to the company no matter what. In other words, they stand as representatives of the company. Furthermore, promoting what is best for the company and its stakeholders is the core responsibility of the board of directors. See also our current list of our Shell or Shelf Companies

Next thing to be done is specifying the director’s tasks and obligations. It is the Swiss Commercial Law that takes charge in instituting these duties and responsibilities. The following information may also be found in the company’s Articles of Association.

  1. Management. Members of the board of directors, or the CEO by default, oversee the management of the company. As managers, the CEO has autonomy and authority in making pertinent decisions for the company.
  2. Strategic Planning. The board of directors conceptualizes plans and strategies that are both effective and favorable to the company and shareholders in the long run.
  3. Organization. The board is responsible for structuring the company’s organizational board. He appoints other managers, directors and/or committees. Likewise, the board must also determine, endorse and establish the organization’s rules and regulations.
  4. Accounting, financial planning and supervision. Aside from the crucial responsibility of doing financial accounting and preparing financial statements, supervising the overall liquidity and accounting system of the company are also the duties of the Swiss board of directors.
  5. Selection and Elimination of Executives. Just like what managers do, the board also has a command in terms of allocating tasks and positions to lower leaders. The board must be extra careful when entrusting roles. In cases when failures are committed and those persons appointed by the board neglect their duties, the board may then remove them from the position.
  6. Supervision of Operation. In Swiss companies, the board of directors must continuously oversee the company’s operations in all areas like management, finances, human resource, and policies among others to make sure that every aspect of the business is carried out smoothly. If discrepancies occur, the board is responsible to construct and implement suitable solutions. Finally, as part of supervision, the board of directors must organize meetings at least four times in a year and prepare annual reports.
  7. Reporting on the company’s debts or insolvency.

While Swiss directors execute these obligations, however, their position entitled them to certain accountabilities, which means that they can also be held liable by law if ever they themselves commit violations and criminal acts. The bottom line is: Swiss company directors must, in one or another, stick their duty of loyalty and work for the company’s best interest.

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