What Information Are Shareholders Entitled To?

Key Takeaways

• Shareholders have specific statutory rights to inspect certain company records, including annual accounts, resolutions, meeting minutes, constitutional documents, and the register of members under the Companies Act 2006.
• Shareholders are not automatically entitled to access company bank account information unless such access has been historically granted or explicitly agreed in a Shareholders’ Agreement.
• If a shareholder has been involved in management or had prior access to financial records like bank statements or payroll, restricting that access may amount to unfair prejudice.
• The scope of a shareholder’s right to company information may be expanded by contractual agreements or historic involvement, especially where there are concerns about wrongdoing.

The position and rights of Directors and Shareholders are different and can vary depending on what has historically been agreed, if anything. 

Shareholders generally have a right to:

1. receive a copy of the company’s annual accounts and reports for each financial year (section 423 Companies Act 2006); 
2. inspect records of resolutions and meetings (section 358 Companies Act 2006);
3. view the constitutional documents of the company listed at section 32 of the Companies Act 2006);
4. inspect the register of members (section 116 Companies Act 2006);
5. receive notice of general meetings (section 310 Companies Act 2006);
6. inspect Directors’ service contracts (section 229 Companies Act 2006); and
7. view any information in the public domain. 

You should check your Shareholder agreement, if any, to see if you have any other special entitlement to information.

The above is a general overview of the position in relation to private limited companies. You may be entitled to much broader information if you have been involved in the management of the business and/or have historically had access to it previously. For example, you might be entitled to payroll information, bank statements and/or records and other financial information. This can all be important and any move to restrict access to such information can indicate some form of wrongdoing that may amount to unfair prejudice.

Directors generally have a right to:

1. inspect the company’s annual accounts and reports for each financial year (section 388 Companies Act 2006.); and
2. inspect the company’s books and other documentation for the purposes of obtaining information required to enable the Director to carry out their functions as Director (Conway v Petronius Clothing Co Ltd (1978).) 

Directors are also officers of a company, and in their capacity as officers, they also owe duties to the company both on a statutory basis (companies act 2006 and beyond), in accordance with the articles of association, as well as implied duties in addition. If a Director is being deprived of access to information and documents there may be important employment law-related issues including whether such restrictions amount to a breach of contract or even unlawful termination.