What Is a Shadow Director?
Board directors often ask others for advice on a range of issues related to finance, law, risk, and governance. On occasion, these relationships can cross a line and create the complicated dynamic of having a shadow director. A shadow or de factor director is a person who exercises a high degree of influence on the organisation and/or leads management-related work that would typically be assigned to a Board director.
Having a shadow director can give the impression to a company’s stakeholders, creditors, and employees that the people making decisions are not being transparent.