Director search: know who’s behind the companies you work with

As a business owner, it’s important to know who’s behind the companies you work with. Having the right information helps you make better decisions and protect your business from risks like late payments or supply chain issues. One way to stay informed is by conducting a director search. This article explains what you can learn about a director and how to carry out the search.  

What is a director search?

A director search involves looking into the background of a company’s leadership, specifically its directors. Directors make key decisions and guide a company’s direction. Who the director of a company is will play an important role in a business’s success or failure. By learning about a director’s background, you can better understand their experience, financial skills, and reliability.

What can director searches tell you about the businesses you work with?

Directors have a direct influence on how a business operates. Their experience can indicate whether a company is likely to succeed or face challenges. For example, a director search can help you assess:

• A director’s creditworthiness
  You can assess their creditworthiness by reviewing their past business experience. This helps determine if they are likely to meet financial commitments, such as paying invoices on time. This is essential to consider when extending credit or establishing a long-term working relationship.

• The risk of bad debts
  A director's past can reveal how they manage finances, so it's important to consider this before forming a partnership. If a director has a history of unpaid debts, it shows a financial risk. If they worked with companies that didn't pay their bills, this is also a warning sign. 

• The success of the business
  If a director has successfully managed other companies, their current business is likely in good hands. However, if a director has been involved with one or several failed ventures, it can indicate deeper issues.

By doing a director search, you can see if you are working with someone who can manage finances well and responsibly.

What should you look out for when doing a director search?

During a director search, it’s important to keep an eye out for certain red flags. These could include:

• CCJs or unpaid debts on the business
  If a County Court Judgment (CCJ) has been issued against a business or its director, it’s a serious red flag. This could point to financial instability, which might affect your dealings with that business.

• Unpaid debts personally
  If a director has personal debts hanging over them, it might indicate poor financial management. If they can't manage their personal finances well, it may also affect the businesses they run.

• History of insolvency
  If a director has connections to several businesses that failed, it’s important to consider the consequences. This might indicate a pattern of poor financial decision making, or risky ventures.

Spotting these red flags can help you protect your business cash flow by avoiding working with businesses that might not pay their debts.

How to search for the director of a company

There are different ways to search for information about a company’s director. Two common ways are to check the company’s business credit profile, or to search the director on Companies House.

Checking business credit profiles

With Capitalise for business you can see the full Experian business credit profile of any UK limited company. A business credit profile can provide you with detailed information about a company and its directors, this includes:

• The current active directors of the company and when they were appointedThe business structural and operational data and whether this positively, negatively or neutrally influences the business credit profile.

• The directors’ commercial experience to see how the track record of the business’ management affects the company's creditworthiness.

• Any negative directors’ commercial experience, which will be flagged as a negative risk factor on the business’ credit profile.

• Whether any directors are also listed as shareholders.

• ​​​​​​​The company’s financial performance and health to assess the impact a director has had. 

With this information, you can assess a company’s financial performance and understand the impact the director may have had on its past success or challenges.

Searching for a director on Companies House

For more information, you can also check public records and search for a director through Companies House. This will provide key details about directors, including:

• Full name and date of birth (month and year only)

• Nationality

• Appointment date 

• Resignation date (if applicable)

• The director's current status in the company (active, or resigned)

• Whether they have control in a company, for example if they have a percentage of share ownership

• Occupation

• Any past and present directorships with other companies.

• Correspondence address (this is usually not their residential address and may be a registered office).

Looking for more detail?

You can learn more about a director by checking their LinkedIn profile. It shows their experience, skills, recommendations, and how others see them. The company’s website can also provide details about the director’s role and leadership style, helping you understand their vision for the company and how it might affect your business.

By taking the time to conduct a thorough director search, you’re taking steps to protect your business. 
To get started assessing the credit profiles of other businesses, sign up and create your free Capitalise for Business account today.