- The answer is found in section 76 of the Companies Act. It is thus save to conclude that directors’ duties are partially codified by law.
- It is indeed correct that in this section “director” includes an alternate director, and a prescribed officer; or a person who is a member of a committee of a board of a company, or of the audit committee of a company, irrespective of whether or not the person is also a member of the company’s board.
- It is trite law that a director of a company must not use the position of director, or any information obtained while acting in the capacity of a director —
(i) to gain an advantage for the director, or for another person other than the company or a wholly-owned subsidiary of the company; or
(ii) to knowingly cause harm to the company or a subsidiary of the company; and
- communicate to the board at the earliest practicable opportunity any information that comes to the director’s attention, unless the director —
(i) reasonably believes that the information is immaterial to the company; or generally available to the public, or known to the other directors; or
(ii) is bound not to disclose that information by a legal or ethical obligation of confidentiality.
- A director of a company, when acting in that capacity, must exercise the powers and perform the functions of director in good faith and for a proper purpose; in the best interests of the company; and with the degree of care, skill and diligence that may reasonably be expected of a person carrying out the same functions in relation to the company as those carried out by that director; and having the general knowledge, skill and experience of that director.
The contents of this article is intended to provide a general overview to the subject matter and is not exhaustive. Specialist advice must be sought about your specific circumstances – 04 March 2019.