ROLE OF A DIRECTOR

The role of a director of the company are as stated below:-

ACT WITHIN POWERS

You must act as a director and in accordance with the company’s constitution, and only exercise your powers for the purposes for which they were given.

PROMOTE THE SUCCESS OF THE COMPANY

You must act in the way you consider, in good faith, would be most likely to promote the success of the company for the benefit of its members as a whole.

This is a key duty and is often the focus of discussions around directors’ duties. It is typically referred to as the “section 172 duty”.

EXERCISE INDEPENDENT JUDGMENT

You must exercise independent judgment and make your own decisions.

This does not prevent you from acting in accordance with the company’s constitution or an agreement which the company has entered into. This does not prevent you from taking professional advice but if you do, you should use your own judgment as to whether to follow it.

EXERCISE REASONABLE CARE, SKILL AND DILIGENCE 

You must exercise the same care, skill and diligence that would be exercised by a reasonably diligent person with:

• the general knowledge, skill and experience that may reasonably be expected of a person carrying out the same functions as you in relation to the company
• the general knowledge, skill and experience that you actually possess.

AVOID CONFLICTS OF INTEREST 

You must avoid a situation in which you have, or could have, an interest that conflicts, or may conflict, with the interests of the company. 

This duty applies, in particular, to the exploitation of any property, information or opportunity, regardless of whether the company could take advantage of it.

DECLARE INTERESTS IN PROPOSED OR EXISTING transactions or arrangements with the company

If you are in any way, directly or indirectly, interested in a transaction or arrangement with the company, you must declare the nature and extent of that interest to the other directors.