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Duties of the company director

Directors are in charge of the management and control of the company. They take decisions for and act on behalf of the company, usually during board meetings. These decisions are logged in board minutes or in a resolution signed by all the directors of the company.

The appointment of directors, other than the first directors, will typically be regulated by the Articles of Association of the company. However, where the Articles fail to make any mention on this point, the Companies Act provides for their appointment accordingly.

The directors of a company owe their duties to the company.

Duties of Directors:

  1. To act honestly and in good faith in the best interests of the company;
  2. To promote the well-being of the company;
  3. To be responsible for the good governance of the company and its proper administration and management;
  4. To be responsible for the general supervision of the company’s affairs;
  5. Directors are obliged to exercise the degree of care, diligence and skill as would be reasonably expected of a person carrying out the functions entrusted to the director and having the director’s knowledge, skill and experience;
  6. Not to make secret or personal profits from their position, or from confidential company information;
  7. To ensure that the director’s personal interests do not conflict with those of the company;
  8. Not to use any property of the company for the director’s own or anyone else’s benefit;
  9. Not to obtain any benefit from exercising the director’s powers, except as permitted;
  10. Not to misuse the director’s powers or act ultra vires.


The Companies Act also imposes other duties, such as:

  1. Keeping statutory registers and minute books;
  2. Filing of returns and documents;
  3. Attending and voting at board meetings;
  4. Record-keeping and financial statements;
  5. Liquidation of the company.


Personal liability of the directors for any breach of duty is joint and several. However, some exceptions may apply: where a particular duty has been entrusted to one or more directors, only such director or directors shall be liable for damages.

Also, a director shall not be liable for the acts of his co-directors if he proves that he did not know of the breach of duty before or at the time of its occurrence and that on becoming aware of it after its occurrence, he signified forthwith to the co-directors his dissent in writing; or knowing that the co-directors intended to commit a breach of duty, he took all reasonable steps to prevent it and to accurately and properly record that such steps have been taken.

The exceptions are not relevant in an action for wrongful trading or where fraudulent behaviour is involved.