1. What are the major responsibilities of a company director?
A company director has several distinct responsibilities that would include:
Fiduciary Duty: Acting in the best interests of the company and its shareholders.
Duty of Care: Exercising reasonable care, skill, and diligence in their decision-making.
Compliance: Ensuring that the company will comply with all applicable laws, regulations, and its constitution.
Financial Oversight: Superintending over the financial reporting and keeping the company afloat.
2. Can directors be held personally liable for company decisions?
Yes, there are circumstances in which directors may be held personally liable, for example:
Failure to observe fiduciary duties.
Trading while the company is insolvent.
Failure to observe statutory requirements, such as failing to file accurate financial reports.
However, liability is usually restricted if the directors act within their authority and in good faith.
Read Also:
- https://legalsagehub.com/10-questions-answered-about-corporate-compliance/
- https://legalsagehub.com/15-key-questions-about-corporate-liability/
- https://legalsagehub.com/8-questions-entrepreneurs-ask-about-venture-capital-agreements/
3. What is the distinction between executive and non-executive directors?
Executive Directors: Involved in the day-to-day management and operations of the company.
Non-Executive Directors: Provide independent oversight and contribute to strategic decision-making without engaging in the daily operations.
4. What are the implications of breach of directors’ duties?
Severe consequences will result from the breach, such as:
Fines or penalties
Disqualification to serve as a director
Personal liability of the company debts
Damage to personal and professional reputation
5. How do directors comply with their duties?
Directors comply through:
Regular reviewing of the policies and practices of the company
Seeking professional advice when required.
Maintaining records of all decisions with reasoning.
Following relevant legal and regulatory changes.
