Page 17 - Profmark_2024_Directors Guide

DUTIES AND RESPONSIBILITIES OF DIRECTORS

Common Law Duties and Partially Codified Duties (Section 76)
■ Fiduciary duties:
■ to act bona fide in the interests of the company, to exercise powers for their proper
purpose, to exercise independent judgement in decision making and not to use
corporate property information or opportunities for personal gain
■ Duty to disclose any conflict of interest
■ Duty to position and use information for company’s benefit, and not for his own private
advantage or the advantage of any other person other than the company or a wholly owned
subsidiary of the company
■ Duty to disclose material information [unless he reasonably believes the information is
immaterial to the company or generally available to the public or known to other directors
or is bound not to disclose the information by legal or ethical obligation of confidentiality]
■ Section 76(3(c) codifies the duty of care of a director by stating that he has a duty to
perform his duties in good faith, in the best interests of the company and with due care,
skill and diligence that would 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
Duties in Terms of Strategy and Conduct
■ Duty to comply with the Act in relation to different types of companies (Section 8)
■ Duty to comply with the company’s MOI (Section 13, 15 and 16)
■ Duty to manage the business affairs of the company [Section 66(1)]
■ Duty to carry on the business without trading recklessly or under insolvent conditions
(Section 22)
■ Duty to comply with Solvency and Liquidity Test (Section 4)
■ Duty to implement business rescue proceedings if necessary
Duties Relating to Keeping of Records and Audit
■ Duty to keep company records (Section 24)
■ Duty to keep accounting records (Section 28)
■ Duty to provide for the Proper Conduct of Audit or Independent Review where applicable
(Sections 90 & 92)
Duties Relating to the Board,Shareholders and Administration
■ Duty to appoint board committees & an audit committee if applicable (Sections 72 & 94)
■ Duty to appoint a company secretary where applicable (Section 84 & 86)

15