Briefing for directors—general duties under the Companies Act 2006
Briefing for directors—general duties under the Companies Act 2006

The following Commercial guidance note provides comprehensive and up to date legal information covering:

  • Briefing for directors—general duties under the Companies Act 2006
  • Who owes the general duties?
  • What are the general duties?
  • Compliance with the general duties
  • When to comply
  • How to comply
  • The duty to act in accordance with the constitution and properly exercise powers (CA 2006, s 171)
  • The duty to promote the success of the company (CA 2006, s 172)
  • The duty to exercise independent judgment (CA 2006, s 173)
  • The duty to exercise reasonable care, skill and diligence (CA 2006, s 174)
  • more

Every director of a company owes a number of duties to the company they are appointed to. Many of those duties have been developed by the courts over hundreds of years. The main directors' duties are set out in statute in sections 171 to 177 of the Companies Act 2006 (CA 2006).

This briefing is intended to give you, the directors [and the company secretary] of [insert company name] [Limited OR PLC] (the Company) an overview of the general duties set out in the CA 2006 and to provide some practical guidance to help you comply with those duties.

The failure by a director to comply with any of the general duties has potentially serious consequences for that director.

This briefing is not intended to give legal advice, which should be sought on any specific issues that arise in relation to directors' duties.

Who owes the general duties?

Every director of a company owes each of the general duties to that company. Compliance with each of the general duties is the personal responsibility of each director.

Under the CA 2006, any person occupying the position of director, whether or not they are actually named director and or have been validly appointed, is a director of the company and will be subject to the general