DUTIES OF COMPANY BOARD OF DIRECTORS
A company's Board of Directors (the "Board") has a significant impact on whether it succeeds or fails
DUTIES OF COMPANY BOARD OF DIRECTORS
A company's Board of Directors (the "Board") has a significant impact on whether it succeeds or fails; successful companies typically have strong Boards as their leadership. A company's board of directors is in charge of providing entrepreneurial and strategic direction and acts as a liaison between shareholders, investors, and the company.
The Companies and Allied Matters Act 2020 governs how board meetings are conducted in Nigeria. The Nigerian Code of Corporate Governance 2018, published by the Financial Reporting Council of Nigeria (the "Code"), which outlines recommended practises for all companies operating in Nigeria, including startups, is another source of guidance for boards (the "Company").
Without limiting the company's Articles and Memorandum of Association, CAMA also specifies the responsibilities of directors in a company. Director responsibilities are outlined in Section 279 of the CAMA.
The followings are the duties of Company Directors:
A director shall act in the best interest of the company so as to preserve its assets, further its business and promote the purposes for which such company was formed.
A director shall also act with utmost good faith and shall owe a fiduciary relationship when acting as agent of a particular shareholder or such shareholder is dealing with the company’s securities.
A director of a company stands in a fiduciary relationship towards the company and shall observe the utmost good faith towards the company in any transacton with the company or on the companies behalf.
A director must exercise his/her powers for the purpose to which it was specified.
The director in performing his/her duties shall act to provide the interest of the company’s employees and the company’s members.
A director shall not fetter his discretion to vote in a particular way.
A director who delegates his powers shall not delegate such power in such a way as to amount to an abdication of duty.
No provision shall relieve any director from the duty to act in accordance with this section or relieve him from any liability incurred as a result of any breach of the duties conferred on him.
All duties imposed on a director by the act shall be enforceable against the director by the company.
In conclusion, the articles of association and the director's function in the management of the company must be taken into consideration when determining whether the director's responsibility has been met.
NB: This article is not a legal advice, and under no circumstance should you take it as such. All information provided are for general purpose only. For information, please contact chamanlawfirm@gmail.com
WRITTEN BY CHAMAN LAW FIRM TEAM
EMAIL: chamanlawfirm@gmail.com
TEL: 08065553671, 08024230080