business 代写:Directors' Duties under the Companies

2016-11-30 19:59

Executive Summary

This paper explains about the directors’ duties that is implemented in the Companies Act 2006. It is significant that every director have to act within the legal principles in order to prevent any dispute from company’s interest with their personal interest. In the Companies Act 2006, there are several duties that every director has to act with the duties that are provided in Section 171 to Section 177. However, the directors did not put the duties into practice when carrying their responsibility as a director in a company. As a result, it has caused a great impact to many aspects such as employment rate, economy and others.

Question 1

  1. Introduction: Directors’ Duties in Companies Act 2006
In this modern globalization, every company must have at least one director for non-public listed company and at least two directors for public listed company as it had mentioned under the Companies Act 2006 in Section 154 (Davies, 2007). The reason of having a director in each company is to represent the company to act due to the ‘artificial’ legal entities of the company. In a company, the directors are the persons who represents its owners to manage and solve the problems of a company. According to the Cornell University Law School (2015), the directors of a company are called as fiduciaries because they are owing the fiduciary duties of the company while the people who owes the fiduciary duties is called as principal. Fiduciary duty is a legitimate obligation where it act exclusively in another party’s interest, which is the company where the fiduciaries are representing of. In the legal systems of United Kingdom, fiduciary duty is the most rigorous duty of care and duty of loyalty because the fiduciaries have to obey the duty that had implemented to prevent themselves from any irreconcilable circumstances with their principals or with different fiduciaries’ customers. In order to prevent conflict of interest, the Companies Act 2006 has implemented several fiduciary duties to the company’s director that has mentioned in sections