MOD003379 Legal Aspects of Business: Director's Duties Presentation
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This presentation delves into the legal duties and responsibilities of a company director, focusing on their role in managing a company and promoting its success. The presentation covers several key areas, including the duty to act honestly, promote the company's success for shareholders, employees, and other stakeholders, and act within their powers. It also examines the importance of independent judgment, avoiding benefits from third parties, implementing legal obligations, and keeping accurate accounting records. A significant portion of the presentation is dedicated to the duty to avoid conflicts of interest, as outlined in section 175 of the Companies Act 2006. The presentation emphasizes the importance of directors understanding and adhering to these duties to ensure the company's legal compliance and ethical conduct. The provided presentation offers a comprehensive overview of these crucial aspects of business law.

LEGAL ASPECTS OF
BUSINESS
BUSINESS
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Table of Contents
Duty of director of a company....................................................................................................1
Duty to avoid conflicts of interest (section 175 Companies Act 2006)......................................2
Duty of director of a company....................................................................................................1
Duty to avoid conflicts of interest (section 175 Companies Act 2006)......................................2

Duty of director of a company
Director of a company hold responsibility towards management of their company. They
are required to act honestly and further promote success of organisation as well as benefits in
front of their shareholders (What are the Duties and Responsibilities of a Company Director?.
2018). In addition with this, it has been identified that director of company have responsibility
towards trading partners, company's employees and the state. Along with this, by being a director
they have wide power that significantly aid them to promote the company. Mentioned below
duties of directors is being defined:
To promote the company's success:
It is essential for a director to act in a manner as to further demonstrates good faith within
organisation and promote entity success for shareholders as whole. In addition with this, director
also hold the responsibility to act in the interests of organisation employees. Further director
perform the role related to fostering business relationships with its customer, suppliers and other.
Director also act in fairly manner among members of organisation.
To act within their powers:
Director have the duty related to act in accordance with organisation constitution and
further only exercise their power for the purpose. (Trad and Kalpić, 2019) In addition with this, it
has been identified that directors of an organisation are required to exercise their power as per
according to organisation constitution that include agreements of a constitutional nature and
association and resolution. According to the case law of Regal (Hastings) Ltd v Gulliver [1942],
it has been identified that directors as well as officers are taking advantage in personal manner
from corporate opportunity that violates their duty. Thus, it has been evaluated that directors
must utilize their power in best effective interests of organisation as per according to entity's
constitution.
To exercise independent judgement:
It is essential for directors to exercise decision making process by considering
independent judgement (Bulat, 2019). It is important for directors to not subordinate their
powers to other. While they can ask for professional advices if there is need.
Not to accept benefit from third parties:
It is essential for directors to effectively promote business success and does not accept
benefits in form of bribe from any third party. Thus, it is one of the most essential duty which are
1
Director of a company hold responsibility towards management of their company. They
are required to act honestly and further promote success of organisation as well as benefits in
front of their shareholders (What are the Duties and Responsibilities of a Company Director?.
2018). In addition with this, it has been identified that director of company have responsibility
towards trading partners, company's employees and the state. Along with this, by being a director
they have wide power that significantly aid them to promote the company. Mentioned below
duties of directors is being defined:
To promote the company's success:
It is essential for a director to act in a manner as to further demonstrates good faith within
organisation and promote entity success for shareholders as whole. In addition with this, director
also hold the responsibility to act in the interests of organisation employees. Further director
perform the role related to fostering business relationships with its customer, suppliers and other.
Director also act in fairly manner among members of organisation.
To act within their powers:
Director have the duty related to act in accordance with organisation constitution and
further only exercise their power for the purpose. (Trad and Kalpić, 2019) In addition with this, it
has been identified that directors of an organisation are required to exercise their power as per
according to organisation constitution that include agreements of a constitutional nature and
association and resolution. According to the case law of Regal (Hastings) Ltd v Gulliver [1942],
it has been identified that directors as well as officers are taking advantage in personal manner
from corporate opportunity that violates their duty. Thus, it has been evaluated that directors
must utilize their power in best effective interests of organisation as per according to entity's
constitution.
To exercise independent judgement:
It is essential for directors to exercise decision making process by considering
independent judgement (Bulat, 2019). It is important for directors to not subordinate their
powers to other. While they can ask for professional advices if there is need.
Not to accept benefit from third parties:
It is essential for directors to effectively promote business success and does not accept
benefits in form of bribe from any third party. Thus, it is one of the most essential duty which are
1
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required to be effectively undertaken by directors as to effectively operate their duties in well
defined manner.
Implementation of legal obligation
It is the one of the most important duty that has been undertaken by director. In this,
director duty as per according to Companies Act 2006. It has been signified that directors are
required to ensure that organisation must comply with relevant legislations such as Health and
Safety, Insurance obligations, Anti-corruption, The environment, Tax and Employment in best
effective manner.
Keep Accounting records
It is essential for directors to keep accurate accounting record as to further represent true
and fair position of company. In addition with this, directors also hold the duties towards paying
staff correctly while ensuring that proper deduction in terms of Income tax and National
Insurance contribution.
Duty to avoid conflicts of interest (section 175 Companies Act 2006)
It is most important and legal obligation of a company director as to avoid conflict of
interest that relates to transactions and situation of company that are involves within it. It has
been identified that directors hold personal responsibility in order to effectively avoid conflict in
order to ensure interests of company (What do the new directors' conflicts of interest provisions
mean for directors / companies?. 2008). Non-compliance is duly seen as breach of director
duties and can later fall into criminal action. The Statutory duty, from 1 October 2008, section
175 of the 2006 Act states that director is required to avoid situation of conflict in order to ensure
interest of company. In addition with this, it is essential for director to remove any kind of direct
and indirect conflicts as to ensure organisation interests.
2
defined manner.
Implementation of legal obligation
It is the one of the most important duty that has been undertaken by director. In this,
director duty as per according to Companies Act 2006. It has been signified that directors are
required to ensure that organisation must comply with relevant legislations such as Health and
Safety, Insurance obligations, Anti-corruption, The environment, Tax and Employment in best
effective manner.
Keep Accounting records
It is essential for directors to keep accurate accounting record as to further represent true
and fair position of company. In addition with this, directors also hold the duties towards paying
staff correctly while ensuring that proper deduction in terms of Income tax and National
Insurance contribution.
Duty to avoid conflicts of interest (section 175 Companies Act 2006)
It is most important and legal obligation of a company director as to avoid conflict of
interest that relates to transactions and situation of company that are involves within it. It has
been identified that directors hold personal responsibility in order to effectively avoid conflict in
order to ensure interests of company (What do the new directors' conflicts of interest provisions
mean for directors / companies?. 2008). Non-compliance is duly seen as breach of director
duties and can later fall into criminal action. The Statutory duty, from 1 October 2008, section
175 of the 2006 Act states that director is required to avoid situation of conflict in order to ensure
interest of company. In addition with this, it is essential for director to remove any kind of direct
and indirect conflicts as to ensure organisation interests.
2
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REFERENCES
Books and Journals
Trad, A. and Kalpić, D., 2019. The Business Transformation Framework and its Business
Engineering Law support for (e) transactions. In Advanced Methodologies and
Technologies in Business Operations and Management (pp. 230-246). IGI Global.
Ruesch, S., 2019. LibGuides: Business and Legal Aspects of Sports and Entertainment: Search
Tips.
Ruesch, S., 2019. LibGuides: Business and Legal Aspects of Sports and Entertainment: About
the Editors.
Glinkowska, B. and Chebotarov, V., 2019. Establishing a Business in Ukraine–the Initial
Regulatory Organizational and Legal Aspects for Polish Entrepreneurs.
Ibragimov, K.K., Nintsieva, T.M., Gaplaev, N.S., Ibragimova, F.K. and Ibragimov, A.K., 2019.
LEGAL ASPECTS OF EXTRAPOLATION NATURAL ECOSYSTEMS THEORY
TO THE DEVELOPMENT OF ENTREPRENEURSHIP. In The European Proceedings
of Social & Behavioural Sciences EpSBS (pp. 2675-2683).
Bulat, I., 2019. Legal aspects of protection of intellectual property objects in mining engineering.
In E3S Web of Conferences (Vol. 109, p. 00011). EDP Sciences.
Online
What are the Duties and Responsibilities of a Company Director?. 2018. [Online] Available
from<https://www.companydebt.com/what-are-the-duties-and-responsibilities-of-a-company-
director/>
What do the new directors' conflicts of interest provisions mean for directors / companies?.
2008. [Online]Available from<https://www.bclplaw.com/en-US/thought-leadership/what-
do-the-new-directors-conflicts-of-interest-provisions-mean-for-directors-companies.html
3
Books and Journals
Trad, A. and Kalpić, D., 2019. The Business Transformation Framework and its Business
Engineering Law support for (e) transactions. In Advanced Methodologies and
Technologies in Business Operations and Management (pp. 230-246). IGI Global.
Ruesch, S., 2019. LibGuides: Business and Legal Aspects of Sports and Entertainment: Search
Tips.
Ruesch, S., 2019. LibGuides: Business and Legal Aspects of Sports and Entertainment: About
the Editors.
Glinkowska, B. and Chebotarov, V., 2019. Establishing a Business in Ukraine–the Initial
Regulatory Organizational and Legal Aspects for Polish Entrepreneurs.
Ibragimov, K.K., Nintsieva, T.M., Gaplaev, N.S., Ibragimova, F.K. and Ibragimov, A.K., 2019.
LEGAL ASPECTS OF EXTRAPOLATION NATURAL ECOSYSTEMS THEORY
TO THE DEVELOPMENT OF ENTREPRENEURSHIP. In The European Proceedings
of Social & Behavioural Sciences EpSBS (pp. 2675-2683).
Bulat, I., 2019. Legal aspects of protection of intellectual property objects in mining engineering.
In E3S Web of Conferences (Vol. 109, p. 00011). EDP Sciences.
Online
What are the Duties and Responsibilities of a Company Director?. 2018. [Online] Available
from<https://www.companydebt.com/what-are-the-duties-and-responsibilities-of-a-company-
director/>
What do the new directors' conflicts of interest provisions mean for directors / companies?.
2008. [Online]Available from<https://www.bclplaw.com/en-US/thought-leadership/what-
do-the-new-directors-conflicts-of-interest-provisions-mean-for-directors-companies.html
3
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