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5. Directors’ Duties
• Duty to promote the success of the company; shareholder primacy and stakeholthng • Duty to exercise independent judgment • Duty to …Ise reasonable rare, skip, and diligence • Duty to .thd conflicts of thterest • Duty not to accept benefits from third path. • Duty to declare Interest in proposed transaction or arrangement; substantial property transactions, loans, and quasi-loans • Consequences of breach of duty • Ratification and relief from liability • Connect rens (In particular) with: management and g.emance, company contracts, shareholder remedies, capital, corporate Insolvency. Most courses will expect you to be able to link duties with enforcement of duties by shareholders: .e further Chapters 7 and 12
Key Debates
Debate: to whom should directors owe their duties?
This debate is particularly exp.., stretching from questions such as whether individual shareholders should be owed duties by directors, to creditor interests and directors’ obligations on Insolvency, to notions of stakeholding and shareholder primacy. The proposals of the Company Law Review and the introduction of CA 2006, s.172, were catalysts fora great deal of discussion on the. points. The literature is extensive, with much of inter., but the wore of Andrew Keay, both on creditor interests and the ‘corporate objective, is both readable and stimulating.
Debate: how strict should the law be in regulating conflicts of interest? Differing attitudes to liability for conflict of interest can be seen in both cases and academic commentary. While some argue that. strict prophylactic role (as exemplified by older authorities) is aPProPrlare,thers argue strongly fora more nuanced and Oexlble approach. There is still discussion as to what level of flexibility CA 2006, s. r75 incorporates, and whether the ability to authorize breaches goes t. far.
Su05crINH: Queen Mary Vnivlralty Of Lon<on; date: 13 RDNI 2023
5. Dinxtees. Duties
Question 1