Directors Flashcards
What are the seven codified duties of directors?
- To act within their powers
- To promote the success of the company
- To exercise independent judgement
- To exercise reasonable care, skill and diligence
- To avoid conflicts of interest
- Not to accept benefits from third parties
- To declare interests in any proposed transaction or arrangements
Do directors have unfettered authority to exercise the company’s powers?
No. Their authority is subject to any provisions in the Articles, their service contract and any authority limits adopted by the board
Can directors delegate any of their powers and duties?
Yes - Committees of the Board or appoint an alternate
How soon must notification of the vacation of office by a director be notified to Companies House?
14 days
How many directors should retire at the first AGM of a public company?
ALL
Why is succession planning important?
To ensure an orderly succession and to maintain the necessary balance of skills, experience, diversity, independence and balance
If a listed board has 2 executive directors, a chairman and a non-independent NED, how many independent NEDs must be appointed?
3 - at least half should be independent NEDs (excluding the chair)
Which companies are required to undertake board evaluations?
All listed companies
Which companies must carry out external facilitated board evaluations and how often?
FTSE 350 companies - at least once every three years
Who should evaluate the performance of the Chair?
The NEDs led by the senior independent director
When should a director receive induction training?
Shortly after appointment
Is it necessary for experienced directors to receive induction training?
Yes as all companies have different processes
Why do companies need directors?
The company is an independent legal personality and cannot operate by itself.
