This article, the ninth in our series on the Companies Act 2006, will focus on the statutory duties of directors, considering the implications around avoiding conflicts of interest, exercising independent judgments and promoting the company
CA 2006 is the first Companies Act to codify directorsʼ duties in statute, these having hitherto been governed by case law. The government accepted the recommendations of the Company Law Review that the codification should reflect the current state of the law without making fundamental changes to the fiduciary nature of directorsʼ duties.
The Company Law Review, which was set up in 1998 and led (eventually) to CA 2006, recommended that there should be a statutory statement of directorsʼ general duties, and that this should be a codification of the current law. In particular, they wanted:
to provide greater clarity on what is expected of directors and make the law more accessible. In particular, they sought to address the key question ‘in whose interests should companies be run?’ in a way which reflects modern business needs and wider expectations of responsible business behaviour; and
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