The first statutory code on directors' duties came into force on 1st October 2007 by virtue of the Companies Act 2006.

The Act, the most radical overhaul company law has seen for many years codifies company directors' duties, pulling together case law, common law duties and statutory obligations.

The seven new general directors' duties laid down are as follows:-

• A duty to act in accordance with the company's constitution;
• A duty to promote the success of the company for the benefit of its members;
• A duty to exercise independent judgement;
• A duty to exercise reasonable care, skill and diligence;
• A duty to avoid conflicts of interest;
• A duty not to accept benefits from third parties; and
• A duty to declare to the company's other directors any interest a director has in a proposed transaction or arrangement with the company.

One of the significant differences between the current regime and the new provisions is the requirement of a director to promote the success of the company for the benefit of its members as a whole. In doing so directors must have regard, amongst other things to the likely consequences of their decisions, the interests of the company's employees and the impact of operations on the community and the environment.

For further information and advice on how these changes impact upon you and your business call Craig Davies on 01827 317083