Director’s Duties in the UK: Cases and Legislation
Director’s duties form the backbone of the UK’s corporate governance framework. They structure how power is exercised within companies, guide managerial decision-making, and ensure accountability to shareholders and, in certain circumstances, to broader stakeholder groups. Over the past two decades, the UK has experienced significant shifts in this area, particularly following the partial codification of directors’ duties in the Companies Act 2006 and the emergence of modern governance expectations driven by ESG considerations, technological change, and international market pressures. This blog post explores the statutory duties, the case law shaping their interpretation, and the evolving standards that continue to redefine directors’ responsibilities. The Statutory Framework: Companies Act 2006 The Companies Act 2006 introduced a watershed moment by codifying, albeit only partially, the core duties of directors. These duties, set out in sections 171 to 177, require directors to a...
