In South Africa, company directors have specific legal duties and fiduciary responsibilities under the Companies Act 71 of 2008, common law, and other applicable regulations. Here is a clear breakdown of a director’s duties:

⚖️ 1. Fiduciary Duties (Act in Good Faith)

Directors must:

• Act in good faith and in the best interests of the company.
• Avoid conflicts of interest (must disclose any personal financial interest in company contracts).
• Not use their position or company information for personal gain.
• Always act with honesty and integrity.

🧠 2. Duty of Care, Skill, and Diligence

Directors must:

• Exercise the care, skill and diligence that may reasonably be expected from someone in that role.
• Keep informed about the company’s affairs.
• Make decisions based on reasonable grounds.
• Attend meetings and participate actively.

📑 3. Statutory Duties (under the Companies Act)

Some key responsibilities include:

• Ensure the company complies with the Companies Act, Tax Acts, labour laws, environmental laws, etc.
• Maintain proper financial records and submit annual returns.
• Ensure the preparation and approval of annual financial statements.
• Appoint a company secretary or auditor (if required).
• Call shareholder and board meetings as required.
• Act within the company’s Memorandum of Incorporation (MOI).
• Avoid carrying on business recklessly or trading under insolvent conditions.

📉 4. Duties in Case of Financial Distress

• If a company is financially distressed, directors must:
  • Assess whether to begin business rescue proceedings or
  • Deliver a written notice to shareholders explaining why business rescue is not being pursued.

🛑 5. Prohibited Conduct

Directors must not:

• Allow the company to trade recklessly, with gross negligence, or with intent to defraud.
• Make false statements or submit false financial information.
• Approve distributions (dividends) that would make the company insolvent.

🔄 6. Accountability and Liability

Directors can be held personally liable if they:

• Breach fiduciary or statutory duties.
• Sign off on reckless trading or improper distributions.
• Knowingly allow the company to incur debt without a reasonable prospect of repaying it.

✅ Good Governance Practices

• Keep minutes of board meetings.
• Keep personal and company matters separate.
• Ensure compliance with POPIA, BBBEE (if applicable), SARS, and CIPC obligations.

If you are a director or appointing one, it’s essential to understand that these duties are not just formalities — they carry serious legal consequences if breached.

Let me know if you’d like a sample director’s appointment letter or a checklist of director duties.