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Duties of Directors in a Company (Explained Clearly)

The director position of a Private Limited Company or Limited Company or One Person Company is vested with power and particular roles and responsibilities. According to Section 262 of the Act, the shareholders appoint the company director after a General Meeting or circular resolution. 

Duties of directors 

To Act with powers

The company director is a significant role that requires a person to act with power complying with the company’s policies and delegated tasks. The duties related to and based on the Articles of Association and broader constitutional issues, such as shareholder/joint venture agreements, must be adhered to. 

To attend meetings

Meetings are essential criteria that a director should consider. According to Indian Law, It may reject directors from the Directorship if they fail to attend three consecutive board meetings or all meetings held in three months. They should do their best to follow all the meetings as possible and obtain leave of absence from the Board in case of any emergency or other excuses. 

To promote the success of the company.

A company’s growth crucially depends on the efforts of the director. Therefore they need to act with fidelity and honesty, enhancing the company’s and the employee’s development. 

Carry out independent judgment

The company’s director must follow the company’s rules and regulations. The company’s constitution/ agreement must be obeyed at all costs, and the director must use independent judgments in all circumstances. The director must take responsibility for all his actions while making independent decisions. 

NOT to exceed powers

The MOA (Memorandum of Association) is a legal document that establishes the company’s authority. The AOA (Articles of Association) consists of details regarding the purpose and regulations of the company’s operations and the duties related to the directors. The director must only exercise power by adhering to the limits mentioned in the AOA. Their actions should not exceed the boundaries of the company. 

Consistently exercise reasonable care, skill, and diligence.

The director of the company must be a person of skill and excellence. They play a vital role in the operations of a company. They must exercise reasonable care, skill, and diligence in carrying out all position functions. The company directors are expected to fulfil a director’s responsibilities instead of just being appointed based on merit or reputation. 

To avoid conflicts of interest.

The conflict of interest may jeopardize the company’s objectives. Therefore, the director must act loyal. They must manage and avoid any such situations that would pose a threat to the company’s operations. 

NOT to make secret profits

The company’s director must keep the company’s secrets and affairs confidential. They must never use it for their benefit. They should never forgo their loyalty or involve in irresponsible activities.


The directors of the company must attend all the board meetings. They should stay updated regarding the operations of the company. They must be aware of all the activities related to the company’s progress. They must record the minutes of all the meetings correctly. They should act soberly and be updated with all the information to avoid legal issues in the future. 

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