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Article Summary

This practice note provides an overview of the powers of directors of companies incorporated under the Companies Act 2006 (CA 2006). It explains that directors are responsible for managing the company and making decisions on its behalf. Their main powers derive from the company's articles of association, CA 2006, common law principles and shareholder resolutions. The articles give directors a general power of company management, while the statute confers specific powers like calling general meetings. Common law principles like the separation of ownership and control establish directors' autonomy. Shareholders can also pass resolutions conferring powers on directors for particular actions. However, directors' powers are subject to limitations. The articles themselves can restrict directors' powers, as can their statutory duties, especially the duty to act within their powers and for proper corporate purposes. Certain matters like amending the articles are reserved to shareholders. Directors can delegate their powers to committees, officers or other individuals. Individual directors have no inherent powers but may have express, implied or ostensible authority. Most powers are conferred on the board collectively. For older companies, previous statutory articles like Table A also covered directors' powers.