GHANA Law and Practice Contributed by: Victoria Bright and Justice Oteng, Addison Bright Sloane
• within the preceding five years, they have not been charged with or convicted of an offence involving dishonesty or fraud; • they have not been a director or senior manager of a company that has become insolvent; and • they have not been charged with or convicted of a criminal offence relating to the incorporation and promotion of a company. A company can remove any or all directors from the board if they have been disqualified from acting in that capacity. Directors are removed by ordinary resolution at a general meeting by the shareholders. The Companies Act requires that a resolution to remove the director shall not be moved at a general meeting unless notice of this resolution has been giv - en to the company a minimum of 35 days before the meeting at which the resolution is to be moved. The board may remove the company secretary, without prejudice to the secretary’s right to damages where a breach of contract is occasioned in so doing. 3.5 Independence of Directors Article 284 of the 1992 Constitution provides that pub - lic officers shall not put themselves in a position where their personal interest conflicts or is likely to conflict with the performance of the functions of their public office. Board directors are required to disclose to the com - pany any potential conflict of interest between them - selves and the company. Such information, disclosed in writing or at a meeting of the board, will be recorded in the Interests Register. Failure to make this disclo - sure attracts a fine. Act 992 further requires directors to exercise independent judgement and, in addition, they are precluded from using their positions or com - pany money/property except for the prescribed usage listed in Act 992 or the company’s constitution. Further, directors may not utilise for personal gain any confidential information obtained in their capacity as director, and must not be directly beneficially inter - ested in a business which competes with that of the company, nor have personal or indirect interests in any contract or transaction other than those provided for in the Act 992.
Accordingly, unless a company consents, directors shall not place themselves in a position in which their duty to the company potentially conflicts with their personal interest or duties to other persons. The law makes exceptions: the duty of a director to avoid con - flict is not infringed if they have the board’s consent, have fully disclosed their interests early on, and have not voted in any board meetings pertaining to the decision in which the director does have an interest. Provided they have the company’s consent, a direc - tor may enter into a potential conflict of interest relationship concerning the company, notwithstand - ing potential legal fallouts: for example, a derivative action. Regardless of its public or private status, con - sent by the company is mandatory in this context. In private companies, this can be done when there are no provisions in the company’s constitution prohibit - ing authorisation. For public companies, authorisation can be given if the company’s constitution permits the board to authorise the action. 3.6 Legal Duties of Directors/Officers Directors Directors owe their fiduciary duties solely to the com - pany itself as they hold a position of trust. Directors are expected to act in good faith and in the best inter - est of the company at all times. This involves pre - serving the company’s assets as well as furthering the company’s business interests. For instance, they are prohibited from taking the company’s assets for personal benefit. The standard expected of directors encompasses the necessity to consider the consequences of any actions they take, and maintain high standards and a good brand reputation. According to the Second and Third Schedules to the Companies Act, 2019, the directors shall manage the business of the company. During the pre-incorporation stage, they are author - ised to make payments from the company’s coffers for all expenses incidental to promoting and registering the company. Directors exercise the powers of the company, includ - ing borrowing money, charging property and the issu - ance of debentures. Directors are entitled to enter into a contract with the company, notwithstanding the
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