CABO VERDE Trends and Developments Contributed by: Nelson Raposo Bernardo, Joana Andrade Correia, Júlio Martins Júnior and Manuel Esteves Albuquerque, Raposo Bernardo & Associados
The Duty of Loyalty of Administrators in the CSCV: Ethical, Legal, and Fiduciary Dimensions The duty of loyalty stands as one of the funda - mental pillars of corporate governance, mandat - ing that administrators act in good faith and in the best interests of the company at all times. Article 79 of the CSCV explicitly stipulates that the members of the administrative organs must conduct themselves “with the diligence of a prudent and orderly manager and with loyalty, in the interest of the company” . This duty imposes a mode of conduct oriented towards the cor - porate interest, rendering inadmissible the per - sonal exploitation of business opportunities or the advocacy of interests that are antagonistic to those of the company. The interpretation and application of this duty within Cape Verde are informed by prevailing international best prac - tices. Any conduct deviating from this standard may even provide grounds for a civil liability action. In its ethical dimension, the duty of loyalty neces - sitates that administrators act with probity and good faith, prioritising the interests of the com - pany above their own personal interests. From a legal standpoint, this duty entails the obligation to safeguard the company’s assets and to pro - mote its commercial objectives. From a fiduci - ary perspective, the duty of loyalty reflects the trust reposed in the administrators by the com - pany and its diverse array of stakeholders. The pertinence of the duty of loyalty extends to the protection of the interests not solely of the share - holders but also of other entities crucial to the company’s sustainability, such as employees, clients, and creditors. A transparent, efficient, and responsible administration, firmly anchored in the duty of loyalty, is indispensable for foster - ing confidence within the markets, among inves - tors, and among the shareholders themselves.
The Regime of Conflicts of Interest in the Cape Verde Commercial Companies Code The CSCV dedicates particular attention to the subject of conflicts of interest, establishing a comprehensive legal regime that is aligned with international principles of corporate governance. Article 79, in addition to establishing the duty of loyalty, imposes upon administrators the obliga - tion to communicate to the company any situ - ations that may potentially constitute a conflict of interest. Moreover, the CSCV outlines several specific prohibitions and restrictions designed to forestall the occurrence of conflict situations. For instance, the granting of loans or any form of credit to administrators, as well as the provision of guarantees for their obligations or the provi - sion of salary advances exceeding one month’s remuneration, is expressly prohibited. Conversely, Article 80 declares null and void any clause that purports to exclude or limit the liabil - ity of administrators for breaches of their duties, as well as any clause that makes the initiation of a liability action contingent upon prior authorisa - tion. This provision underscores the significance of holding administrators accountable and pre - vents them from shielding themselves against legal proceedings arising from the non-fulfilment of their responsibilities. It is also pertinent to note that Article 83 recognises the legitimacy of shareholders holding at least 5% of the share capital to initiate a social liability action, even in instances where the company itself has not pur - sued such action. This mechanism is intended to counteract situations of institutional inertia or the capture of supervisory bodies, thereby ensuring the protection of the interests of minority share - holders. While the CSCV does not furnish an exhaustive enumeration of situations that may give rise to conflicts of interest, certain common examples
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