Skip to main content
CLOSE

Charities

Close

Corporate and Commercial

Close

Employment and Immigration

Close

Fraud and Investigations

Close

Individuals

Close

Litigation

Close

Planning, Infrastructure and Regeneration

Close

Public Law

Close

Real Estate

Close

Restructuring and Insolvency

Close

Energy

Close

Entrepreneurs

Close

Private Wealth

Close

Real Estate

Close

Tech and Innovation

Close

Transport and Infrastructure

Close
Home / News and Insights / News / Non-executive directors: duties and responsibilities

The recent case of Secretary of State for Business, Energy and Industrial Strategy v Selby and others [2021] has illustrated that the standard of conduct applied to a director also applies and is upheld in regards to a non-executive director (NED) even where an NED does not play an active role in the day-to-day decisions and management of a company. In this particular case, the NED’s failure to adequately research and investigate basic information on the 28 deals that led to a significant increase in turnover and continued delegating of matters to the other directors were considered to be an abrogation of the NED’s duty to the company.

Whilst the CA 2006 does not make an explicit distinction between the duties of an executive director and NED’s, the court emphasised that both roles assume the same responsibilities. Furthermore, if the NED involved has particular experience and qualifications, the standard of responsibility is increased. In this case, the NED breached his duties as he should have made thorough investigations and co-operated diligently with HMRC.

This case has provided a timely reminder to directors of their duties generally and confirmation that executive directors and NED are largely judged by the same standards.

Related Articles

Our Offices

London
One Bartholomew Close
London
EC1A 7BL

Cambridge
50/60 Station Road
Cambridge
CB1 2JH

Reading
The Anchorage, 34 Bridge Street
Reading RG1 2LU

Southampton
Grosvenor House, Grosvenor Square
Southampton SO15 2BE

 

Reading
The Anchorage, 34 Bridge Street
Reading RG1 2LU

Southampton
Grosvenor House, Grosvenor Square
Southampton SO15 2BE

  • Lexcel
  • CYBER ESSENTIALS PLUS

© BDB Pitmans 2024. One Bartholomew Close, London EC1A 7BL - T +44 (0)345 222 9222

Our Services

Charities chevron
Corporate and Commercial chevron
Employment and Immigration chevron
Fraud and Investigations chevron
Individuals chevron
Litigation chevron
Planning, Infrastructure and Regeneration chevron
Public Law chevron
Real Estate chevron
Restructuring and Insolvency chevron

Sectors and Groups

Private Wealth chevron
Real Estate chevron
Transport and Infrastructure chevron