Ghana
Answer ... Under the Companies Act 2019, the board:
- has ultimate responsibility for the company’s performance;
- must act in the best interests of the company; and
- is fully accountable to the shareholders and other stakeholders.
The board’s duties include statutory duties and other duties of performance. The duties of board members may be summarised as follows:
- Act honestly and in good faith in the interests of the company;
- Avoid actual or potential conflicts of interest and duty;
- Disclose fully and fairly any interest in a transaction involving the company;
- Comply with all obligations attributable to the board under the Companies Act 2019, such as:
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- showing utmost honesty and loyalty in transactions involving the company due to the fiduciary relationship between the company and directors;
- preserving assets, advancing business and upholding the board’s mission to benefit the company’s overall wellbeing;
- considering the long-term consequences of choices, the company’s impact on community and environment and how best to maintain a strong business reputation;
- considering employees’ and members’ interests when making decisions, especially when representing a specific group.
- staying independent in decision making;
- avoiding conflicts of interest and duties with others; and
- disclosing conflicting interests to the board for same to be listed in the interests register of the company;
- Comply with all other applicable laws and policy guidelines issued by the Ministry for Lands and Natural Resources;
- Monitor management and provide strategic guidance subject to any policy guidelines set by the company;
- Establish relevant internal policies and ensure compliance with all relevant laws and regulations;
- Set the company’s long-term strategy and performance objectives, and monitor corporate performance;
- Monitor and manage potential conflicts of interest;
- Ensure the implementation of appropriate risk management/regulatory compliance policies;
- Ensure the integrity of the company’s accounting and financial systems (including independent audit) and the operation of control systems such as risk management, financial and operational controls;
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Set:
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- the terms of the managing director’s and senior executive compensation; and
- the terms and conditions of employment of company employees;
- Define compensation for board members and provide guidelines for other related expenses; and
- Ensure that the company adheres to high standards of ethics and relevant industry behaviour.
Ghana
Answer ...
- By appointing a managing director from the board in accordance with Section 183 and 184 of the Companies Act 2019 and delegating authority to the managing director to act and report to the board periodically;
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By setting up committees of the board:
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- to oversee relevant management projects and report to the board on same; and
- to review relevant documents submitted by management for recommendation to the board for decision making; and
- By setting targets for and reviewing the performance of management to make relevant recommendations to the board for decision making by the board.
Ghana
Answer ... (a) Strategic planning?
The board must:
- ensure the development and implementation of strategic and other plans of the company on an annual, semi-annual or quarterly basis; and
- monitor and evaluate the implementation of the plans to promote the success of the company.
(b) Risk management?
The board must ensure that the risks facing the company are identified, measured and managed. To this end, it should establish a risk management framework which outlines processes for:
- identifying risks and/or determining the appropriate risk appetite;
- assessing and evaluating the likelihood of recurrence, tolerance levels and potential impact; and
- taking the necessary mitigation actions.
The board must also ensure that the right personnel have the capacity and commitment to implement the company’s risk management strategies.
(c) Major and related-party transactions?
The board must ensure that major and related-party transactions (including internal group transactions):
- are reviewed in order to assess risk;
- are subject to appropriate restrictions (eg, by requiring that such transactions be conducted on non-preferential terms); and
- comply with applicable legislation and other requirements, such as those prescribed under Sections 67 to 70 of the Banks and Specialised Deposit Taking Institution Act 2016 (Act 930) regarding exposure limits for loans to related parties and staff.
(d) Conflicts of interest?
The board must create and maintain a register of conflicts of interest in accordance with Sections 192 and 194-196 of the Companies Act 2019.
The board is encouraged to create an organisational culture that encourages employees to participate in the review of existing conflict of interest policies and practices, in order to improve their skills in identifying and resolving present and future conflicts of interest.
The board should ensure that:
- a member of the governing body is recused from involvement in any affected decision-making process;
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all members of the governing body, employees, service providers, clients and other stakeholders are duly trained in and reminded of:
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- the organisation’s policy on gifts, conflict of interest, transparency and accountability mechanisms;
- its application in the organisation; and
- their personal responsibilities in the execution of the rules; and
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an ethics committee is established or officers appointed, among other things, to:
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- promote observance and compliance with all organisation policies and guidelines; and
- ensure that breaches are dealt with in accordance with the specified rules and regulations, to foster public confidence in the integrity of the governing body and its decision making.
Ghana
Answer ... Individual non-executive board members provide their expertise solely in the boardroom and at committee meetings.
The role of individual executive board members is not restricted, because they represent the views of management in the boardroom and represent the board to management in dispensing their duty as executive management members of the company.
Ghana
Answer ... In Ghana, individual board members have the legal duties and responsibilities outlined in the Companies Act 2019. These duties are owed primarily to the company and its stakeholders, including:
- shareholders;
- employees;
- customers;
- suppliers; and
- the wider community.
The key legal duties of individual board members in Ghana include the following:
- Duty of care: Board members have a duty to act with reasonable care, skill and diligence in the performance of their roles. This includes making informed decisions and exercising due diligence in their responsibilities.
- Duty of loyalty: Board members have a duty to act in good faith and in the best interests of the company. They must avoid conflicts of interest and disclose any potential conflicts that may arise between their personal interests and the interests of the company.
- Duty of obedience: Board members have a duty to act in accordance with the company’s constitution, applicable laws, regulations and other legal obligations. They must ensure that the company operates within the legal framework and complies with its statutory obligations.
- Duty of confidentiality: Board members have a duty to maintain the confidentiality of sensitive information acquired in their capacity as board members. This duty ensures that sensitive company information is protected and not disclosed to unauthorised persons.
- Duty to promote success: Board members have a duty to promote the success and long-term viability of the company. They should act in a manner that contributes to the company’s sustainable growth, profitability and overall wellbeing.
Ghana
Answer ... Individual board members in Ghana can potentially face civil and criminal liabilities for their actions or omissions in the performance of their duties. The specific liabilities vary depending on the nature of the violation and relevant laws. Potential liabilities that individual board members in Ghana may encounter include the following:
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Civil liabilities:
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- Breach of fiduciary duty: Board members owe fiduciary duties to the company and stakeholders. Breach of these duties by acting against the company’s best interests or engaging in self-dealing can result in liability for damages caused.
- Negligence or mismanagement: If a board member’s actions or omissions lead to losses or harm to the company or stakeholders due to negligence or mismanagement, they may be held liable.
- Breach of confidentiality: The disclosure of sensitive or confidential information without authorisation or violation of the duty of confidentiality can result in liability for damages caused.
- Breach of contract: Failure to fulfil contractual obligations, including duties outlined in appointment or employment agreements, can lead to liability for breach of contract.
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Criminal liabilities:
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- Fraud: Engaging in fraudulent activities such as embezzlement, falsification of financial statements or deliberate misrepresentation can result in criminal charges relating to fraud, leading to fines and imprisonment.
- Corruption and bribery: Participating in corrupt practices such as bribery or kickbacks is a criminal offence. Board members involved in corrupt activities may face criminal charges, including fines and imprisonment.