1. Introduction

The Companies Act, 2012, together with the Code of Corporate Governance, establishes a comprehensive framework for the management and regulation of companies in Uganda. Central to this framework are two critical offices—the directors and the company secretary—who together ensure that companies remain compliant with the law, uphold sound governance standards, and operate in the best interests of their shareholders and other stakeholders.

This article examines the statutory responsibilities of directors and the company secretary, highlighting their respective roles in corporate compliance and management as enshrined in the Companies Act, Cap.106

2. Who is a Director?

The Act adopts a functional definition of the term director.

• Section 2 defines a director as “any person occupying the position of director by whatever name called,” and includes a shadow director.
• Section 132(5) expands this to include any person “in accordance with whose directions or instructions the directors of the company are accustomed to act.”
• The Articles of Association, specifically Articles 107–109 of Table A, further empower the board of directors to delegate functions to a managing director.

3. Corporate Governance Framework

The role of directors is guided not only by the Act but also by the Code of Corporate Governance.

• Section 14(1) of the Act makes it mandatory for public companies to adopt the code contained in Table F.
• Section 14(2) permits private companies to voluntarily adopt the same code.
• Importantly, Section 14(4) requires that any company adopting Table F must file an annual statement of compliance with both the Registrar of Companies and the Capital Markets Authority.

This demonstrates that compliance and governance are continuous obligations, not one-off formalities.

4. Duties of Directors in Enforcing Corporate Compliance and Management

(a) General Duties under Section 198

Directors are entrusted with wide-ranging duties aimed at ensuring compliance and promoting sound corporate management. These include:

1. Ensuring compliance with the Companies Act and other applicable laws.
2. Acting in a manner that promotes the success of the company’s business.
3. Exercising reasonable skill and care, comparable to that of a prudent person managing their own affairs.
4. Acting in good faith in the interests of the company as a whole, which entails:
   • Treating all shareholders equally.
   • Avoiding and declaring conflicts of interest.
   • Refraining from making personal profits at the expense of the company.
   • Rejecting benefits from third parties that may compromise impartiality.

(b) Duty under Section 190

Directors must also ensure that the company appoints a qualified company secretary with the requisite skills and professional experience. This emphasizes the directors’ role in safeguarding the integrity of corporate governance.

(c) Duties under Table F (Article 1(4))

Directors are further tasked with:

• Providing strategic direction.
• Retaining full and effective control of the company.
• Complying with laws and regulations.
• Delegating powers responsibly to management.

These obligations collectively establish directors as the custodians of corporate compliance and management.

5. The Company Secretary(a) Statutory Basis

The office of the company secretary is a statutory requirement.

• Section 187 mandates that every company must have a secretary.
• Section 190 specifies the qualifications, which may include being:
  • An advocate of the High Court of Uganda,
  • A member (or eligible member) of the Institute of Certified Public Accountants of Uganda, or
  • A member (or eligible member) of the Institute of Chartered Secretaries and Administrators.

The mandatory appointment and qualification requirements emphasize the centrality of the secretary in corporate compliance.

6. Duties of the Company Secretary in Corporate Governance and Compliance

The company secretary acts as the compliance officer and a critical advisor to the board.

(a) Duties under Article 10(2) of Table F

• Provide directors with guidance on their responsibilities.
• Induct or participate in the induction of directors.
• Assist the chairperson and CEO in setting the annual board plan.
• Administer other strategic board-level matters.
• Act as a central source of guidance on ethics and governance.

(b) Duties under Article 4(8) of Table F

• Brief directors on new laws and regulatory developments.

(c) Duties under Article 9 of Table F

• Implement restrictions on directors and officers from trading in securities during sensitive periods, such as between the end of an accounting period and the release of financial results.

Through these functions, the company secretary ensures that governance systems are not only established but are also continuously updated and observed.

7. Conclusion

The Companies Act, Cap 106 positions directors and the company secretary as complementary pillars of corporate compliance and management. Directors bear the ultimate responsibility for strategy, oversight, and lawful conduct of company affairs, while the company secretary provides technical expertise, regulatory monitoring, and administrative support to enforce governance standards.

Together, these offices ensure that companies in Uganda operate transparently, ethically, and in accordance with the law—thereby safeguarding shareholder interests and promoting the broader goal of good corporate governance.