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Gabby and Samantha are both non-executive directors of Bingo Bank Limited (Bingo Bank).

Samantha is also a partner of Financial Consultants, a firm which has dealings with Bingo Bank from time to time. Samantha has proposed to her fellow directors that Financial Consultants should have a permanent consulting role with Bingo Bank and has strongly urged her fellow directors to approve the proposal.

While the other directors know that Samantha is a partner of Financial Consultants, they are not told that Samantha will be paid an additional commission if the proposal is approved. Gabby, who rarely involves herself in board matters, does not trust Samantha but believes the other directors will not be interested in her views and that in any event the other directors would not approve the proposal, so her vote will not make any difference. Therefore, Gabby does not turn up at the board meeting at which the proposal is considered. The proposal is in fact approved by the other directors. Advise both Gabby and Samantha of any potential breaches of their fiduciary or statutory duties as directors of Bingo Bank.


 

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Subject: Accounting, Business

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