Duty of Care. Are you forgetting someone?
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Future Directors Founder, Paul Smith
ONE THING is for the busy (speak of the devil) Future Director, in which we pick just one thing Future Directors oughta know or do or stew on for the next month. We hope you get something (at least one thing) out of it.
One Thing: Duty of Care. Are you forgetting someone?
When governance types and board directors talk about duty of care, they tend to mean the usual suspects; shareholders, employees, customers, regulators, communities, and sometimes even the environment. Duty of care is a fundamental legal and ethical obligation, requiring directors to act in good faith, make informed decisions, and prioritise the interests of the organisation (ie its stakeholders, or as I like to call them impacted parties). This principle is baked into governance rules and structures worldwide, supposedly to ensure that board members remain diligent, responsible, and accountable for their decisions.
Traditionally, duty of care means staying informed about the company’s financial position, risks, and strategic direction. It means showing up prepared for board meetings, asking insightful, and ensuring that the board’s decisions are made with “sound judgment and due diligence”. Directors are expected to oversee compliance with laws and the long-term sustainability of the business.
They are fiduciaries, stewards of the company, and guardians of stakeholder interests etc etc.
So, it’s all for the aforementioned stakeholders.
Obviously, not all board decisions will impact different stakeholders equally, and in the same direction. For example, firing a bunch of staff might be good for profits, but it’s not good for employees or morale. However, I’m not going to dive into how you might prioritise these stakeholders.
Instead, I want you to consider how the widely accepted definition of company stakeholders, for whom you have a duty of care, often overlooks two crucial groups. I will put it to you that WITHOUT CONSIDERING THEM, we’re not truly fulfilling our duty of care.
Who are we missing?
First, your fellow directors. It seems obvious, but yes, they are stakeholders in the organisation and they matter. They do not sit apart or outside, even if they are independent or unpaid. The people around the boardroom table rely on each other. Their views, insights, time, engagement, and willingness to challenge or support shape the quality of boardroom discussions and, ultimately, decision-making. You have a duty to show up, be respectful, create a safe space, listen, and might I say, care for each other.
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