Rakesh is the Managing Director of ABC Co. Ltd., a listed company having its registered office in Bangalore. In December, 2018 an allegation of the Managing Director's immediate family members and Alfa Co. Ltd. which got

The directors of a company are required to act in the best interest of the company since they occupy a position of trust and owe a fiduciary duty to the shareholders of the company. Under section 166 of the Companies Act, 2013 the duties of the directors include: duty to exercise his duties with due and reasonable care, skill and diligence and to exercise independent judgment. not to involve in a situation in which he may have a direct or indirect interest that conflicts, or possibly may conflict, with the interest of the company. not to achieve or attempt to achieve any undue gain or advantage either to himself or to his relatives, partners, or associates and if such director is found guilty of making any undue gain, he shall be liable to pay an amount equal to that gain to the company. In the instant case Rakesh has failed to disclose the business interest of his immediate family member have with Alfa Co. Ltd. which has business relations with ABC Co. Ltd. And had been given contract worth ₹1000 crores. Thus Rakesh has violated the provisions of section 166 of the Companies Act, 2013 in discharge of his duties. Further Rakesh should have made disclosure of his interest as per section 184 of the Companies Act, 2013. Regulation 4(2)(f) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 contains the responsibilities of the board of directors of a listed entity. As regards, disclosure of information, it states the following: Disclosure of information: Members of board of directors and key managerial personnel shall disclose to the board of directors whether they, directly, indirectly, or on behalf of third parties, have a material interest in any transaction or matter directly affecting the listed entity. The board of directors and senior management shall conduct themselves so as to meet the expectations of operational transparency to stakeholders while at the same time maintaining confidentiality of information in order to foster a culture of good decision-making. Thus in view of the above Rakesh has breached the provisions of Regulation 4 of the SEBI (LODR) Regulations, 2015.