Extract

Duties of company directors in Portuguese Law developed from a simple formulae to ever increasingly detailed statutes. For a long time, since at least 1888 (Commercial Code), duties of directors were legally based on the contract of mandate. The relationship between the director and the company was seen as contractual, and directors were bound by very broad and general duties of diligence and loyalty. Later, in 1969, the law (Decree-Law 49,381, of 15.11.1969), expressly obliged the directors to act “with the diligence of a judicious and orderly manager” (diligência de um gestor criterioso e ordenado). An even more detailed formula was added more recently: “the directors of a company must act with the diligence of a skilful and careful manager, in the interest of society, taking into account interests of shareholders and employees”. Finally, art. 64º(1) of the Companies Code was revised in 2006.