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Australia · Year 4 · Corporations Law

Directors' Duties

Corporations Act 2001 (Cth).

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  1. 1.Corporations Act 2001, s 180?

    Directors and officers must exercise their powers and discharge their duties with the care and diligence a reasonable person would exercise in their position (with the business judgment rule in s 180(2)).

    Corporations Act 2001 (Cth), s 180

  2. 2.Corporations Act 2001, s 181?

    Directors must act in good faith in the best interests of the corporation and for a proper purpose.

    Corporations Act 2001 (Cth), s 181

  3. 3.Corporations Act 2001, ss 182 and 183?

    Directors must not improperly use their position (s 182) or information obtained because of their position (s 183) to gain an advantage or cause detriment to the corporation.

    Corporations Act 2001 (Cth), ss 182–183

  4. 4.Corporations Act 2001, s 588G?

    A director must prevent the company incurring a debt while it is insolvent or would become insolvent by incurring the debt, where there are reasonable grounds to suspect insolvency.

    Corporations Act 2001 (Cth), s 588G

  5. 5.ASIC v Healey (Centro case) (2011) — held?

    Directors must read, understand and focus on financial statements they approve; they cannot simply delegate that responsibility to management and advisers.

    [2011] FCA 717