MCW_Lawyers MCW_Lawyers
MCW_Lawyers
Home our team services changing law seminars contacts
MCW_Lawyers
 
law updates
 
 

accredited certifiers & quality of plans

auctions
avoiding negligence
bankruptcy
business
company structures
contracts
codes sepp
debt
disposal of assets
employees as carers

guide to franchise disputes

insurance

internet content
negligence
neighbours
psychiatric injury
shareholder rights
proposed draft local environmental plan
stolen goods
sub-divisions
tax audits
the new trees legislation
tree dispute principles
trusts
workplace relations
 
law updates > shareholder rights
Shareholder Rights
Calling Directors to Account

In light of recent company failures, regulators have introduced proposals to make directors and senior executives more accountable to companies and their shareholders.

The Australian Stock Exchange has issued recommendations for listed companies to make directors and senior executives more accountable to companies and shareholders. Under these proposals, nomination committees would be established, with responsibilities which include assessing the competency of current directors, and shareholders would be entitled to a range of information on proposed directors, such as biographical details, including the competency and qualifications of directors submitted for election.

These proposals aside, directors already have a legal duty of care. The "business judgment rule" protects directors from liability if they make an honest mistake in the conduct of their duties, so long as they can show that their decision was made in good faith and in the best interests of the corporation and that they obtained all appropriate information beforehand. It seems to be clear that this rule will not prevent directors from incurring liability if they fail to exercise due care in making significant decisions.

Reproduced from In Touch With The Law, published by the Law Society of NSW

 
services for individuals services for business
  Sutherland 02 9589 6666
  © MCW Lawyers 2008 | This is designed and maintained by Divine Creative Design.
n