What are my duties as a new Company Director?

So, you have decided to incorporate your business, or you are already a Director of Company. Do you know your basic responsibilities as an Officer? It doesn’t matter if you are a sole Director or member of a Board, you still have responsibilities that you are required to adhere to, by law.

Being a Company Director has a lot more requirements than just running the business, with some very heavy penalties for non-compliance.

Here is a brief overview of what you need to do as a director.

The responsibilities of a director of a company are primarily outlined in the Corporations Act 2001 and include:

• Acting in good faith and in the best interests of the company as a whole, rather than just in the interests of one particular group or individual.
• Exercising their powers for a proper purpose and not for an improper purpose such as to gain an advantage for themselves or someone else.
• Disclosing any conflicts of interest to the other directors and not participating in any decisions where there is a conflict.
• Not misusing their position to gain an advantage for themselves or someone else, or to cause detriment to the company.
• Not misusing company information for personal gain or to benefit others.
• Ensuring the company complies with all relevant laws and regulations, including those relating to financial reporting and compliance with the Australian Securities and Investments Commission (ASIC).
• Ensuring the company keeps accurate financial records and prepares financial statements that give a true and fair view of the company’s financial position and performance.
• Attending and participating in board meetings and making informed decisions.
• Being informed about the company’s affairs and performance, including its financial position and any significant risks or opportunities.
• In addition to the above, a Director also has the responsibility to act with care and diligence, to disclose any material personal interest in any proposed transaction or arrangement, and to not retain any property of the company.

It’s important to note that Directors may also have additional responsibilities under other laws, depending on the nature and activities of the company.

Being a director can be scary. And this is especially true if you are on your own. You have no-one to discuss these matters with on a day-to-day basis.

And that is why it is so important to speak with someone who has been there and worked as a director across many countries and industries, for almost 30 years. So, if you need to have that support person to help you along the way, you better call for the Superhero Accountant!