DIRECTORS NEED TO KNOW THEIR OBLIGATIONS DURING BOOM TIMES

Directors need to know their obligations during boom times

Directors of Australia’s listed companies need to exercise caution and to pay particular attention to their corporate governance procedures during this time of high merger and acquisition and corporate activity,
The Australian Institute of Company Directors (AICD) warned today.

Mr Ralph Evans, chief executive officer of the AICD urged directors of listed companies to be meticulous in their corporate governance processes during any M&A or corporate transaction activity, particularly in the areas of disclosure and where there was potential for conflicts of interest.

For more see media release attached above

AICD Position Paper

DIRECTORS OBLIGATIONS DURING BOOM TIME ACTIVITY

Key Points:

• More than ever, directors need to be aware of their obligations under the Corporations Law and ASX Listing Rules during this era of increased M&A and corporate activity
• Directors must not place themselves in a position where there is an actual or substantial possibility of conflict between a personal interest or a duty owed elsewhere and the director’s duty to act in the best interests of the company
• Three main areas of concern are:
  • Continuous disclosure
  • Conflicts of interest
  • Directors’ responsibilities and duties to the companies they serve
• Directors need to be well-versed and trained on their roles and responsibilities and aware of potential risks

For more see position paper attached above titled 'Director Conflicts'