Key roles and responsibilities of a director in Australia

What are the roles & responsibilities of a director?

Whilst the roles and responsibilities of a director are always updating, and differ from country and state; we deep dive this all important topic in Australia.

Who can become a director?

The criteria is quite simple, which is not to say it’s extremely easy to obtain a director ID, and once again, these requirements may be applicable to change, however if you are 18 years or older, must not be undischarged bankrupt, or a disqualified director and consent to the role in writing, then you may be eligible to become a company director. You may need hands on experience too, so always check with your local requirements

What is the role and duties of a director?

To keep it simple, you are responsible for the company’s success! This means financials, people and company management - legally. This is a major responsibility and should be taken seriously. The major duties include - but not limited to:

• Prevent insolvent trading

• Act with care and diligence

• Act in good faith for a proper purpose

• Prevent improper use of position

• Avoid all misuse of information

• Prevents conflicts of interest
  

Have you obtained or applied for your director ID?

A director ID is a 15 digit number provided to a director who has verified their registration with ABRS (part of the ATO). This ID provides a fairer business environment to assist with controlling fraud or false director identities.

Who does a director report to?

In short, directors report to the shareholders and the best interests of the company.

Is a director the same as an officer in a company?

• It can be. An officer can also include but not be limited to:

• A secretary of a corporation

• Any major decision makers for the whole or large part of the company

• Any person who has a significant ability to affect the companies financial standing

• All are required to abide by the law

• Check section 9 of Corporations Act for further information
  

Final thoughts...

Always use the resources available from ASIC, ABRS, ATO, MyGovID and your legal representatives.

If the role of a director is something that interests you, and you need further experience, take active steps to reach that goal. Network, speak to your bosses, obtain a mentor, join groups or classes to improve and educate yourself.

For many people, the role of director is a rewarding one.

All information is general information. ARCS BA are not lawyers or government officials. You should seek your own advice as per the law.