Director's Responsibilities

Becoming a director of a company should not be taken lightly. Always acting in good faith, in the best interests of the company and for a proper purpose, in amongst the many and often conflicting business objectives and stakeholder interests, are easier said than done. Failing to perform duties as a director can bring about serious consequences, including personal liability for loss or damage suffered by the company, criminal penalties (including a jail term of up to 5 years or AU$ 200,000 or both), civil penalties (of up to AU$ 200,000) and prohibition from managing a company.

We have assisted many multinational corporations and government agencies with the appointment of resident and non-resident directors to their Australian operations and with properly discharging the duties of their directors in Australia.

Professionals

Yukio Hayashi

Partner

Kenneth Hong

Partner

Related Insights

Director's Responsibilities,Director's Duties Disputes

03 October 2025

Directors’ Duties: Lessons from Recent Case Law

Australia is often viewed as one of the most heavily regulated jurisdictions in the area of corporate governance. On the one hand, it reflects a strong commitment to transparency, accountability and the protection of stakeholders’ interest, but on the other hand it poses a challenge for those looking to navigate the corporate regulatory landscape – all the more so for those not familiar with the Australian framework. When an offshore investor sets up shop in Australia or acquires a local company, often the first step taken is the appointment of a new director. Their role is not merely symbolic or perfunctory – the law imposes extensive duties on company directors, many of which are codified in the Corporations Act 2001 (Cth) (the Act). Directors owe a fiduciary duty to their company, meaning that they are required to act in good faith in the best interests of the company, exercise due care and diligence, and not misuse their position or information obtained by reason of their position. Recent judicial decisions, such as the New South Wales Court of Appeal’s ruling in Sunnya Pty Ltd v He [2025] NSWCA 79 (Sunnya decision), have further cemented the expansiveness of the scope of these obligations.

Director's Responsibilities,Corporate Advisory, M&A,Director's Duties Disputes,Shareholders, Partnership & Joint Venture Disputes,Corporate Governance

27 October 2021

When quorum cannot be constituted at shareholders’ meetings

In a dispute between shareholder and director or joint venture partners, particularly of a small proprietary company, or when company affairs are in deadlock, a common method of opposition by a shareholder is to refuse to attend a shareholders’ meeting so the necessary quorum is not present and the resolutions cannot be passed. In such circumstances, court may intervene to convene a meeting and prescribe a quorum. Section 249G of the Corporations Act 2001 (Cth) (Corporations Act) provides that: "249G – Calling of Meetings of Members by the Court 1. The Court may order a meeting of the company's members to be called if it is impracticable to call the meeting in any other way.