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7. What are the roles and responsibilities of the ‘officers’ of a company?

The ‘officers’ of a company are its directors and secretaries. As part of the process of setting up a company, its members or directors can appoint officers in accordance with either the Replaceable Rules set out in the Corporations Act or the company’s own constitution, if it elects to have one.

Before a person can be appointed to the position of director or secretary, they have to give their written consent to take on the role. This consent needs to be kept on record by the company and ASIC must be notified of any officer’s appointment.

The one individual may act as both a director and a company secretary.

It is the responsibility of a company director to manage the business, and other affairs of the company. An individual must be at least 18 years of age before they can become a company director.

Certain directors’ duties are spelt out in the Corporations Act, including a duty to act with care and diligence, to act in good faith and not to use their position or information gained in carrying out their role improperly. They have responsibilities to the company’s shareholders and ‘fiduciary duties’.

The company secretary (or secretaries) are mainly responsible for carrying out administrative duties, for both the company and its directors. For instance, they are required to take minutes at meetings of members’ or directors, the must maintain the company register and they’re responsible for lodging forms with ASIC.

If a company doesn’t elect to have a secretary, such administrative responsibilities will fall to its directors to carry out.

All company officers must exercise specific duties which are spelt out in the Corporations Act. In particular, they must prevent the company from trading while it is insolvent, or unable to pay its debts as and when they fall due.

Their obligations to the company and its shareholders or members may continue even after it has been wound up.

Breaches of the duties set out in the Corporations Act may result in fines, compensation orders, disqualification or even imprisonment so it is important for any individual appointed to an officer’s position, director or secretary, to be fully aware of their duties.