Directors' Circulating Resolution (General)

Under the Corporations Act 2001 (Cth), most of the decisions that affect your company will need to be recorded using a Directors' Resolution. This document is general purpose, allowing you to record any number of changes passed by your company. In addition to this general-purpose resolution, Lawpath also offers specific resolutions (for example, to appoint or remove an existing officeholder). To be effective, this resolution must be signed by all of the company's directors.

For particular changes, it is important that this is recorded as you have 28 days within which to notify ASIC of this change from the date it is made. If ASIC is not notified within this period, fines will apply.

Use a Directors Circulating Resolution (General) if:

• You are a director of a company
• You need to record one or more decisions made by your company

What does a Directors Circulating Resolution (General) provide?

• Details of the resolution
• Confirmation that ASIC will be notified of this change

What does the Board of Directors do?

A Board of Directors looks after the an organisation’s overall governance, strategic direction and management. It also will help to ensure that the organisation performs in accordance to its goals and objectives.

Because this article seeks to explain how a BoD works, let’s take a deeper dive into specifying what their responsibilities are. There are two main aspects:

Performance

On an external level, the BoD formulates strategies that will enable the organisation to meet its performance goals. Internally, a key responsibility for the BoD is to make policy that drives them to perform in line with objectives.

Compliance

On an external basis, the BoD is in charge of ensuring accountability for the organisation as perceived by the public. Internally, the BoD will similarly monitor and supervise the organisation from a top management level perspective.

Who can be a Director?

A Board of Directors should include people from a wealth of different backgrounds and expertise. Each director can benefit the board because of their specific skillsets, knowledge and experiences from varying areas of business.

Election Process

If the organisation is a public company, the BoD is elected by the shareholders. This often applies for smaller companies as well, however the methods of election do vary.

Removal Process

Removals can occur if a Director fails to meet their obligations or where they overtly break any rules. A Director cannot remove another Director from a public company. However, shareholders can remove a director through a resolution or simply not re-electing them.

Relevant Laws

Each director has duties, legally imposed upon them by the Corporations Act 2001 (Cth). A company director can remove other directors for a Pty Ltd company. However, this also depends on the terms of the Company Constitution.

Other documents you may need:

• Directors Resolution to Appoint a New Officeholder
• Shareholder Meeting Minutes