What is The Roles and Responsibilities of The Company Director and The Company Secretary?

Company directors and company secretaries are known as the ‘officers’ of a company. Office bearers, such as directors and a secretary, can be appointed by the company’s members and directors at the time of registering the new company with ASIC. Such appointments must be made in accordance with the Replaceable Rules set out in the Corporations Act 2001 or, if the company has one, in line with the terms and conditions of its own constitution.

Anyone wishing to accept an appointment as a director or secretary must give their written consent, which needs to be kept on file by the company. The company also needs to inform ASIC that particular offices have been appointed to their roles.

It is acceptable for one individual to act in both the role of a company director and a company secretary.

The main role that must be filled by the company director is to actually manage the company’s business and affairs. You need to be 18 years of age before you can become a company director.

The Corporations Act 2001, sets out the core duties that should be performed by a company director. For example, the law says a director must act with care and diligence, act in good faith and not to use their role improperly.

The main responsibility of the company secretary (or secretaries), on the other hand, is to perform administrative duties for the company and on behalf of directors. It is the company secretary’s role, for example, to take minutes at directors’ or members’ meetings. The company secretary must also keep the company register up to date and lodge all necessary forms with ASIC.

A director or directors can carry out the duties normally performed by a secretary if a company decides not to appoint a secretary.

Both directors and secretaries have a duty to ensure the company doesn’t ‘trade while insolvent’. They are responsible, as officers of the company, to ensure it is able to pay its debts as and when they become payable.

Directors and secretaries may continue to have responsibilities to the company and its members or shareholders, even after the company has been wound up.

A failure to fulfil the duties set out in the Corporations Act 2001 and regulations, may result in directors or company officers being forced to pay fines, fulfil compensation orders, be disqualified from their positions or even go to goal.

Know more about How to register company in Australia.