In reviewing recent directors’ duties cases (such as James Hardie and Centro) it is clear that CEO’s, CFO’s, company secretaries and other officers who are not directors are also being held to high standards by the courts and regulators.

Typical of the judgments is that of the NSW Court of Appeal in respect of James Hardie CFO Phillip Morley:

Although we have found that he acted honestly, it does not appear to us that he ought fairly to be excused, or that he should be relieved from liability for the contravention. Proper corporate governance and business activity depend on business leaders adhering to standards not only of honesty but also of care and diligence.

Besides obligations under the Corporations Act, senior company officers may also have obligations as responsible officers or responsible managers under other laws or standards.

You need to regularly confirm that your company has in place Directors’ and Officers’ Liability Insurance which gives you adequate protection in conjunction with the terms of the company’s Constitution and any indemnity deed, unless fraudulent or criminal activity or deliberate or reckless conduct is actually proven. You should keep a copy.