The Corporations and Markets Advisory Committee (CAMAC) has published its report on Corporate duties below board level (pdf). In recognition of the fact that many corporate decisions are made by managers, the report generally recommends aligning the liability of managers to that of directors.
CAMAC accepted 11 of the 12 recommendations of the HIH Royal Commission Report.
The report’s recommendations include:
- application of the duties in ss 180 (care and diligence) and 181 (good faith and proper purpose) to directors and corporate officers and ‘any other person who takes part, or is concerned, in the management of that corporation’.
- extension of the prohibitions in ss 182 and 183 (dealing with improper use of corporate position or corporate information) beyond directors, other officers and employees of a corporation to ‘any other person who performs functions, or otherwise acts, for or on behalf of that corporation’. This is to ensure that a person who performs functions for a company cannot avoid these prohibitions, designed to protect the interests of a company and its shareholders, because that person is not technically an officer or employee
- for similar reasons, extension of the prohibitions in ss 1309 (providing false information to various parties, including a director, auditor or shareholder) and 1307 (falsifying or destroying corporate records) beyond officers and employees of a corporation to ‘any other person who performs functions, or otherwise acts, for or on behalf of that corporation’.
The report did not recommend there should be a general provision prohibiting individuals from acting dishonestly in connection with the performance of any statutory obligation imposed on a corporation.
Managers will be entitled to take advantage of the "business judgment" rule and be indemnified by the company to the same extent as directors.