corporate governance

Shareholder oppression – a taxonomy of corporate wrongs

Shareholder oppression (Oppression) is the business battleground where equity holders fight for their share of the business’ equity value.  Unfortunately, it is all too common.  Oppressive conduct (Conduct) is broadly defined in section 232 of the Corporations Act 2001 (Cth) (Act) as when: [Read more…]

Shareholder’s inspection allowed despite distrust

The case of Rasley (Singapore) Pte Ltd v Financial & Energy Exchange Ltd [2020] FCA 1462 involved an application to the Federal Court by a shareholder (Rasley (Singapore) Pte Ltd) (Rasley/Plaintiff) to inspect the books of the defendant (Financial & Energy Exchange Ltd) (Financial/Defendant) pursuant to section 247A of the Corporations Act 2001(Cth) and at common law because of its standing as a shareholder. Section 247A provides that the Court may only make orders if it is satisfied that an applicant is acting in good faith and for a proper purpose. [Read more…]

What is a risk management framework?

A risk management framework is a key component of an overall governance framework.   As the name suggests it focuses on risks faced by the business.  Typically, a governance framework will document the approach an organisation takes to managing risks and include details of:

  • Risk appetite – being a measure of the level of risk an organisation is willing to assume;
  • Risk tolerance – being a measure of the amount of risk an organisation is capable of absorbing; and
  • Risks – being details of the types of risk which the organisation faces and seeks to avoid, mitigate or accept.

In developing a risk management framework an organisation should refer to AS ISO 31000:2018 Risk Management Guidelines which sets out the process principles and framework for risk management.

[Read more…]

Shareholders’ right to information

One of the tell tale signs of a shareholders’ dispute occurs when those with the access to information restrict access to it for others.  It’s very common for us to see this.  There are several reasons why a shareholder may require company information, primarily where a minority or oppressed shareholder loses control and is removed as a director.  There may be reasonable suspicions that the company is financially unstable or the conduct is oppressive to its shareholders.  These scenarios mean that a shareholder is not being provided with the full information on whether they are being oppressed.  On its face the aggrieved shareholder may think that little can be done.  This is not the case as the Corporations Act 2001 (Cth) (Act) provides for various mechanism for minority shareholders to obtain relevant information from the company.   [Read more…]

Corporate governance standards for not for profits

The vagaries of corporate governance is a regular and sometimes controversial topic of discussion in Australian business circles.  It is also the subject of much judicial interpretation.

On 1 July 2013 the Australian Charities and Not‑for‑profits Commission Amendment Regulation 2013 (No. 1) (Cth) (Regulations) came into effect by amending the Australian Charities and Not‑for‑profits Commission Act 2013 (Cth). [Read more…]

What is a Corporate Governance Framework?

The term ‘corporate governance’ is often bandied about, but rarely explained in the context of a framework which can be applied to a variety of enterprise types.

So what is it?  Corporate governance is traditionally thought of as the way in which enterprises are directed and controlled.  More recently, corporate governance has been defined as the framework of rules and procedures by which the decisions in an enterprise are made, and how the controllers and held accountable for them.  The term, ‘enterprise’ refers to all types of associations, companies, trusts and other hybrid entities that provide a product or service (Enterprise).

[Read more…]

Why do we need a Privacy Act Compliance Audit (PACA)?

What is a Privacy Act compliance audit?

Businesses have responsibilities pursuant to the Privacy Act 1988 (Cth) (Privacy Act) to make sure that they comply with the ten (10) National Privacy Principles (NPP) in accordance with the Privacy Act.

A Privacy Act Compliance Audit (PACA) is a threshold assessment that assists an organisation to determine whether or not they are compliant with the Privacy Act.  Further, a PACA can provide an organisation with practical go forward methodologies about the way that they collect, hold, use and disclose an individual’s personal information.

At present businesses are preparing to review their processes as legislative amendments come into force in March 2014.  At this time, further obligations will be imposed by the Privacy Act.  This means that they must adhere to a new set of privacy principles called the Australian Privacy Principles (APPs).  Read a summary of the changes here. [Read more…]

Corporate Governance – A leverage point

By Lloyd Russell, Principal -TCB Solutions

Corporate governance means different things to different people and sadly in most family and private businesses this is considered to be the domain of the Accountant or Lawyer While these two critical stakeholders have a crucial role to play in the governance of your business they cannot assist with the development and embedding of the system within the businesses operations. [Read more…]

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