Directors' Duties

QR Directors have ultimate responsibility for the overall successful operations of the organisation. Each Director’s duties relate to:

• financial operations and solvency
• all matters as prescribed by law, including, but not limited to, safety and the environment
• all major policy issues, including, but not limited to, industrial relations and quality assurance
• the strategic direction of QR.    

Duties of a Director

Part 12 of the GOC Act refers to the duties and liabilities of Officers of a statutory GOC. The term ‘Officer’ as used in Part 12 means any Director, the Chief Executive Officer, and any other person who takes part in the management of QR.

While the provisions of the Corporations Act 2001 (and the previous Corporations Law) effectively codify aspects of the fundamental fiduciary duties owed by Directors of companies, these provisions do not apply to Officers of a statutory GOC .

However, Part 12 of the GOC Act contains provisions similar to those contained in the Corporations Act, which do apply to Directors of a statutory GOC and, in particular, create the following statutory duties:

• the duty to act honestly
• the duty to exercise a reasonable degree of care and diligence
• the duty not to make improper use of information received as an Officer of a statutory GOC for the benefit (direct or indirect) of themself or another, or to cause detriment to the GOC
• the duty not to make improper use of their position as an Officer of a statutory GOC for the benefit of themself or another, or cause detriment to the GOC
• the duty to take all reasonable steps to prevent insolvent trading by the statutory GOC.    

Each of the statutory duties created under Part 12 of the Act imposes financial penalties for contraventions by Directors of the GOC. Directors are also bound by the duty of care and diligence standards under the Corporations Act 2001. Any breach under this Act may result in terms of imprisonment of one to five years. The penalty that may be imposed can vary in certain circumstances.

Penalties can be increased by circumstances of aggravation (e.g. intent to deceive or defraud where there is a breach of the statutory duty of honesty). Penalties can also be ameliorated by circumstances (e.g. in determining the level of care and diligence required) or the availability of specified defences (where there has been a failure to prevent insolvent trading).

In addition to these statutory penalties, a Director of a statutory GOC may face action by the GOC to recover a debt due to the GOC:

• any profit made by that Officer or another
• the amount of any loss or damage suffered
• such part of any debts incurred by the GOC as a court determines.    

These are in addition to the confiscation of property under the Crimes (Confiscation) Act 1989. 

Finally, a Director of a statutory GOC may also face civil liability for breach of any relevant fiduciary duty or other common law obligations.

Directors also have common law duties to which they must adhere.

Directors should, in good faith, behave in a manner that is consistent with generally accepted procedures for the conduct of meetings at all meetings of the Board. This will include, but is not limited to:

• acting in accordance with the GOC Act and the Statement of Corporate Intent and Corporate Plan
• accepting the direction of the Chairman in respect to ensuring the good spirited conduct of any meeting.   

Directors will disclose to the Board actual or potential conflicts of interest and take all necessary action to avoid any such conflicts of interest or improper use of their position.

Directors are expected to undertake individual reading or research, attend any seminars or conferences and undertake other activities that will enhance their contribution to the Board. Directors are also expected to undertake individual professional development during the term of their appointment to continually enhance their skills and corporate governance knowledge.

Legislative Interest List

Directors should be familiar with the body of legislation that can provide personal exposure and risk to the organisation. Such legislation operates at the Commonwealth level as well as the Queensland State level, and includes local authority bylaws.

Such legislation includes, but is not limited to:

• the Government Owned Corporations Act 1993
• the Corporations Act 2001
• the Trade Practices Act 1974
• the Financial Administration and Audit Act 1977
• Environment Laws
• Employment Law
• Occupational Health and Safety Laws
• Intellectual Property Law   

Directors should also be familiar with the aims and requirements of National Competition Policy, the Australian Accounting Standards and the Financial Management Standard 1997.

QR Board Directors who are also Directors of a Subsidiary

A QR Board member who is also a director of a wholly-owned subsidiary must act in the best interest of the parent company.