1. Company Law — Lecture 11 ■ Types of directors ■ Board composition in New Zealand’s largest companies ■ Appointment, resignation, removal and disqualification of directors ■ How boards operate in practice

2. Types of directors Companies must have at least one director Executive directors —chief executive officer/managing director —others (eg finance director) Non-executive directors —definition of “independence” Chairperson Governing director Nominee director Alternate director De facto director

3. Types of directors (cont) Shadow director —Standard Chartered Bank of Australia v Antico —Kuwait Asia Bank case —Dairy Containers Ltd v NZI Bank Professional advisers Shareholders as directors

4. Appointment of directors Who can be appointed? —a natural person —someone who consents —minimum of 18 years old —not disqualified

5. How appointed? New companies —directors named in application for incorporation Existing companies —by ordinary resolution —each director to be voted on individually

6. Resignation and removal of directors Removal by shareholders —s 151 of the Companies Act 1993 by ordinary resolution of shareholders —meeting notice to specify purpose —check constitution for alternative procedure Removal by court —s 174(2) on application of shareholder —oppressive, unfairly discriminatory or unfairly prejudicial conduct

7. Disqualification of directors Under the Companies Act 1955 —offences —court order —prohibition by Registrar of Companies Under the Companies Act 1993 —offences (s 382) —court disqualification (s 383) —by Registrar of Companies (s 385)

8. Automatic disqualification Bankruptcy Mental incapacity

9. Proceedings of the board Who can call a meeting? Notice requirements Quorum Decision-making Use of technology —schedule 3, Companies Act 1993 —check the company’s constitution

10. Delegation of board powers Section 130 delegation to —committee of directors —single director —Employees Audit Committee Remuneration Committee Delegation to CEO

11. Directors’ rights to information Section 191 of the Companies Act 1993 —inspection of records —prevention