Role of shareholders

The Role of shareholders guidance note provides expert insights into the proprietary and governance interests of company members, focusing on their essential powers and rights under the Corporations Act 2001 (Cth) and company constitutions. This document outlines the strategic functions shareholders perform in corporate decision-making, control of directors, and governance mechanisms, highlighting critical legal nuances that practitioners must navigate.

Topics Covered

• Role of shareholders as owners
• Decisions that are made by members
• Division of powers between directors and members
• Members' redress if not satisfied with directors' decisions
• Members' rights to requisition general meetings, propose resolutions and distribute statements
• Other remedies available to members

Essential Insights

• Understand how shareholders’ proprietary interests translate into critical voting and decision-making authority.
• Assess the scope of members’ powers to modify constitutions, appoint or remove directors, and approve significant corporate changes.
• Recognise the complex interplay between the board’s management powers and members’ reserved statutory rights under the Corporations Act.
• Explore strategic considerations for calling general meetings and requisitioning resolutions, including statutory thresholds and procedural essentials.
• Identify key remedies available to members when directors’ actions conflict with members’ interests, including derivative and oppression remedies.
• Navigate the legal requirements and timing restrictions for shareholder resolutions to ensure compliance and effectiveness.