1. Room to improve? How to get your meeting agendas and minutes right Better Boards Conference 5 July 2013 MELBOURNE SYDNEY BRISBANE 1

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3. Agenda Getting agendas and minutes right: 1.Why is it so important? 2.James Hardie Case 3.Putting it into practice 3

4. 1.Why is it so important? 4

5. Recent cases about the actions of directors send a clear message: 1.increasing trend of holding company directors accountable for the actions of a company 2.contents of agendas and minutes have considerable weight Same principles apply to boards of not-for-profit companies and to committees of associations 5

6. Consequences of poor agendas and minutes: 1.reputational damage 2.fines and penalties 3.potential loss of endorsements from the ATO or the ACNC. Get your agendas and minutes right!!! 1.Why is it so important? (cont) 6

7. 2.James Hardie case 7

8. 2.James Hardie Case May 2012 James Hardie case highlights the importance of getting meeting agendas and minutes right Board meeting, February 2001 - directors approved announcement to the ASX about a corporate restructure, announcement released, part of restructure did not eventuate ASIC considered statement in the announcement was misleading and issued proceedings against the directors for breaching their duty of care and diligence under the Corporations Act 8

9. Court proceedings - High Court held in May 2012 that the former James Hardie directors had breached the Corporations Act. Decision essentially turned on: factual finding that the directors had approved the announcement; and signed minutes of the board meeting had a significant part to play in the Court’s decision. 2.James Hardie Case (cont) 9

10. Getting the AGENDA right: Court said the directors had a non-delegable duty to approve the announcement as part of its responsibility to be involved in monitoring the company. Courts yet to fully consider the boundaries of non- delegable duties in relation to the obligation to approve certain announcements BUT the Court indicated boards may be required to approve announcements/press releases that relate to matters that are of considerable importance to the company’s future and/or matters of importance to stakeholders. 10

11. 2.James Hardie Case (cont) Getting the MINUTES right: Minutes were signed by the chairman at the next board meeting in April 2001 - breaching section 251A(1) of the Corporations Act because this was more than 1 month after the meeting The minutes therefore lost their special evidentiary status, highlighting the importance and probative value of minutes 11

12. 2.James Hardie Case (cont) Getting the MINUTES right (cont): Court cautioned directors to make sure they read minutes properly before approving them. Accurate recording of events at a meeting is important. 12

13. 3. Putting it into practice 13

14. 3.Putting it into practice Getting the AGENDA right: Purpose of the agenda is to set out the subject matters that are for discussion at your board/committee meeting Following on from James Hardie, it is clear that directors/committee members should: 1.read all board/committee papers – make sure you understand the underlying facts 2.speak up if you do not understand something 3.beware of non-delegable duties and how to mange them 14

15. 3.Putting it into practice (cont) Agenda checklist: 1.Put the organisation name at the top of the document and the fact that it is a board / committee meeting 2.List the agenda items in a table format – include item numbers, page numbers, person responsible, action required 3.Include: welcome and attendance declaration of interests minutes of the last board/committee meeting 15

16. 3.Putting it into practice (cont) Agenda checklist (cont): 3. Include (cont) matters arising from previous meeting action items circulating resolutions CEO report general business - matters that need critical and detailed attention date of next meeting time the meeting concludes 16

17. 3.Putting it into practice (cont) Getting the MINUTES right: 1.Official record of proceedings and resolutions – primary evidentiary source of what occurred at meeting 2.Getting it right is two-fold: Protect the interests of the organisation Protect the interests of individual directors/committee members 17

18. 3.Putting it into practice (cont) Minutes checklist: 1.Use the past tense and active voice 2.If minutes are prepared before a meeting, prepare them at the same as papers and include substance and amendments after the meeting 3.Scrutinise for accuracy, address concerns before approving 4.Enter minutes into minute book within 1 month after meeting 18

19. 3.Putting it into practice (cont) Minutes checklist (cont): 5. Record details of discussions about: Attendance Welcome Declarations of interest Minutes of previous meeting Action items CEO, financial, committee reports General business Next meeting Closure 19

20. 4. Questions 20

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