Is our corporate regime causing directors to be overly cautious when making decisions, particularly in fast-moving and complex business situations?

In a speech  to ASIC’s Summer School by Minister for Superannuation and Corporate Law Nick Sherry (delivered by Treasury Secretary Ken Henry) it was announced that Treasury is examining these issues to improve and clarify the corporate governance regime and will consult widely with industry and the regulators:

The Minister believes that it is important that this project looks beyond the Corporations Act to examine issues such as the emerging trend for other legislation to impose personal liability on company officers for corporate fault.

It is important that corporate law reflect modern thinking about the use of criminal, civil and administrative sanctions for misconduct, while also permitting flexibility in decision-making. The Minister has indicated to Treasury that this is a high priority project.

The speech also highlighted two key areas which the Government has identified as areas requiring review — executive remuneration and corporate sustainability reporting.