Commonwealth Consolidated Acts Commonwealth Consolidated Acts(1) A Board member must exercise his or her powers and discharge his or her duties with the degree of care and diligence that a reasonable person would exercise if he or she:
(a) were a Board member in the Board's circumstances; and
(b) occupied the office held by, and had the same responsibilities within the Board as, the Board member.
Note: This is a civil penalty provision which is enforced under the Regulatory Powers (Standard Provisions) Act 2014 (see Subdivision C of this Division).
Civil penalty: 2,000 penalty units.
Business judgment rule
(2) A Board member who makes a business judgment is taken to meet the requirements of subsection (1), and their equivalent duties at common law and in equity, in respect of the judgment if he or she:
(a) makes the judgment in good faith for a proper purpose; and
(b) does not have a material personal interest in the subject matter of the judgment; and
(c) informs himself or herself about the subject matter of the judgment to the extent he or she reasonably believes to be appropriate; and
(d) rationally believes that the judgment is in the best interests of performing the functions of the Board.
The Board member's belief that the judgment is in the best interests of performing the functions of the Board is a rational one unless the belief is one that no reasonable person in his or her position would hold.