Director requirements

Number of directors

The rule in the CATSI Act is that a corporation must have at least 3 directors and no more than 12 directors. 

But a corporation can:

• choose another range between 3 and 12, for example a minimum of 5 and no more than 9 directors, or
• apply for an exemption to have fewer than 3 or more than 12 directors, for example a minimum of 1 director.

Individual directors and board composition (majority of director requirements)

Some requirements for directors need to be considered both for the individual person and in the context of the board composition. A person might be eligibile as an individual but appointing them might break one of the majority of director requirements.

Majority of directors must be Indigenous (Indigenous control of the board)

The rule in the CATSI Act is that all corporation directors must be Aboriginal or Torres Strait Islander people. But a corporation can choose to allow non-Indigenous people as directors by putting it in their rule book. So the CATSI Act protects Indigenous control by requiring that a majority of directors be Aboriginal or Torres Strait Islander people. 

Unless a corporation's rule book provides otherwise, all directors of corporations must be individuals who are Aboriginal and/or Torres Strait Islander people.

If a corporation’s rule book allows non-Indigenous directors, a majority of the directors must be Aboriginal and/or Torres Strait Islander people.

If you have 2 members and one is non-Indigenous you must show Aboriginal and Torres Strait Islander control through your director positions: 

• If just the Aboriginal and Torres Strait Islander member is a director, you must have an independent director who is also an Aboriginal or Torres Strait Islander person (total of 2 director positions; both filled by Indigenous people).
• If the non-Indigenous member is also a director, you must have at least one other director (total of 3 directors) and maintain a majority of Aboriginal or Torres Strait Islander people as directors.

If your corporation has directors representing corporate members, a majority must be Aboriginal or Torres Strait Islander people. 

Majority of directors must be members (member control of the board)

The CATSI Act was designed with member-controlled corporations in mind so it requires that the majority of the board be members. 

The rule in the CATSI Act is that a director must be a member of the corporation. But a corporation can change this to allow non-members to become directors by putting it in their rule book. So the CATSI Act protects member control by requiing the majority of directors also be members.

Majority of directors must live in Australia

A majority of the directors of the corporation must ordinarily reside in Australia.

Majority of directors must not be employees

A majority of the directors of the corporation must not be employees of the corporation.

If a person is a chief executive officer (or your corporation's equivalent senior management role) they can be a director but cannot chair directors' meetings.

Age of directors

To be a director you must be least 18 years old.

Disqualification

To be a director you cannot be disqualified from managing Aboriginal and Torres Strait Islander corporations under the CATSI Act.

Must give consent and make a declaration

Before a person can be appointed or re-appointed as a director they must give their consent in writing. The consent also includes a declaration that they are eligible to be a director.

The corporation must keep a copy of this consent.