09-69 James Hardie proceedings
Thursday 23 April 2009
ASIC said today’s decision in its civil penalty proceedings against seven former non-executive directors and three former executives of James Hardie and against James Hardie Industries NV (JHINV - based in the Netherlands) and James Hardie Industries Limited (JHIL - the former Australian listed entity) is a landmark decision in Australia on corporate governance.
Today’s decision of the New South Wales Supreme Court provides boardrooms with important guidance and direction on:
- the practical application of the scope and content of the duties of executives (chief executives, company secretaries and chief financial officers) when taking important matters to the Board and disclosing those matters to the market; and
- the responsibilities of non-executive directors of public companies when asked by management to consider strategic matters and to approve disclosure to the market of the Board's decisions.
In addition, the findings against JHIL and JHINV illustrate that in making statements to the market, companies must carefully assess and check the veracity of those statements.
ASIC Chairman Tony D’Aloisio welcomed the Court’s decision:
‘I encourage Boards to carefully consider this decision and assess what improvements they can make to their decision making processes, the way they convey decisions to the market and in the way they conduct investor briefings and so called road shows,’ he said.
‘The decision is another important step in improving corporate governance in Australia and that improvement will add confidence to the integrity of our markets.
‘This confidence will be particularly important as we emerge from the financial crisis and companies come to the market to raise funds for new investments, much needed for the recovery of the real economy’, Mr D’Aloisio said.
Background
Table of findings
A table identifying contraventions determined by the Court in respect of individual defendants is attached.
Next stage of proceedings
The matter has been stood over to a later date (at a date to be fixed). At that hearing the judge will, in the usual way, consider penalties and submissions by the defendants relating to penalties.
Table of contraventions
Previous releases on James Hardie
ASIC Website: Printed 02/10/2010
