Pursuing profit, productivity and philanthropy: the legal obligations facing corporate Australia

Title:	Pursuing profit, productivity and philanthropy: the legal obligations facing corporate Australia
Author:	Leah Watterson and Quentin Digby
Type:	Paper
Focus:	Legal obligations relating to corporate giving in Australia
Date:
Publisher:	Freehills; Community Business Partnership
Download:	Download PDF from Community Business Partnership website

This paper comments on the company law principles applying to corporate giving in Australia. Summary extract from the paper:

the Corporations Act provides Australian companies with the power to make charitable donations;
but the exercise of the corporation’s power to make donations must be in compliance with applicable laws, including the laws dealing with directors’ duties and may be further limited by specific restrictions in the constitution of the company, or any contractual obligations entered into (for example security documents);
directors of companies are subject to both statutory and fiduciary duties when making charitable donations out of corporate funds;
the proper exercise of the power to make charitable donations will depend on the size of the gift, the motivation for the donation, the decision-making process followed and the financial health of the corporation at the time the donation is made;
particular care needs to be exercised by directors where they have a personal interest in the charity which will benefit from a corporate gift.