Who can be a director of a company in Australia? A practical guide

Wed, 01 Jul 2026 08:52:32 GMT

Director changes are common, but getting the process right matters

Boards evolve over time. New directors are appointed to bring fresh experience, others step down as businesses grow, and sometimes a change is needed to support the company's next stage.

Every change brings legal and governance responsibilities. At Hardies Lawyers , we've worked alongside boards and company secretaries long enough to know that getting the paperwork right is only part of the job. Good governance starts with following the correct process from the outset.

A question we're often asked is who can be a director of a company in Australia? The eligibility rules are relatively straightforward, but the appointment or removal of a director still needs to comply with Australian law, your company constitution, and ASIC requirements. If your company is listed on ASX, there may also be additional governance considerations to keep in mind.

This guide explains who can become a company director, how directors are appointed and removed, and the practical steps that help companies stay compliant throughout the process.

Who can be a director of a company in Australia?

The Corporations Act 2001 (Cth) ( Corporations Act ) sets out the basic eligibility requirements for company directors, but meeting those requirements is only the first step.

So, who can be a director of a company in Australia?

In most cases, a director must:

be at least 18 years old;
provide written consent to act as a director;
hold a Director Identification Number ( Director ID ); and
not be disqualified from managing corporations under Australian law.

For proprietary companies, at least one director must ordinarily reside in Australia. Public companies have additional board composition requirements, including a minimum of 3 directors, with at least 2 ordinarily residing in Australia.

It's also important to check your company constitution before making an appointment. Many constitutions contain provisions about how directors are appointed, who has the authority to approve appointments, and when shareholder approval is required.

Appointing a new director

Once you've identified the right candidate, there are several steps to complete before the appointment is finalised.

Obtain written consent

Every director must provide written consent to act before their appointment takes effect. This document should be retained with your company's records.

Confirm Director ID requirements

All directors are required to have a Director ID issued by Australian Business Registry Services . If your proposed director doesn't already have one, they should apply before, or as soon as possible after, their appointment.

Check your company constitution

Your constitution may set out specific procedures for appointing directors. Depending on how your company is structured, the appointment may require a board resolution, shareholder approval, or both.

Skipping this step can create unnecessary governance issues later.

Pass the appropriate resolutions

The appointment should be properly documented through board minutes or written resolutions. Good record keeping provides a clear audit trail and demonstrates sound corporate governance practices.

Notify ASIC

Once the appointment takes effect, the Australian Securities & Investments Commission ( A SIC ) must be notified within 28 days using the appropriate form. Your internal register of directors should also be updated so your corporate records remain accurate.

Removing or replacing a director

Director changes don't always happen because someone is joining the board. Directors retire, resign, move into different roles, or leave as part of broader governance changes.

The process will depend on the circumstances and your company's governing documents.

Director resignations

A director can resign by providing written notice to the company. The resignation usually takes effect on the date specified in that notice or, if no date is provided, when the notice is received. In all cases, the resignation must be clear and unequivocal.

The company is then responsible for notifying ASIC within the required timeframe.

Removal by shareholders

Shareholders may also have the power to remove a director, although the process varies depending on the type of company and the terms of the company's constitution.

For many companies, an ordinary resolution of shareholders is sufficient. Listed companies and public companies may have additional procedural requirements that need to be followed carefully.

Before taking any action, review both the Corporations Act and your company constitution. The legislation provides the legal framework, while the constitution often contains the practical rules that apply to your business.

Governance doesn't stop with ASIC

Many people think the process ends once ASIC has been notified. In reality, that's only one part of good governance.

Every director appointment or resignation is an opportunity to review your company's governance framework and ensure your records remain up to date.

That includes:

updating statutory registers;
recording board and shareholder resolutions;
reviewing delegated authorities where required;
updating governance policies and board records; and
considering any market disclosure obligations.

For listed entities, director changes may also trigger obligations under the ASX Listing Rules . Depending on the circumstances, announcements may need to be made promptly to keep the market informed.

Strong governance builds confidence with shareholders, investors, regulators, and other stakeholders. Small administrative oversights can quickly become compliance issues if processes aren't followed consistently.

Common mistakes to avoid

Most director appointments and resignations are straightforward. Problems usually arise because a simple step has been missed.

Some of the most common issues we see include:

appointing a director before obtaining written consent;
forgetting to notify ASIC within the required timeframe;
failing to update the company's statutory registers;
overlooking provisions in the company constitution;
assuming every appointment or removal follows the same process; and
missing governance or disclosure obligations for listed companies.

Taking the time to complete each step properly helps reduce risk and avoids unnecessary complications later.

Getting director appointments right

Changing directors is part of the natural evolution of any company. A well-managed appointment or resignation helps maintain compliance, supports strong governance, and provides confidence to shareholders and regulators.

Understanding who can be a director of a company in Australia is a good starting point, but every board should also have clear processes for appointing, removing, and recording director changes. Keeping your governance framework up to date today can prevent costly issues tomorrow.

Need advice on your corporate governance obligations?

At Hardies Lawyers , we work closely with directors, boards, and company secretaries to help companies manage governance and compliance with ease. From director appointments and board restructures to ongoing corporate compliance, we provide practical advice that's tailored to your business.

Get in touch with Hardies Lawyers to discuss your governance requirements or learn how we can support your board with ongoing corporate compliance.

Disclaimer : This article is for educational purposes only and does not constitute legal advice. You should seek legal or other professional advice before acting or relying on any of the content.

hardies-lawyers