This is a service specifically targeted at the needs of busy non-executive directors. We aim to give you a “heads up” on the things that matter for NEDs in the week ahead – all in two minutes or less.

In this Edition, we consider ASIC’s guidance on board oversight of executive pay decisions, the sunset of temporary amendments to the Corporations Act permitting virtual meetings and electronic execution of documents, proposed amendments to income tax legislation in relation to deductible gift recipient endorsements and the Takeover Panel’s confirmation of its position on questioning the correctness of expert’s reports. We also look ahead to anticipated trends in M&A activity for 2021.


ASIC updates Information Sheet 245 on Board oversight of executive pay decisions. Last year, ASIC published its Information Sheet 245 Board oversight of executive variable pay decisions during the COVID-19 pandemic. ASIC has now updated this guidance to reflect a broader context beyond COVID-19. The Information Sheet sets out factors that boards should consider when overseeing and making executive variable pay decisions, such as the importance of those decisions being transparently recorded and communicated. The Information Sheet was informed by ASIC’s 2019 review of remuneration governance practices across ASX100 companies. While intended for large listed companies, ASIC notes many of the key principles in the Information Sheet can be adopted by a broader range of companies.  While there is nothing particularly revolutionary in the ASIC guidance, Directors (particularly those on Nomination and Remuneration Committees) may wish to review the document to gain an insight into the regulator’s expectations in this area.


COVID-19 temporary measures allowing electronic execution and virtual meetings expired on 21 March 2021. Temporary amendments to the Corporations Act allowing electronic execution of documents and virtual meetings have now expired. As reported in recent editions of Boardroom Brief, the Government is considering the Treasury Laws Amendment (2021 Measures No.1) Bill 2021, which would extend temporary amendments to the Corporations Act enabling electronic execution of documents. However, the Government has not yet passed the Bill. Therefore, until such time as the Bill is passed (noting Senate has adjourned debate on the Bill until 3 August 2021) directors will need to exercise caution when deciding whether to electronically execute documents. Given the divergence of opinion as to the validity of electronic execution, we recommend that directors err on the side of caution and execute documents by wet-ink signing (noting that NSW and Victoria have separate permanent and temporary measures permitting electronic execution in certain circumstances which remain in effect). The expiry of the temporary amendments will not affect the validity of the electronic execution of documents prior to 21 March 2021. See G+T articles on the impacts of the sunset of these temporary measures on electronic execution and virtual meetings.

Proposed amendments to requirements for deductible gift recipient (DGR)  endorsements. Directors of not-for-profit entities should note that the Treasury Laws Amendment (2021 Measures No 2) Bill 2021 (Cth) has been introduced in the House of Representatives. The Bill proposes to amend the Income Tax Assessment Act 1997 (Cth) to require, as a precondition for deductible gift recipient endorsement, that a fund, authority or institution be either a registered charity, Australian government agency or be operated by one of these entities. Existing deductible gift recipients will have an additional 12 months before the amendments apply.  The requirements for endorsement as a DGR have been tightened over the past few years, and this latest move represents a continuation of that trend.

Takeover Panel confirms the high threshold required to question expert’s reports. The Takeovers Panel has declined to conduct proceedings in The Agency Group Australia Limited 03R [2021] ATP 5. This was a review application brought by a bidder which, amongst other things, sought that The Agency Group obtain a new independent expert’s report in connection with a proposed vote under item 7 of section 611 of the Corporations Act. In its reasons for this decision, the Panel confirmed that high thresholds apply for the Panel to be justified in questioning the conclusions of an expert’s report. The Panel noted it will not undertake such inquiries in relation to an expert’s report in the absence of strong preliminary indications of a clear fault in methodology, plainly false material statements, the expert having reached a conclusion which no reasonable expert could reasonably arrive at or a question as to the expert’s independence. The Panel suggests that in considering these factors, it may be guided by any concerns raised by ASIC (or lack thereof). 


Significant M&A activity expected for 2021. M&A is clearly on the rise with a number of potential multi-billion dollar deals (or potential deals) already announced in the first six weeks of 2021, involving AMP, Bingo Industries, Vocus, Tilt Renewables, Tabcorp and (at the time of writing) Crown Resorts. The ingredients for M&A are present including business confidence, availability of finance and vaccine rollouts in full swing. In this respect, 2021 promises to be a very strong year for M&A. More specifically, a resurgence of M&A activity in the health, aged care and pharmaceutical related sectors is expected for this year. Financial services may also continue to see significant M&A activity this year. In addition, industries affected by the pandemic, such as leisure and hospitality, may become the focus of M&A as economies emerge from the pandemic. For a wrap up on the 2020 calendar year, and further predictions on the year ahead, see G+T’s summary of its 2020 Takeovers + Schemes Review, which was released last week. 

Expertise Area