Plain language law

New Zealand law explained for everyone

Companies Act 1993

Directors and their powers and duties - Powers of management

130: Delegation of powers

You could also call this:

“Directors can assign tasks but remain accountable for their completion”

When you’re part of a company’s board, you can let other people do some of your jobs. You can give these jobs to a group of directors, one director, someone who works for the company, or anyone else. But you can’t give away the special jobs listed in Schedule 2 of this law.

Even if you give a job to someone else, you’re still in charge of making sure it’s done right. It’s like when a teacher asks you to help with something - they still need to check you’re doing it correctly. But you won’t be responsible if two things happen: First, you really believed the person would do the job properly and follow the rules. Second, you kept an eye on them to make sure they were doing it right.

Remember, there might be rules in your company’s constitution that say what jobs you can and can’t give to others. You need to follow these rules too.

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View the original legislation for this page at https://legislation.govt.nz/act/public/1986/0120/latest/link.aspx?id=DLM320655.

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Part 8 Directors and their powers and duties
Powers of management

130Delegation of powers

  1. Subject to any restrictions in the constitution of the company, the board of a company may delegate to a committee of directors, a director or employee of the company, or any other person, any 1 or more of its powers other than its powers under any of the sections of this Act set out in Schedule 2.

  2. A board that delegates a power under subsection (1) is responsible for the exercise of the power by the delegate as if the power had been exercised by the board, unless the board—

  3. believed on reasonable grounds at all times before the exercise of the power that the delegate would exercise the power in conformity with the duties imposed on directors of the company by this Act and the company's constitution; and
    1. has monitored, by means of reasonable methods properly used, the exercise of the power by the delegate.