Lombard Case Shows Directors Need To Be Diligent
INSTITUTE of DIRECTORS
Lombard Case Shows Directors Need To Be Diligent, Says Institute of Directors President
“Because of the lack of criminal intent, recognised by Justice Robert Dobson, it is satisfying that the defendants have not received custodial sentences,” said President of the Institute of Directors, Denham Shale, in a public statement following the sentencing of the former directors of Lombard Finance & Investments Limited earlier today.
“However, the decision in this case has highlighted the fact that all who aspire to the position of company director must be diligent and need to be aware of their responsibilities and be prepared to give the necessary time and attention to the consideration of all matters surrounding their duties as a director.”
He said that the matters in respect of which the defendants have been found guilty evidence the manner in which some directors have not been fulfilling their clear responsibilities by leaving it to company executives and advisors to make decisions and give advice relative to directors’ responsibilities.
Mr Shale added, “It is also imperative that directors understand the financial affairs of the companies of which they are a director. Whenever they are uncertain as to the ramifications or other outcomes arising from the financial statements of their company, directors should ask the pertinent questions and obtain the necessary advice which will enable them to be able to make the necessary decisions on a proper basis.”