SYDNEY PORTS CORPORATION ANNUAL REPORT 12

96
Sydney PortS CorPoration
Statutory diSCloSureS
2011/12 (Continued)
Strategic risks are identified through a formalised risk
assessment process which is:
■■ coordinated by the Chief Risk Officer (the Chief Risk
Officer for the Corporation is the Chief Financial Officer)
■■ managed by the Executive Management Team
■■ overseen, in the first instance, by the Audit and Risk
Committee and subsequently by the Board.
The strategic risk profile is reviewed monthly by the
Executive Management Team and quarterly by the Audit
and Risk Committee on a formal basis to:
■■ assess the effectiveness of risk mitigation strategies
■■ ensure that any new or emerging risks are identified and
captured
■■ ensure that any previously identified strategic risks and
mitigating actions are monitored.
As part of the annual formal review during the year, a
report was provided from management to the Audit and
Risk Committee and reported to the Board. The report
outlined all the key activities undertaken by the Audit and
Risk Committee, including risk oversight.
Operational risks are reviewed through a formalised risk
assessment process that is conducted within Divisions
and coordinated by the Departmental Risk Management
Representatives. Risks are then assessed by the Chief Risk
Officer prior to being reported to the Executive
Management Team.
The operational risk profile is reviewed monthly by the
Executive Management Team to ensure that any new or
emerging operational risks are identified and captured and
that any previously identified risks and mitigating actions
are monitored.
inSUranCe aCtivitieS
In conjunction with the Enterprise Risk Management
system, Sydney Ports maintains an annual Insurance
Program renewed on 30 June each year. Sydney Ports
utilises the services of its insurance broker for an annual
assessment of risk exposure and coverage levels and for
sourcing underwriters to renew policies.
The key policies within the insurance program provide
comprehensive coverage across all the Corporation’s
operations including Industrial Special Risks, Public
Liability, Marine Hull Commercial and Protection, Workers
Compensation, Trade Credit, and financial loss policies
such as Professional Indemnity.
board ComPoSition
Under the State Owned Corporations Act (NSW) 1989.
Sydney Ports Board is required to have a minimum of three
and a maximum of seven Directors. One of these Directors
is required to be a Staff Director, elected by the staff of
Sydney Ports. Directors are appointed by the Governor,
on the recommendation of the Voting Shareholders.
The Voting Shareholders appoint the Chairman, who is
currently Bryan T. Smith. Mr Smith is an independent
Director and his role is clearly separated from the role of
the Chief Executive Officer, Grant Gilfillan. Mr Smith is
currently on the board of one other organisation, which is
not a government board. The Chairman is responsible for
leading the Board and facilitating its effective functioning.
Sydney PortS CorPoration annUaL rePort 2011/12
Chief exeCUtive offiCer
The Chief Executive Officer, Grant Gilfillan, was appointed
in January 2008 and was re-appointed for a second term
in March 2011. As set out in the State Owned Corporations
Act (NSW) 1989, the Chief Executive Officer was appointed
by the Governor on the recommendation of the Portfolio
Minister, following a recommendation from the Board.
The Board’s recommendation of Mr Gilfillan came after an
extensive recruitment process.
The Chief Executive Officer is responsible for the day
to day management of the operation of Sydney Ports in
accordance with the general policies and specific
directions of the Board.
Mr Gilfillan was separately appointed as a Director of
the Sydney Ports Board in March 2009. His current term
of appointment as a Director will expire in January 2014.
board indePendenCe
All Directors are expected to exercise independent
judgment when making Board decisions. It is the approach
and attitude of each non-executive Director which is critical
to determining independence and this must be considered
in relation to each Director while taking into account all
other relevant factors, which will include an assessment
against the independence recommendations in the
guidelines which cover whether the Director:
■■ is employed, or has been employed in a senior
management position by the business, and there has
not been a period of at least three years between
ceasing that employment and serving on the Board
■■ has, within the last three years, been a principal of
a material professional adviser or consultant to the
business, or an employee materially associated with
the service provided
■■ is a material* supplier or customer of the business,
or an officer of or otherwise associated directly or
indirectly with a material supplier or customer
■■ has a material* contractual relationship with the
business other than as a Director of the business.
* Material means greater than five per cent of the Corporation’s gross
revenues.
The independence of each Director is reviewed on an
annual basis to ensure circumstances that may affect
the independent status of a Director have not changed.
Grant Gilfillan, as both a Director and the Chief Executive
Officer, is not considered independent. Michael Sullivan, as
the staff elected Director and an employee of Sydney Ports,
is also not considered independent. All other Directors are
considered independent.
aCCeSS to information and indePendent
ProfeSSionaL adviCe
Each Director has the right of access to all Sydney Ports’
information and employees. Further, the Board and each
individual Director, subject to informing the Chairman, has
the right to seek independent professional advice from a
suitably qualified advisor. Advice can be sought to assist
Directors in carrying out their responsibilities and is at
Sydney Ports’ expense. Where appropriate, a copy of this
advice is to be made available to all other members of
the Board.