MIRVAC gRoup AnnuAl RepoRt 2012 - Mirvac - Mirvac Group

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CoRpoRAte goVeRnAnCe stAteMent 5 pRinciple 4: sAfeguARD integRity in finAnciAl RepoRting / continueD The Managing Director, Chief Financial officer, Chief operating officer, Chief Risk officer as well as representatives of the external and internal auditors are able to attend ARCC meetings. The ARCC regularly meets with the external auditors without management present. Details of meeting attendance of members of the ARCC are contained in the following table: Number of ARCC meetings Number of ARCC meetings held whilst a member attended whilst a member Mirvac Director James Millar AM (Chair) 7 7 Peter hawkins 7 7 James MacKenzie 7 7 John Mulcahy 7 7 John Peters 2 2 elana Rubin non-Mirvac Directors 7 7 Paul Barker 7 7 Richard Turner 7 7 iv) ARCC responsibilities The ARCC Charter sets out the responsibilities of the ARCC. The ARCC responsibilities include the review of external financial accounting, internal control and risk management, external audit, internal audit, compliance, special investigations and managed investment schemes. v) Compliance The ARCC has direct responsibility for monitoring and reviewing the compliance plans of Mirvac’s registered managed investment schemes and wholly owned controlled entities holding Australian financial services (“AFS”) licences, as well as overseeing their adherence to all applicable laws and regulations. 6 pRinciple 5: MAKe tiMely AnD bAlAnceD DisclosuRe a) commitment to disclosure Mirvac is committed to ensuring: — compliance with ASX Listing Rules disclosure requirements; — accountability at a senior executive level for that compliance; — facilitation of an efficient and informed market in Mirvac securities by keeping the market appraised through ASX announcements of all material information; and — compliance with the requirements of the Corporations Act 2001, ASX Listing Rules and the Recommendations. b) continuous Disclosure policy The Group’s Continuous Disclosure Policy, which was updated during 2012, is designed to support its commitment to a fully informed market in its securities by ensuring that the Group announcements are: — made to the market (via the ASX Company Announcements platform) in a timely manner, are factual and contain all relevant material information; and — expressed in a clear and objective manner that allows investors to assess the impact of the information when making investment decisions. A copy of Mirvac’s Continuous Disclosure Policy is available at Mirvac’s website: www.mirvac.com/corporate-governance. 34 mirvac group annual report 2012 7 pRinciple 6: Respect the Rights of shAReholDeRs a) communications policy All Mirvac ASX announcements are posted to Mirvac’s website including half year and annual reports, results releases, market briefings, notices of meetings and the Mirvac property compendium. Teleconferencing and webcasting facilities are provided for market briefings to encourage participation from all stakeholders, regardless of location. Mirvac is committed to rotating the location of its AGM, to allow securityholders in locations other than Sydney to participate in person. The 2009 meetings were held in Sydney, the 2010 meetings were held in Brisbane and the 2011 meetings were held in Perth. The 2012 meetings will be held in Sydney. Mirvac encourages securityholders to attend the AGM. At those meetings, securityholders are entitled to ask questions about the management of Mirvac. Securityholders are provided with a reasonable opportunity to ask questions of the external auditor at the meetings. The external auditor is also allowed a reasonable opportunity to answer written questions submitted by securityholders to the meetings. The meetings are webcast each year, with access details posted to Mirvac’s website in advance of the date of the meetings. Notices of meeting for general meetings are accompanied by explanatory notes to provide securityholders with information to enable them to decide whether to attend the meeting. Full copies of notices of meetings and explanatory notes are posted on Mirvac’s website. Securityholders who are unable to attend the meeting may vote by appointing a proxy, using the form attached to the notice of meeting or an online facility. Securityholders are also invited to submit questions in advance of the meeting so that Mirvac can ensure those issues are addressed at the meeting. Mirvac’s Communications Policy is available at Mirvac’s website: www.mirvac.com/corporate-governance. 8 pRinciple 7: Recognise AnD MAnAge RisK a) Risk management policies i) Risks Mirvac is a leading ASX listed, integrated real estate group with activities involving real estate investment, residential and commercial development and investment management. These activities involve risks of varying types and to varying extents. Risk can relate to both threats to existing activities, as well as a failure to take advantage of opportunities that may arise. Mirvac’s objective is to ensure those risks are identified and appropriate measures are implemented to mitigate or otherwise manage the impact those risks may have on the Group’s activities.
8 pRinciple 7: Recognise AnD MAnAge RisK / continueD ii) Risk Management policy In recognition that risk management is a key element of an organisation’s effective corporate governance processes, the Board has adopted a Risk Management Policy statement and associated procedures for identifying, assessing and managing Mirvac’s strategic, operational, financial and reputational risks. The objectives of the Policy are to: — provide a systematic approach to risk management aligned to the Group’s strategic objectives; — define the mechanisms by which the Group determines its risk appetite and considers and manages risks; and — articulate the roles and accountabilities for the management, oversight and governance of risk. The approach defined within this Policy is consistent with the Australian and New Zealand standard on risk management (ISo 31000: 2010). The Policy applies to all legal entities within the Group to enable an enterprise-wide approach to managing risk to be applied. Supporting this Policy is a framework which has been prepared to guide the various business units in addressing their particular risk exposures through a structured implementation of risk management processes. Although structured, the framework maintains a sufficient degree of flexibility to allow the respective business units to adopt appropriate strategies to address their risk exposures, as risks and their management by designated controls are the responsibility of the business. A copy of the Mirvac Risk Policy is available at Mirvac’s website: www.mirvac.com/corporate-governance. iii) Risk management responsibility The Board determines the overall risk appetite for the Group and has approved the strategies, policies and practices to ensure that risks are identified and managed within the context of this risk appetite. The application of the Group’s policies and procedures to manage risk is ultimately the responsibility of the Board, which has in turn delegated specific authority to the ARCC (as more fully detailed in the ARCC Charter). The ARCC advises the Board on risk management and is responsible for reviewing policies for approval by the Board and for reviewing the effectiveness of the Group’s approach to risk management. Risk management is specifically reviewed at least quarterly by the ARCC. iv) Risk management function The Board has charged management with the responsibility for managing risk within the Group and the implementation of mitigation measures, under the direction of the Managing Director supported by senior executives. A Group risk management function, led by the Chief Risk officer, has been established to facilitate the process by providing a centralised role in advising the various business units on executing risk management and mitigation strategies, as well as consolidating risk reporting to the senior executives, the ARCC and ultimately the Board. Management has advised the Board of the effectiveness of the management of material business risks. mirvac group annual report 2012 v) Role of internal audit The Group’s risk management systems work along side its internal control systems to establish an effective control environment to manage business risks. Internal Audit’s role is to evaluate, assess and support continuous improvement of the Group’s internal control system and provide independent reasonable assurance to the ARCC and the Board that material risks are effectively managed. Internal Audit’s focus is on key risks and business drivers which may hinder the achievement of the Group’s business objectives. The Internal Audit function is led by the head of Internal Audit who reports to the Chair of the ARCC and has open access to the ARCC and its Chair at all times. vi) operational risks The Managing Director, supported by senior executives, is responsible for implementing and maintaining effective risk management and internal control systems for operational risks that arise from the Group’s activities. To ensure consistent and effective practices are employed, each business unit has developed risk registers, detailing the key risks facing the particular business unit. vii) financial risks The Board has approved principles and policies to manage financial risks arising from the Group’s operations, including its financing and treasury management activities. The ARCC reports to the Board in relation to the integrity of the Group’s financial reporting, internal control structure, risk management systems as well as the internal and external audit functions. Mirvac management also provides assurance to the Board and the ARCC as to the effectiveness of the Group’s risk management and internal control systems in relation to financial reporting risks. The ARCC also oversees, and reports to various Boards within the Group on, the specific risks and compliance requirements arising from the activities of the Group’s AFS licensed entities and respective registered managed investment schemes. b) external auditor relationship i) Role of ARCC Mirvac’s ARCC is responsible for overseeing the relationship with the Group’s external auditor, PricewaterhouseCoopers, including the terms of engagement of the external auditor and the scope of the external audit program each year. The ARCC is also responsible for monitoring and evaluating the performance, and independence, of the external auditor and the provision of non-audit services. ii) Auditor independence It is the Group’s policy to rotate audit engagement partners on listed companies at least every five years, and in accordance with that policy a new audit engagement partner was introduced for the year ended 30 June 2011. To maintain auditor independence, the Board has adopted a policy and practice protocol related to non-audit services which forms part of the ARCC Charter published on Mirvac’s website. It is the Group’s policy to engage the best available professional advisers at the most competitive price. This policy must, however, be applied within the context of maintaining the independence of the Group’s external auditors. The ARCC policy endorses the fundamental principles of auditor independence that, in order to be eligible to undertake any non-audit related services, the external auditor must not, as a result of that assignment: — create a mutual or conflicting interest with that of the Group; — audit their own work; — act in a management capacity or as an employee; or — act as an advocate for the Group. The policy also details the services that the external auditor is prohibited from performing. 35
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MIRVAC gRoup AnnuAl RepoRt 2012 - Mirvac - Mirvac Group

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