2004-05 Annual Report - Australia Post

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CORPORATE
GOVERNANCE
General
Australia Post has in place
a comprehensive system
of corporate governance
practices designed to provide
appropriate levels of disclosure
and accountability.
These practices derive
principally from the provisions
of the Australian Postal
Corporation (APC) Act 1989, the
Commonwealth Authorities and
Companies (CAC) Act 1997 and
the Governance Arrangements
for Commonwealth Government
Business Enterprises (1997).
They are also consistent with
the ASX Corporate Governance
Council’s best practice
recommendations, in so far
as they can be applied to a
government business enterprise
such as Post. A dedicated
corporate governance section
on the Australia Post website
(auspost.com.au) provides
a detailed description of the
corporation’s governance
framework and associated
practices, with hyperlinks to
key documents.
Shareholder ministers
The Minister for Communications,
Information Technology and
the Arts, Senator the Hon
Helen Coonan, has portfolio
responsibility for Australia
Post. Under a dual shareholder
model, overall responsibility
for the enterprise is exercised
jointly with Senator the Hon Nick
Minchin, Minister for Finance and
Administration.
The board
The board of Australia Post
comprises up to nine directors,
eight of whom serve in a nonexecutive
capacity. The managing
director is the sole executive
director. Non-executive directors
are appointed by the Governor-
General on the nomination of the
portfolio minister. Appointments
can be for up to five years and
reappointment is permissible.
Current practice is for terms of
appointment to be generally of
three years’ duration.
Before nominating a person for
appointment, the minister is
required to consider the balance
of expertise on the board and also
to consult with the chairman.
The managing director is
appointed by the board.
Board membership during
2004–05 was:
Linda Nicholls (Chairman)
David Mortimer (Deputy Chairman)
Graeme John (Managing Director)
Mark Birrell
Margaret Gibson
Peter McLaughlin
Sandra McPhee
Edward Tweddell
Ian Warner.
Profiles of each director and
details of their skills, experience
and expertise are provided on
p. 58–59.
Role of the board
The board is accountable
for Australia Post’s overall
performance and for ensuring
that the corporation performs its
functions in a manner consistent
with sound commercial practice.
Directors set the corporation’s key
objectives and strategies through
a rolling three-year corporate
plan, which is submitted annually
to shareholder ministers.
Progress against the plan is
reported quarterly. Ministers
and their departments are also
kept informed on an ongoing
basis about developments of
significance.
Board committees
Separate audit and human
resources committees assist
the board in the discharge
of its responsibilities.
Audit Committee
The Audit Committee provides a
forum for regular communication
between the board and the
corporation’s auditors, both
external and internal. Made
up entirely of non-executive
directors, its membership during
2004–05 was:
David Mortimer (Chairman)
Margaret Gibson
Sandra McPhee
Edward Tweddell.
The Audit Committee Charter,
which is reviewed annually by
the board, is accessible in the
corporate governance section
of the Australia Post website
(auspost.com.au). The committee
meets at least four times a
year, focussing in particular on
the areas of financial reporting,
risk management and internal
controls. Among other things, it
is responsible for reviewing:
° annual financial statements
before their consideration and
adoption by the board
° clarity and quality of the
corporation’s financial policies,
practices and disclosures
° internal and external
auditor plans, reports
and performance
° significant existing and
emerging risks and
mitigation activities
° the adequacy and effectiveness
of internal controls
° compliance with laws
and regulations
° related party transactions.
The external and internal auditors
attend all Audit Committee
meetings, as do the managing
director, chief finance officer
and group financial controller.
A key feature at the start of each
committee meeting is a private
session with the external auditors,
without management present.