Review of the Registered Clubs Industry in NSW - Clubs NSW

9 Improving corporate governance
establishment of good working relationships between boards and management, and
encourage directors to invest time and money in undertaking training. 170 To
encourage clubs to adopt this approach and assist them in overcoming member
resistance to it, IPART considers that ClubsNSW should develop a Best Practice
Guideline on this issue.
Recommendation
49 That ClubsNSW continue to develop its Code of Practice and Best Practice Guidelines as
new corporate governance issues arise. In particular, ClubsNSW should develop a Best
Practice Guideline encouraging boards to move to three-year rolling elections.
In addition, IPART considers that ClubsNSW could continue to develop its Code of
Practice and Best Practice Guidelines by:
introducing best practice recommendations into its Best Practice Guidelines
amending its Code of Practice to require a club to:
– either follow its Best Practice Recommendations or, if it does not follow a
recommendation, to explain why that recommendation was not appropriate to
the club’s particular circumstances
– set out in its annual report the extent to which it has followed each
recommendation and the reasons it has not followed any particular
recommendations.
This approach is based on one used by the Australian Securities Exchange (ASX),
known as the ‘if not, why not’ approach. The ASX has a suite of corporate
governance recommendations for listed companies to follow. If a listed company
considers that a particular recommendation is not appropriate to its circumstances, it
has the flexibility under the ‘if not, why not’ approach to not adopt the
recommendation, as long as it explains why. The ASX requires that listed companies
disclose in their annual reports the extent to which they have followed each
recommendation. 171
170 Leagues Club Association, Wagga Wagga roundtable, 14 September 2007, p 50; ClubsNSW
submission, 31 July 2007, p 158; RSL & Services Clubs Association submission, 9 April 2008, p 9;
Riverina Australian Rules Club, Wagga Wagga roundtable, 14 September 2007, p 52.
171 ASX Corporate Governance Council, Response to Submissions on Review of Corporate Governance
Principles and Recommendations, August 2007, p 2.
Review of the Registered Clubs Industry in NSW IPART 159