Push for four-year fixed federal parliamentary terms

The Australian Institute of Company Directors (AICD) has called on major political parties to commit to a 2017 referendum for four-year fixed terms of Federal Parliament, as part of their election campaigns.

It’s concerning that voters will soon be at the ballot box less than three years since the last election. And on average, the last 15 Federal Parliaments have run for terms of just two and a half years.

In addition to writing directly to major party leaders, John Brogden FAICD, managing director and CEO at the AICD, had an opinion piece published in the Sydney Morning Herald , and we received additional coverage across major media outlets.

We have recently shone a light on short-termism in governance and the impact of this on Australia’s Federal Parliament is clear. Policies are often discarded quickly, either before they are implemented or too soon after implementation for their impact to be properly assessed. We cite the recent tax debate – or lack thereof – as an example.

Australian states and territory parliaments have moved to four-year terms, and most have also adopted a fixed term. Fixed election cycles are also common globally; the UK recently moved from variable to fixed five-year terms. France and Indonesia also have five-year terms, while the US and German governments serve four-year terms.

Australia’s governance frameworks are in urgent need of modernisation.


Board diversity events and research initiatives

AICD and Chief Executive Women (CEW) are hosting a series of national networking and diversity events throughout May and June in Melbourne, Brisbane, Sydney and Perth. With hosts Elizabeth Proust AO FAICD, Diane Smith-Gander FAICD and Meredith Hellicar MAICD, the events will provide an opportunity for leading ASX directors to connect with established and emerging female directors. Participants will discuss the AICD and CEW joint research initiatives and partnership, promoting the importance of diversity on boards and within organisations more broadly.

AICD and CEW are working to produce best practice gender reporting guidelines for board chairs, committee chairs and non-executive directors, and have formed an advisory group of influential male and female chairs and non-executive directors to guide the process. Boston Consulting Group will also provide support to the advisory group. The guidelines will help boards to demand gender reporting from the CEO and executive team, with a view to ensuring increased management focus, enhanced reporting capability and accountability for the achievement of diversity targets. This resource will complement existing work already undertaken.


QLD Environmental Protection Act

In late April, the Queensland Parliament introduced the Environmental Protection (Chain of Responsibility) Amendment Act 2016 (the Act). The new Act was introduced in the wake of the highly publicised Queensland Nickel situation, using it as an example to compel responsible persons connected to the company in financial distress to meet environmental responsibilities. The Act however, extends well beyond those specific sites. Any person or entity with a connection to a company that carries on environmentally relevant activities in Queensland, should consider the risks of liability posed by the Act.

While the AICD respects the intentions of the Act in seeking to maintain accountability for damaging environmental practices, we’ve identified and raised a number of clear concerns with the legislation and provided these through our submission to the parliamentary inquiry on the bill, and in correspondence to ministers’ offices.


2016 Not-for-profit governance study

The not-for-profit (NFP) team were on the road during May conducting focus groups with members to inform the development of the 2016 NFP Governance and Performance Study . These focus groups provide an opportunity to explore in detail the major governance issues affecting the sector.

The study, now in its seventh year, is the largest study of its kind in Australia, and examines the governance practices, opportunities and challenges that face the Australian NFP sector.

Focus groups have been held with members in Perth, Brisbane, the Sunshine Coast, Toowoomba, Darwin, and Sydney.

This year’s study will include a more detailed focus on issues of financial sustainability, examining some of the causes that underline financial instability in the sector and exploring the ways that directors are responding to this challenge. The study will also profile the health sector, investigating the unique trends and challenges that NFPs face within it.

Find out more http://www.companydirectors.com.au/nfp