In August 2004, the Government published its response to the Uhrig review of the corporate governance of statutory authorities and office holders. More recently, the Australian Wheat Board (AWB) inquiry has again thrown the issue of public sector governance into the spotlight. Against that background, and other governance initiatives, Chartered Secretaries Australia (CSA) would like to see how your department, agency or government-owned corporation is dealing with issues of governance reform.

1. What best describes the pace of governance reform in your organisation?

Rapid — we have seen genuine change so far 45%
Steady — we are getting there incrementally 35%
Slow — progress is happening but not quickly 15%
There has been no change at all because of a lack of time/commitment
These reforms are not relevant to my organisation 5%

Comments

Becoming a GOC and moving in true commercial circles has forced the corporation to put in place a Corp Gov program (including risk management and compliance) consistent with the Australian Standards.

2. Have governance reforms affected the structure of your organisation?

Yes, significantly 20%
Yes, to some extent 30%
Yes, but minimally 35%
No 15%

Comments

We now have dedicated sections and resources for Risk Management, Compliance and Legal. At one time they were all combined under a Legal and Compliance Manager. Resources have increased from 2 staff to 8.

3. Have governance reforms affected the day-to-day running of your organisation?

Yes, significantly 25%
Yes, to some extent 35%
Yes, but minimally 30%
No 10%

Comments

Processes and practices now ensure appropriate consideration of governance issues in decision making including appropriate risk assessments.

4. Do you feel the changes have been a positive step overall?

Yes, very positive 50%
Yes, somewhat positive 40%
Neutral 10%
No

Comments

Board, shareholders, regulators and other external stakeholders have all taken great comfort in the quality in business processes and decision making that the enhanced governance regime has brought.

5. Do you think there is an expectation that private sector governance frameworks should be applied to the public sector, regardless of fit?

Yes 35%
No 65%

Please comment

Some of the framework just doesn't fit so it really can't be applied.
I think there is recognition that there are some benefits in private sector models, but that a blanket transplanting is not the best way to go - public sector IS different.
Different capital and strucural setups, not to mention culture.
The Private Sector tends to have focus on shareholder expectations and value. Government has many more stakeholders whose interests must be addressed in any governance framework. This is coupled with the difference of Government Boards and their relationship with the CEOs of Government departments and statutory departments.
Generally speaking I think there is recognition of differing objectives and goals that often apply in the public sector.
It forces the organisation to become much smarter and allows the understanding of accountability and the value of proactive good corporate governance to be far more easily embraced . Basically ensures people have the tools and support to think and act far more in accordance with 'real world' thinking and expectations.
No, not if audience understands role of government.
This myth that private sector business arrangements including governance can be overlaid like a template continues to be perpetuated.
This expectation fails to recognise fundamental differences between the private and public sectors, particularly for public sector bodies that do not deal directly with consumers and which are funded totally by the government.
No, many of our statutory authorities only have the budget/possible expenditure allowed through appropriations so their opportunity for Governance oversight and strategic creativity & innovation does not run the risks of "going broke" etc. Their P S nature and their particular political and community stakeholder context is too complex and variable to allow the "one size fits all" approach.
The Private sector could learn from the public sector with respect to governance not the other way.
Yes, for a GOC no doubt.
Need to be adapted to fit public sector (eg remuneration requirements not applicable).
It is essential to consider fit in the public sector as there is already a lot of regulation to adhere to and additional regulation just for regulation’s sake is not likely to be effective.
No, private sector issues whatever they are should never be imposed wholesale on the government sector.

6. Does your organisation have a clear charter or memorandum of understanding (MOU) outlining the relationship between the board/agency head and the minister/parliament?

Yes 55%
No 20%
Don't know 15%
Not applicable 10%

Comments

No, but legislation states the reporting obligation.
Yes, most do, but some authorities which are mature, doing ongoing and non-controversial work, don't necessarily have close oversight by the Ministers. Ministers tend to be active with their oversight of those authorities that are implementing reform programs and working in controversial issues.
No, Local Government - therefore General Manager reports to Council. Different structure. Local Government Act defines relationship between Council and Minister. Code of Conduct and Policy on Interaction Between Councillors and Staff further defines relationship between Council and General Manager.

7. Is the MOU or charter referred to by the agency head or board in dealings with the Ministerial office?

Yes 40%
No 5%
Sometimes 10%
Don't know 20%
Not applicable 30%

Comments

We know it is sometimes referred to. We wouldn't always know about the agencies’ interactions with the Minister’s office - only when the Minister ask us to be present or if they ask for a 2nd opinion about docs provided by the authorities.
Often — roles wrt to certain approvals are set out in the GOC legislation and gov GOC guidelines.

8. What has been the impact on your organisation of the current structure of accountability between the board/agency head and the Minister?

Please comment

Sometimes confused
Normal everyday business
Don’t know
Lines of communication between Minister and CEO/Board are solid.
Far better understanding of goals and expectations and deliverables whilst significantly reducing the 'hands on ' management by the Minister and his staff. Basically gives the Board and Exec clear goals and targets and allows them to get on with delivering them.
No issues.
Has not changed for some time.
Tighter governance.
No change.
Compliance with national priorities to gain additional funding.
We are an independent regulatory body, with almost no direction from the Minister/Dept in undertaking our functions.
The Ministers have asked the Dept to play an active role in generally assisting them to achieve their accountabilities for the sound oversight of the portfolio authorities, and from time to time will ask us to play an active part on attempting to resolve particular issues or entrenched positions.
The 1993 Local Government Act clarified quite clearly the relationship. The biggest impact has been upon the elected members of Council.
Roles quite clear, so little conflict there however the shareholders (gov) risk profile is not always aligned with a commercial GOC and that is where potential conflict can arise.
N/A for local government — accountability defined in the Local Government Act.

9. Has the AWB issue acted as a catalyst for reviews of accountability processes within your organisation?

Yes 5%
No 95%

If yes, please elaborate.
Have reviewed conflict, disclosure, dealing with offers of gifts procedures.
No, we have had a healthy respect for governance issues long before they became ‘popular’.
No, we were already articulating how important "an ethical culture"/"soft" governance was rather than focussing on the documentation/"hard" governance.
No, our reforms were initiated long ago and not of the nature re AWB.

10. What type of public sector organisation do you work in?

Government department 15%
Government agency
Government-owned corporation 30%
Statutory authority 35%
Local government 15%

11. What jurisdiction do you operate within?

NSW 25%
VIC 25%
QLD 15%
SA
WA 10%
TAS 10%
Federal 15%