Acting for You, September 2019

Minutes Statement

Governance Institute and the Australian Institute of Company Directors have collaborated on a joint statement to outline current issues in minute taking to support our members and guide debate on this topic. 

The practice of minute taking has attracted heightened scrutiny in recent months. The statement summarises the key principles, provides our view on matters to be included in minutes, and considers the approach to board papers and document retention policies.

We obtained feedback from our members and also sought counsels’ opinion on some particular issues related to minutes to add legal context to the conclusions, recommendations and positions taken in the statement, which apply to both board minutes and board committee minutes.

 The legal opinion from Dominique Hogan-Doran SC and Douglas Gration covers:

  • the purpose of minutes and detail to be included
  • drafts and notes
  • amendments to minutes
  • challenge and dissent
  • board papers and other supporting documents
  • legal professional privilege.

The link to the statement is here

The statement summarises the key principles, provides our view on matters to be included in minutes, and considers the approach to board papers and document retention policies

#fixfundraising

Governance Institute has continued its advocacy efforts on NFP fundraising reform with a meeting with the office of the Assistant Minister for Finance, Charities and Electoral Matters, Senator the Hon Zed Seselja.

At that meeting we repeated the call for clarification and improvement of how fundraising is covered by the Australian Consumer Law. The #fixfundraising coalition (of which we are a member) has advocated for some years about the need to improve the piecemeal system of state-based regulation for NFP fundraising and reduce the level of red tape to allow the sector to focus its resources on serving the community. The coalition already has advice that the Australian Consumer Law (ACL) currently applies to regulate most ordinary NFP fundraising activities.

We believe there is a real opportunity for the Commonwealth to direct future efforts to fix NFP fundraising by tailoring the ACL, a regime that is already enforced by the states, territories and the ACCC, rather than attempting to streamline piecemeal state legislation.

The world is changing rapidly. NFP’s of all types are moving to digital fundraising, making existing state laws in many cases out of date. The ACL, its related legislation and multi-regulator framework provide an immediate opportunity to vastly improve the regulatory environment for fundraising activities with no need for a referral of powers.

The ACCC has already issued guidance confirming that fundraising activity involving a supply of goods or services or fundraising in an organised, continuous and repetitive way is likely to be trade or commerce and there are likely to be certain obligations under the ACL. Members of the #fixfundraising coalition have also clarified with national and state regulators that the application of the ACL to NFP fundraising does not mean that state-based enforcement would no longer be conducted. The ACL is already a multi-regulator model — the staff who currently work in the state consumer affairs departments and administer the relevant state charitable fundraising acts, who are currently occupied in reviewing licence applications etc, could be more effectively redeployed to administer the application of the ACL to NFP fundraising activities in their various states.

We hope that the first appointment of an Assistant Minister for Charities will be the catalyst for finally achieving fundraising reform. 

Governance Institute will keep our members updated on developments.

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Whistleblowing

I recently represented Governance Institute at the Annual Whistleblower Forum in Brisbane at which Griffith University and partners released a five step guide to better whistleblowing policy and practice in business and government. The guide was a result of the key findings from the Whistling While they Work 2 research project. Governance Institute is a supporter of this research.

The full report can be downloaded here

The research project is one of the world’s largest studies into whistleblowing, and the first large-scale project to focus on management of whistleblowing across business and government.

The guide works as a companion to new whistleblower provisions in the Corporations Act 2001 which came into effect on 1 July 2019 that create a single, strengthened whistleblower protection regime for Australia’s corporate sector. Under the new provisions, public companies, large proprietary companies and proprietary companies that are trustees of registrable superannuation entities are required to have a whistleblower policy and make it available to their officers and employees by 1 January 2020.

ASIC has released draft guidance to help entities establish and implement a compliant whistleblower policy and has called for comments on its proposed regulatory guide. 

Governance Institute is developing a submission in response to ASIC’s consultation paper on the guidance and will keep members updated on this important topic.

Modern slavery

Commencing on 1 January 2019, the Modern Slavery Act introduced a modern slavery reporting requirement for large entities carrying on business in Australia. Governance Institute attended a conference held by the Department of Home Affairs on Implementing Australia’s Modern Slavery Act on 26 and 27 June 2019. The conference was the first of its kind in Australia and was held to raise awareness about the obligations under the Modern Slavery Act and strengthen discussion between business, civil society and governments to work together to tackle modern slavery. 

As advised in the June edition of Acting for You, Governance Institute lodged a submission to the Department of Home Affairs on draft guidance for those required to report under the Act. The final form of the guidance is expected to be released shortly. 

For companies with a 30 June financial year, the first reporting year will be 1 July 2019–30 June 2020 with the reports due by 31 December 2020. Other entities may have to report earlier, depending upon the timing of their end of financial year. For example, entities with a 31 March 2020 end of financial year will need to report by 30 September 2020. The reports will be published on a public register.

Governance Institute will continue to update members on this issue.

AI

Governance Institute has been developing submissions on the topic of artificial intelligence.

We lodged a submission to the Strategic Policy Division of the Department of Industry, Innovation and Science in response to a Discussion Paper on Artificial Intelligence and Australia’s ethics framework in June 2019.

In July 2019 we commented on the Discussion Paper Developing Standards for Artificial Intelligence: Hearing Australia’s Voice issued by Standards Australia.

In our submission, Governance Institute argued that to be a leader in AI initiatives globally, we would need:

  • free, ubiquitous, fast internet connectivity
  • incentives for business to adopt AI technology
  • an appropriately skilled workforce
  • significant investment by government in developing AI technology, and
  • regulation to ensure responsible and ethical AI.

Governance Institute considers that standards are an important aspect of ensuring the effective implementation of AI in Australia. Organisations in all sectors could use compliance with standards to signal they have appropriate practices in place regarding the development and use of AI to potential users, customers and other stakeholders. Standards also provide a framework for organisations considering adopting AI technologies to use a best-practice approach to minimise costs and risks. 

We also highlighted that there are some aspects of AI where legislation may be needed to avoid or prevent significant misuse of AI.

We consider that issues of AI and ethics will become increasingly important and we will continue to keep members updated on this developing area of policy.

Submissions

Developing Standards for Artificial Intelligence: Hearing Australia’s Voice — 31 July 2019 

Media Releases

Royal Commission fallout will define the governance professional’s role through to 2025 — 20 August 2019

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