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Corporate Governance

ASC is a proprietary company limited by shares registered under the Corporations Act 2001 and is subject to the Public, Governance Performance and Accountability Act 2013.

All the shares issued in the capital of ASC are owned by the Minister for Finance. Refer to Figure 4 for Group Structure.

This is a flow chart depicting ASC's corporate structure. It shows at the top in a box the Minister for Finance, who has 100 percent ownership of ASC Pty Ltd, which is the next box down. Then there are four arrows point to the rest of the group structure, which includes 1. ASC AWD Shipbuilder, 2. ASC OPV Shipbuilder, 3. Deep Blue Tech and 4. ASC Modules. There is a note under the last two saying they are both dormant entities.

On 11 June 2004, ASC was proclaimed as a GBE under the then Commonwealth Authorities and Companies Act 1997. ASC remains a GBE pursuant to section 5(2)(a) of the Public Governance, Performance and Accountability Rule 2014. ASC is a Commonwealth company.

Directors

The Directors of ASC (except the Managing Director) are appointed by the Minister for Finance for a term. As at 30 June 2020, the Board was comprised as follows:

Bruce Carter

Photo of ASC Chairman Bruce Carter

Chairman

Appointed: 01/01/2010

To: 31/12/2021

Bruce is a long-serving Director and Chair of ASC, joining the board in 2010 and overseeing its successful transformation to a high performing submarine sustainment company following the Coles Review in 2012.

Bruce was appointed ASC Chair in October 2012 and reappointed to the role in 2018.

Bruce is currently a Director of Bank of Queensland Ltd, Aventus Property Ltd, SkyCity Entertainment Ltd and One Rail Australia.

He is a former partner of Ferrier Hodgson and Ernst and Young.

Dr Rosalind Dubs

Non-Executive Director

Photo of Board member Dr Rosalind Dubs

Appointed: 01/05/2013

To: 31/12/2022

Ros is currently a Director of Astronomy Australia Ltd, ANU Enterprise Pty Ltd and the Taronga Conservation Society and former Chair of the Space Industry Innovation Council.

Other former positions include: Director of Aristocrat Leisure Ltd, Director of Structural Monitoring Systems Plc, Deputy Vice-Chancellor University of Technology Sydney, Senior Executive roles with Thales SA in Germany, France and Australia and with Airservices Australia.

Paul Rizzo

Non-Executive Director

Photo of Non Executive Director Paul Rizzo

Appointed 13/12/2013

To: 12/12/2022


Paul has extensive experience as a Senior Executive, working for 50 years in general management, finance, telecommunications, banking and defence.

Paul wrote the Defence-commissioned Plan to Reform Support Ship Repair and Management Practices, or Rizzo Report, in 2011, which influenced the improvement of RAN engineering and warship maintenance arrangements.

He has also worked as a Chief Executive Officer, Director and Advisor.

Loretta Reynolds

Non-Executive Director

Photo of Non Executive Director Loretta Reynolds

Appointed: 09/02/2016

To: 08/02/2022

Loretta has extensive legal experience through her role as Chair and Corporate Partner of national corporate law firm Thomson Geer.

Offering more than 20 years’ experience in the legal sector, she specialises in projects, mergers and acquisitions and complex transactional work.

Loretta is currently a non-executive director of the Royal Flying Doctor Service Central Operations and Director of the Royal Flying Doctor Service Federation Board.

Joycelyn Morton

Non-Executive Director

Photo of Non Executive Director Joycelyn Morton

Appointed:01/01/2017

To: 31/12/2022

Joycelyn has an extensive business and accounting background and has held senior executive and board roles across several industries in the corporate and government sectors.

Joycelyn is currently a non-executive director of Snowy Hydro Limited, Argo Investments Limited, Argo Global Listed Infrastructure Limited and Beach Energy Limited.

In 2003 Joycelyn was awarded Life Membership to CPA Australia for her outstanding services to the profession.

Geoff Rohrsheim

Non-Executive Director

Photo of Non Executive Director Geoff Rohrsheim

Appointed: 15/03/2019

To: 14/03/2022

Geoff has successfully established several innovative businesses in the IT sector and has significant experience as a Company Director.

After completing his studies in engineering at the Australian Defence Force Academy, Geoff served in the Royal Australian Air Force as an Engineering Officer.

In 2017, Geoff was awarded the Pearcey Foundation’s SA Entrepreneur Award, for leadership in business and innovation.

Geoff is currently a non-executive director of Seeley International, the Australian Cyber Collaboration Centre and Hatch Creations. He is also a member of the Australia Post Stakeholder Council and the SA Premier’s Economic Advisory Council.

Stuart Whiley

Managing Director

Appointed: 12/02/2018

To :02/01/2021

Stuart was appointed Managing Director and Chief Executive Officer of ASC Pty Ltd in February 2018 after holding the position of Interim Chief Executive Officer from July 2014, following a career with the company that spans more than 30 years.

Stuart has significant experience within ASC, having spent years in various submarine programs, projects, schedule and systems engineering roles within the business. In 2005 he was appointed General Manager, CCSM, responsible for the Collins Class support activities in both SA and WA.

Prior to emigrating to Australia from the UK in 1988, Stuart held a number of engineering roles at BAE, Admiralty Research Establishment and Dowtys working in a Naval/Weapons environment.

Attendance

ASC Board and Committee Attendance 2019/20

Director Board Audit Committee Human Resources and Business Assurance and Remuneration Committee Security Committee

Held

Attended

Held

Attended

Held

Attended

Held

Attended

Bruce Carter

14

14

0

0

5

5

4

4

Dr Rosalind Dubs

14

14

0

0

0

0

4

4

Paul Rizzo

14

14

5

5

0

0

4

4

Loretta Reynolds

14

14

5

5

5

5

0

0

Joycelyn Morton

14

14

5

5

5

5

0

0

Gary Gray

14

7 *

0

0

0

0

4

3

Geoff Rohrsheim

14

14

0

0

0

0

4

4

Stuart Whiley

14

14

0

0

0

0

0

0

*Gary Gray resigned effective 11 March 2020 (attended 7 of 14 meetings before resigning).

Australian National Audit Office Reports

On 4 July 2019, The Australian National Audit Office (ANAO) released ‘Cyber Resilience of Government Business Enterprises and Corporate Commonwealth Entities’.

The report considered ASC’s Cyber Resilience and found that it had a fit for purpose cyber security risk management framework which met the requirements of its respective frameworks by implementing the specified information and communications technology (ICT) controls that support desktop computers, ICT servers and systems and has implemented controls in line with the requirements of the Information Security Manual, including the Top Four and other mitigation strategies in the Essential Eight with high levels of cyber resistance.

The ANAO also provided an Independent Auditor’s Report contained in ASC’s 2020 Annual Report.

Ministerial Directions

In accordance with its Constitution, ASC is subject to direction by its Minister. No directions were given to ASC by the Minister during the 2019/20 financial period.

Corporate Governance

ASC has adopted a corporate governance protocol which establishes:

  • Charters for the Board, Audit Committee, Human Resources and Remuneration Committee, and Business Assurance and Security Committee; and
  • A Code of Conduct.

The Board monitors performance against its corporate governance objectives at each Board meeting.

ASC Board Charter


Under the ASC Board Charter, theBoard is responsible for:

  • Overseeing the ASC Group, including control and accountability systems.
  • Appointing and monitoring the performance of the Managing Director and the Company Secretary and, where appropriate, the removal of the Managing Director and Company Secretary.
  • Approving other executive appointments, organisational changes and senior management remuneration policies and practices.
  • Monitoring and reviewing senior management’s performance and implementation of strategy, and ensuring appropriate resources are available.
  • Providing strategic advice to management.
  • Determining the strategy of the ASC Group and monitoring the performance of objectives.
  • Approving and monitoring the progress of major capital expenditure, capital management, acquisitions and divestitures, as well as financial and other reporting;
  • Approving budgets and other key performance indicators, and reviewing the Group’s performance against them and monitoring the implementation of corrective action.
  • Reviewing and ratifying systems of risk management, internal control and legal compliance to satisfy itself that appropriate compliance frameworks and controls are in place.
  • Reviewing and overseeing the implementation of ASC’s Code of Conduct for Directors and Executives;
  • Appointing Board committees and approving the composition, and any charters, of Board committees;
  • Monitoring and verifying compliance with legal and regulatory requirements, ethical standards and policies.

Exercising due diligence to ensure that ASC complies with its work, health and safety obligations including by taking reasonable steps to:

  • Acquire and keep up-to-date knowledge of work health and safety matters.
  • Gain an understanding of the nature of ASC’s operations and the hazards and risks within those operations.
  • Ensure appropriate resources are available and processes implemented to enable hazards to be identified and risks eliminated or minimised.
  • Ensure ASC has appropriate processes for receiving and considering information regarding incidents, hazards and risks, and responding in a timely way to that information.
  • Ensure the business implements processes for complying with work health and safety laws, regulations and codes of practice.
  • Verify the provision, and use, of the resources and processes referred to above.

Audit Committee

The objectives of the Audit Committee are to help the Board achieve its objectives in relation to:

  • Financial and performance reporting.
  • Risk oversight and management.
  • Annual budgeting and forward forecasts.
  • The application of accounting policies.
  • Internal control.
  • Maintaining and improving the quality, credibility and objectivity of the financial accountability process (including financial reporting on a consolidated basis);
  • Establish and oversee effective internal and external audit functions and communication between the Board and the external and internal auditors.
  • Verify financial compliance strategies and financial compliance function are effective.
  • Maintaining an effective external and internal audit function, in compliance with all applicable laws.

As at 30 June 2020, the Committee consisted of Joycelyn Morton (Chair), Paul Rizzo and Loretta Reynolds.

More information regarding the audit committee can be found at https://www.asc.com.au/about-us/corporate-governance/

Human Resources and Remuneration Committee

The objective of the Human Resources and Remuneration Committee Charter is to assist the Board to fulfil its corporate governance and oversight responsibilities in relation to the Company’s people strategy, including:

  • Remuneration components.
  • Performance measurements and accountability frameworks.
  • Recruitment and retention.
  • Talent management.
  • Succession planning.

As at 30 June 2020, the Committee consisted of Loretta Reynolds (Chair), Bruce Carter and Joycelyn Morton.

Business Assurance and Security Committee

The objectives of the Business Assurance and Security Committee (BASC) are to satisfy itself that:

  • Adequate systems are in place for the effective identification and assessment of all areas of potential material business risks other than those arising from financial reporting and accountability (being risks considered by the Audit Committee).
  • Adequate policies, processes and procedures have been designed and implemented to manage identified material risks.
  • Appropriate action is undertaken to bring the identified material risks within the Group’s risk tolerance levels.
  • A culture of compliance is being promoted.
  • Compliance strategies and functions are effective.

As at 30 June 2020, the Committee consisted of Paul Rizzo (Chair), Bruce Carter, Rosalind Dubs and Geoff Rohrsheim.

Transactions with other related Australian Government Entities

In performing its contracts, ASC has transacted on normal commercial terms and conditions with the following related entities.

Table 5 - Transactions with other related Australian Government Entities

Aggregate value $

Number of Transactions

ANAO

341,215

8

Comcare

200,735

3

DoD

16,162,947

31

Medicare

18,935

8

Australian Naval Infrastucture Pty Ltd

22,711,024

116

39,434,856

166

Board Membership

During the 2019/20 reporting period, Gary Gray AO resigned as a Non-Executive Director of ASC with effect 11 March 2020.

Code of Conduct

ASC has implemented a Code of Conduct for directors, employees and contractors which seeks to:

  • Articulate the high standards of honesty, integrity, ethical and law-abiding behaviour expected of directors and other ASC personnel.
  • Encourage the observance of those standards to protect and promote the interests the shareholder and other stakeholders.
  • Guide directors and ASC personnel as to the practices considered necessary to maintain confidence in the ASC Group’s integrity.

Auditor

ASC’s external auditor is the ANAO. PricewaterhouseCoopers has been appointed as ANAO’s agent for the purposes of ASC’s audit. The Audit Committee is charged with responsibility for internal financial audit. The Group Internal Audit Manager is responsible to the Audit Committee for contributing to the achievement of ASC’s goals and objectives by:

  • Assisting management in evaluating its processes for identifying, assessing and managing the key operational, financial and compliance risks of ASC.
  • Assisting management in evaluating the effectiveness of internal control systems, including compliance with internal policies.
  • Recommending improvements in efficiency to the internal control systems established by management.
  • Keeping abreast of new developments affecting ASC’s activities and in matters affecting internal audit work.
  • Being responsive to ASC’s changing needs, striving for continuous improvement and monitoring integrity in the performance of its activities.

Risk Management

ASC is committed to risk management as an integral part of its business. Both the Audit Committee (financial risk) and BASC (operational risk) are responsible for monitoring ASC’s risk management performance. ASC risk management involves:

  • Identifying corporate risk.
  • Assessing the likelihood of theiroccurrence.
  • Estimating the likely consequenceof risks should they occur.
  • Implementing strategies to avoid, mitigate or minimise the consequence of risk.

As part of this risk management emphasis, the Board instituted:

  • The implementation of an enterprise-wide Risk Management Framework.
  • An Executive Risk Management Committee.

Legal Compliance

ASC has established a Legal Compliance Program. In 2019/20, the program covered:

  • Defence exports;
  • Work health and safety;
  • Employment;
  • Environment;
  • Intellectual property;
  • Security;
  • Corporate governance; and
  • Controlled technology.

The BASC is responsible for approving and monitoring the program.