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Corporate governance

 

Our governance structure includes the Regulator Board, our senior executive and the committees that provide strategic direction, leadership and oversight of our operations and support our agency to deliver our purpose of accelerating carbon abatement for Australia.

Members of the Regulator Board

Members of the Regulator Board are appointed by the responsible minister under the Clean Energy Regulator Act 2011, and are required to have substantial experience or knowledge and significant standing in relevant fields. The Chair holds office on a full-time basis. All other Members hold office on a part-time basis.

The Regulator Board determines our strategic direction and policies, and is accountable for our regulatory decisions according to the legislation we administer. In addition to their collective responsibilities, Members of the Regulator Board each apply their expertise to a specific area of focus. This adds depth to the Regulator Board’s appreciation of the operating environment and enables agency officers to draw directly on Members’ knowledge and experience. Members provide an update on their area of focus at each Regulator Board meeting.

The Regulator Board Members for 2018–19 were:

  • Mr David Parker AM (Chair)
  • Ms Virginia Malley
  • Ms Anne T Brown
  • Mr Michael D’Ascenzo AO, and
  • Dr Peter Davis.

Mr David Parker AM, Chair of the Regulator Board

 

Image of Mr David Parker AM, Chair of the Clean Energy Regulator

 

The Minister appointed Mr Parker as Chair of the Clean Energy Regulator on 3 July 2017.

Mr Parker has extensive experience in economics and public administration with a long professional involvement in policy and regulatory matters in a range of areas.

Prior to joining the agency, Mr Parker was Deputy Secretary at the Department of Agriculture and Water Resources. Mr Parker was responsible for the Australian Bureau of Agricultural and Resource Economics and Sciences, as well as the Department’s Water, Export, Trade and Market Access divisions.

Mr Parker has been Deputy Secretary at the Department of the Environment and Energy, with responsibility for water, Antarctica and national parks, and elements of climate change policy.

Previously, Mr Parker spent 25 years at Treasury, where he worked on financial sector liberalisation, tax reform, macroeconomic forecasting and policy, competition policy, energy policy and international economic issues. He was appointed Deputy Secretary in 2004.

From 1997 to 2002 Mr Parker worked at the Organisation for Economic Cooperation and Development in Paris. Mr Parker has qualifications in economics and law and was made a Member of the Order of Australia in 2012.

Ms Anne T Brown, Member

Area of focus: Audit committee and risk framework

 

Image of Ms Anne Brown, Member of the Regulator Board

 

Ms Brown has substantial knowledge and practical experience of Australian and international exchange traded financial markets, risk management, related infrastructure and regulatory environments.

Ms Brown is the Chair of the Life Code Compliance Committee, which monitors and oversees compliance with the Australian life insurance industry’s Code of Practice, a member of the Finance, Audit and Risk Committee of Monte Sant’ Angelo Mercy College Ltd and a member of the Australian Securities and Investments Commission’s Markets Disciplinary Panel.

Ms Brown was previously Chief Risk Officer with ASX Limited from 2006 to 2010, following its merger with SFE Corporation Limited (SFE). Her role included group executive responsibilities for enterprise-wide risk management, compliance and audit. She chaired a number of broader group executive committees and developed integration strategy, risk management and policy development and execution for ASX’s two central counterparty clearing houses.

Ms Brown represented ASX from 2008 to 2010 as the Chair and executive committee member of CCP12, an influential global industry association involving all major international clearing houses. Prior to the ASX–SFE, Ms Brown was a general manager with SFE, and previously worked with KPMG in both Edinburgh and Sydney.

Ms Brown holds a double major degree in accountancy and computer science from Heriot-Watt University, Edinburgh. She is a member of the Institute of Chartered Accountants of Scotland and a graduate member of the Australian Institute of Company Directors.

Mr Michael D’Ascenzo AO, Member

Area of focus: Cross-agency compliance and membership of the Joint Agency Executive Steering Committee

 

Image of Mr Michael D'Ascenzo AO, Member of the Regulator Board

 

Mr D’Ascenzo is recognised internationally for his leadership and expertise in administration, strategy and governance, and for his technical and design skills in tax law and superannuation.

Mr D’Ascenzo is an adjunct professor of the University of New South Wales. He also consults internationally on the modernisation of organisations, especially those working on tax policy or administration.

Mr D’Ascenzo’s previous roles include Commissioner of Taxation for seven years (2006–2012), and more recently as a member of the Foreign Investment Review Board (2013–2017), and as a non-executive director of Australia Post (2013–2016).

Mr D’Ascenzo holds degrees in economics and law from the Australian National University. He is also a graduate of the Harvard Business School Program for Management Development, the Australian Institute of Company Directors, and the University of Cambridge Programme for Sustainability Leadership. He is a member of the Institute of Chartered Accountants Australia, Fellow of the Australian Institute of Company Directors, Fellow of the Australian Risk Policy Institute, Honorary Life Fellow of CPA Australia and Honorary Fellow of the Association of Taxation and Management Accountants.

In 2010, Mr D’Ascenzo was appointed an Officer of the Order of Australia for service to public administration, particularly through reform and innovative engagement with the taxation profession and government agencies. In 2012, he was named the Institute of Chartered Accountants’ Federal Government Leader of the Year.

Ms Virginia Malley, Member

Area of focus: Market development and participant education

 

Image of Ms Virginia Malley, Member of the Regulator Board

 

Ms Malley has more than 30 years’ experience in the investment and banking sectors, including 17 years’ experience as a company director. Her areas of expertise are regulatory compliance, financial and environmental markets, risk management, corporate governance, custody and trusteeship.

Ms Malley is the Deputy Chair of the Biodiversity Conservation Trust of New South Wales, and a non-executive director of Perpetual Superannuation Limited, Perpetual Equity Investment Company Ltd and Morphic Ethical Equities Fund Ltd.

Ms Malley was previously the Chief Risk Officer at Macquarie Funds Management Group and was a member of a number of committees at Macquarie with focuses on clean technology, the Asia Pacific, private equity and global advisory investment. She also served on the boards of Macquarie Investment Management Limited and Bond Street Custodians Limited and was a member-elected trustee of the Macquarie Bank Staff Superannuation Fund. She oversaw the risk management of portfolios, worth more than $85 billion, investing in clean technologies, publicly traded debt securities, listed equities, derivatives, currencies and private equity. She also managed industry regulator and ratings agency relationships.

Ms Malley is a graduate of the Australian Institute of Company Directors. She holds a Bachelor of Arts and a Master of Applied Finance from Macquarie University, a Graduate Diploma in Environmental Law and a Master of Laws from the University of Sydney, and a Juris Doctor from the University of Technology, Sydney.

Dr Peter Davis, Member

Area of focus: Renewable energy

 

 

Dr Davis has extensive experience in the Australian energy sector, including 19 years at Chief Executive and General Manager level. He has extensive experience in regulatory and structural reform of critical infrastructure services in both regulated and competitive markets, with particular expertise in renewable energy, energy efficiency and demand side management.

Dr Davis is an independent non-executive Director of the Australian Energy Market Operator (AEMO), and is Chair of AEMO’s Technical and Regulatory Committee and a Member of the Zema Scholarship Trust Fund. He is a Member of the University of Tasmania’s Built Environment and Infrastructure Committee. From 2004 to 2014 he was Chief Executive Officer and Managing Director of Aurora Energy Pty Ltd, an energy utility with interests in electricity distribution, generation, retail and gas supply. He was a Director of the Energy Supply Association of Australia from 2008 to 2014, and chaired the Energy Supply Association of Australia’s Greenhouse Policy Committee.

Dr Davis holds a Doctor of Philosophy from the Solar Energy Research Centre at the University of Queensland, a Master of Business Administration from Deakin University, an honours degree in science from Monash University and degrees in science and education from the University of Tasmania. He is a Fellow of the Australian Institute of Company Directors and Engineers Australia.

Regulator Board meetings

Under the Clean Energy Regulator Act 2011, the Chair of the Regulator may convene a meeting at any time. Between 1 July 2018 and 30 June 2019, the Regulator Board met 10 times. See Cross-reference and apologies.

Agency senior executive staff

As at 30 June 2019 our agency senior executive comprised our Chair, three Executive General Managers and General Counsel.

 

Figure 10: Our agency structure as at 30 June 2019Organisational chart of the Clean Energy Regulator, headed up by David Parker, Chair and the Regulator Board comprising Anne Brown, Michael D'Ascenzo, Virginia Malley; Peter Davis. There are three divisions and eight branches.

 

Mr David Parker, Chair

Mr Parker was appointed by the Minister as the Chair from 3 July 2017 (see Page 77). Our agency executive staff report to the Chair, who is the head of our agency and the ‘accountable authority’ as defined by the Public Governance, Performance and Accountability Act 2013.

Mr Geoff Purvis-Smith, General Counsel

Mr Purvis-Smith joined the agency as General Counsel in June 2012.

Mr Purvis-Smith has extensive experience as a regulatory lawyer, having worked in a number of Commonwealth agencies including the Australian Customs and Border Protection Service, the Australian Competition and Consumer Commission and the Australian Communications and Media Authority. Before joining the Australian Public Service, Mr Purvis-Smith was a private sector lawyer specialising in litigation, regulation and government.

Mr Purvis-Smith holds degrees in arts and law and a master’s degree in international law.

Ms Shayleen Thompson, Executive General Manager
Scheme Operations Division

Ms Thompson joined the agency on 16 July 2018. She has extensive experience in international and domestic climate change policy with both the Commonwealth and state governments.

Prior to joining the agency, Ms Thompson led policy development work on the Carbon Farming Initiative and the Emissions Reduction Fund before taking on the role of Acting CEO of the Climate Change Authority. In that role, Ms Thompson led work on the Authority's review of the Emissions Reduction Fund and Australia's policies and goals to meet its emissions reduction commitments under the Paris Agreement.

Previously, Ms Thompson served as a lead negotiator on land issues for the Kyoto Protocol and has worked on the National Greenhouse Gas Inventory, the National Greenhouse and Energy Reporting scheme and the Renewable Energy Target.

Mr Mark Williamson, Executive General Manager
Scheme Support Division

Mr Williamson joined the agency in August 2012, following an extensive career including senior executive roles in the private sector and state and local government.

He previously held a national commercial and technical senior executive role in an ASX 200 company and was Executive Director at the Queensland Environmental Protection Agency, leading its regulatory operations across a diverse range of environmental legislation.

Mr Williamson has qualifications in applied science and post-graduate management qualifications.

Mr Steven Stolk, A/g Executive General Manager
Agency Support Division

Mr Stolk joined the agency in January 2018, following a decade of executive level positions in various government agencies, including the Civil Aviation Safety Authority and Sport Australia. He has strong experience as a change agent focusing on organisational and capability development.

Before joining the Commonwealth in 2008, Mr Stolk gained more than 18 years of experience in the private sector, including leadership roles in information management, IT strategy, agile methodology, business solutions, professional services, and project portfolio management.

Mr Stolk holds a bachelor degree in computing.

Governance framework and processes

Our corporate governance framework assists staff to plan and manage activities and deliver on the expectations of government and the community. The framework articulates the lines of authority, accountability, direction and control within our agency. It is designed to ensure our staff understand their accountabilities and our agency delivers outcomes in a controlled, transparent and accountable manner, in line with relevant legislation and government policy.

Our governance processes and policies include risk management, protective security management, business planning, financial management, performance and conformance monitoring and reporting, staff performance agreements, internal auditing, fraud prevention, and Chief Executive Directions and Instructions.

Our governance framework supports our agency culture—which promotes and upholds the Australian Public Service Values and Code of Conduct—and enables us to monitor and improve our performance.

Committee structure

Our governance committee structure:

  • ensures the Regulator Board and Chair meet their obligations, lead the agency and monitor the performance and conformance of the agency as a whole, and
  • facilitates our relationship with the Department of the Environment and Energy as a statutory authority within the Environment and Energy portfolio.

 

Figure 11: Our committee structure as at 30 June 2019This figure shows the various internal and external committees that govern the Clean Energy Regulator.

* Sub-committees that provide INPUT to Business Leadership Team and are directly accountable to the Accountable Authority.
** Sub-comittees that deliver OUTPUTS on behalf of Business Leadership Team.

Strategic Leadership Team

The Strategic Leadership Team is responsible for our agency’s executive functions including strategic leadership and management (in relation to the role of the Accountable Authority under the Public Governance, Performance and Accountability Act 2013 and Head of Agency under the Public Service Act 1999). Specifically, this team leads the culture of our agency, sets performance expectations and is responsible for our agency conforming to our obligations. Membership consists of the Chair, the Executive General Managers and the General Counsel. The Strategic Leadership Team is chaired by the Chair of the Regulator Board and generally meets weekly.

Business Leadership Team

The Business Leadership Team is responsible for decisions about implementing our agreed annual and business plans, manages matters that require collaboration across divisions, and monitors resolution of identified issues and implementation of our strategic priorities. This team comprises all General Managers, the General Counsel and Managers who report directly to an Executive General Manager, and generally meets fortnightly.

Audit Committee

The Audit Committee provides independent advice and assurance to the Chair of the Regulator Board on the appropriateness of our financial reporting, performance reporting, system of risk oversight and management. The Audit Committee comprises three members, including an independent committee Chair and at least one other external member, with a Member of the Regulator attending as an observer. It meets at least quarterly, and may hold special meetings to review annual financial statements and performance statements or to meet other specific committee responsibilities.

Joint Agency Executive Steering Committee

The Joint Agency Executive Steering Committee provides an inter-agency forum for high level strategic oversight of the schemes we administer, considers the implications of significant developments on policy and regulatory functions, and considers options for managing emerging trends, issues and risks within the policy and regulatory environment. This committee comprises the Chair of the Regulator Board, a Regulator Board Member, and Senior Executive Service employees from both the Department of the Environment and Energy and our agency. It meets three times a year or as otherwise agreed.

Emissions Reduction Fund Program Steering Committee

The Emissions Reduction Fund Program Steering Committee provides an inter-agency forum for problem-solving in regards to Emissions Reduction Fund policy, legislation, methods, and stakeholder management. This steering committee provides governance for management of scheme risks and benefits and is accountable to the Joint Agency Executive Steering Committee. It comprises Senior Executive Service employees from both the Department of the Environment and Energy and our agency, and generally meets quarterly or as otherwise agreed.

System Owners Reference Group

The System Owners Reference Group is a decision-making committee focusing on prioritising improvements to the business systems and data services that support and enable the capabilities in our agency operating model. This group is accountable to the Strategic Leadership Team, comprises the Chief Operations Officer (committee Chair), the Chief Data Officer, the Chief Information Officer, the Chief Financial Officer and relevant capability owners. It generally meets monthly.

Compliance Management Committee

The Compliance Management Committee is a forum to foster and drive a ‘firm but fair’ scheme compliance culture, champion approaches and settings to non-compliance that are consistent, coherent, predictable and measurable, and drive our agency’s transition to a better practice regulator. This committee comprises the General Manager Compliance Branch (committee Chair) and the General Managers responsible for administering our agency’s schemes. It generally meets monthly.

For part of the reporting year, our agency also had a Litigation and Enforcement Committee to discuss individual cases of non-compliance by scheme participants. The Litigation and Enforcement Committee operated as a sub-committee of the Business Leadership Team.

Security Management Committee

The Security Management Committee oversees and coordinates the strategic direction of our protective security and information security policies and practices and ensures we comply with relevant government requirements. It comprises the Agency Security Executive (committee Chair), the Chief Information Security Officer, the Chief Information Officer, the General Manager Human Resources, Security and Facilities. This committee generally meets quarterly.

Staff Consultative Committee

The Staff Consultative Committee provides a forum for consultation on general employment and workplace relations matters. It comprises the General Manager Human Resources, Security and Facilities (committee Chair) and employee representatives from each branch, two management representatives, a graduate representative, a union delegate (agency employee) and an external representative from the Community and Public Sector Union. This committee generally meets quarterly or as otherwise agreed.

Work Health and Safety Consultative Committee

The Work Health and Safety Consultative Committee encourages and facilitates staff participation in instigating, developing and carrying out measures designed to ensure our workers’ health and safety at work. It also considers workers’ health and safety matters raised by managers, health and safety representatives or other staff. It comprises the General Manager Human Resources, Security and Facilities (committee Chair), agency health and safety representatives, manager representatives, worker representatives and an external representative from the Community and Public Sector Union. This committee is required to meet at least quarterly.

Remuneration Committee

The Remuneration Committee makes recommendations to the agency head, or their delegate, regarding applications from employees for individual flexibility arrangements to vary remuneration-related conditions of the Clean Energy Regulator Enterprise Agreement. This committee comprises the Chief Operations Officer (committee Chair), the General Manager Human Resources, Security and Facilities, the Chief Financial Officer, the General Counsel and two General Managers. It meets as required.

Planning and reporting

Our business planning considers the allocation of human resources, investment, risk management and performance measurement and incorporates our agency’s performance reporting framework.

The Corporate Plan 2018–22 was our agency’s primary strategic planning document for the reporting year. It set out our purpose, objectives and strategic approach. This informed our broader planning framework, including all operational business plans, which articulate the objectives for the year ahead, how we will achieve these objectives, resources we will allocate to particular deliverables, associated risks we need to manage, and the contribution of individuals to meet the objectives.

Updated and published annually, our corporate plan explains the strategies we use to achieve our objectives and provides a framework for us to measure our performance, in accordance with paragraph 35(1)(a) of the Public Governance, Performance and Accountability Act 2013.

During 2018–19, we further developed our strategic planning by implementing our environmental scanning framework to better capture and address emerging threats and opportunities.

Our key performance indicators are designed to measure achievements against our purpose. They are part of our agency’s key performance indicator framework. This framework meets our external and internal reporting requirements, while ensuring the flexibility to incorporate changes in government policy.

We report our performance against the key performance indicators outlined in our corporate plan and the performance criteria in our Portfolio Budget Statement in Part 2: Annual performance statement from page 17, as required under section 39 of the Public Governance, Performance and Accountability Act 2013.

Risk management

Our approach to risk takes into account the legislative framework, Australian Government policy, our available resources and our operating environment. Our risk appetite and strategic risks reflect the nature of the schemes we administer.

In administering legislation on behalf of the Australian Government, we understand what might undermine our ability to achieve our objectives and meet our statutory obligations. Identifying and managing risks to these objectives at the strategic and operational level enables us to:

  • streamline regulatory processes across and within the schemes we administer
  • target resources towards areas of highest risk
  • achieve organisational efficiencies, and
  • deliver the specific objectives of relevant legislation effectively and efficiently.

Our Risk Management Policy and Framework outlines our agency’s risk management approach and is consistent with the Commonwealth Risk Management Policy. We continue to embed and enhance our risk management framework into day-to-day operations, adopting a strong risk management culture where all staff understand how their daily work fits into our agency’s capability to mitigate risk across our full range of functions.

In 2019, we participated in the annual Comcover Risk Management Benchmarking Survey, which measured our agency’s risk management capability against a maturity model. We maintained an overall maturity level of ‘Advanced’, demonstrating our ongoing commitment to embedding and improving strong risk management practices.

Fraud prevention and control

Our agency’s Fraud Control Plan provides assurance that we are managing our agency’s identified fraud risks appropriately. The plan meets our agency’s responsibility for compliance with section 10 of the Public Governance and Accountability Rule 2014 and the Commonwealth Fraud Control Framework.

Under the Fraud Control Plan, we take a comprehensive approach to fraud risk and ensure all reasonable measures are in place to prevent, detect and deal with fraud.

Our agency uses a range of strategies to prevent, detect and respond to fraud, including:

  • fraud control planning, monitoring and reporting
  • internal and external reporting mechanisms
  • collecting and analysing information and data to detect fraud
  • receiving and analysing allegations from internal and external sources
  • testing and analysing the effectiveness of fraud controls and, if necessary, making recommendations to strengthen controls to prevent and detect fraudulent activity
  • investigating fraud, misconduct and unethical conduct and applying the appropriate criminal, civil, administrative or disciplinary action, and
  • conducting investigations in accordance with the Australian Government Investigation Standards.

We support fraud prevention by ensuring agency staff undertake mandatory fraud prevention training and by promoting messages about:

  • how the agency identifies and reports suspected fraud
  • staff responsibilities, and
  • current and emerging risks.

Conflict of interest

We inform our staff about their obligations under the Public Service Act 1999, which requires staff to avoid actual, perceived or potential conflicts of interests. Staff and Regulator Board Members are required to complete an annual declaration of interest form. Compliance with this requirement is reported to the Audit Committee.

Business continuity management

Our business continuity management framework is designed to prepare for, and respond to, a business interruption or outage. Through our training and annual testing program, we assess our preparedness for a business disruption event. The lessons learnt from these exercises allow us to incorporate necessary improvements to continually build our resilience to a business disruption.

We have three operational frameworks—emergency management, incident management and business continuity—which we can deploy to deal with different aspects of an incident. We test the frameworks and linkages annually.

Internal audit

The Internal Auditor is responsible for the efficient and effective operation of our internal audit function, reporting to the Chair through the Chief Operations Officer and the Audit Committee.

During 2018–19 the Audit Committee held quarterly regular meetings and a special meeting to discuss our agency’s financial statements. It also reviewed our agency’s financial and performance reporting, risk oversight systems and management, and internal controls.

Our agency’s internal audit service provider is KPMG. In 2018–19 internal audits were completed into:

  • performance reporting
  • effectiveness of Safeguard Mechanism compliance controls
  • data strategy and governance
  • ICT Program Model (Phase 2a)
  • management of ICT contracts, and
  • information management/compliance with Protective Security Policy Framework and the Privacy Act 1988.

Regulatory reform

The Australian Government’s regulatory reform agenda aims to reduce unnecessary or inefficient regulation imposed on individuals, business and community organisations.

As part of the everyday administration of our schemes, we assess the potential burden on participants and implement practical, flexible regulatory approaches that appropriately balance both regulatory and participant needs.

We are required to report annually against the Commonwealth’s Regulator Performance Framework key performance indicators. In 2018–19 we prepared our third self-assessment report, looking at our activities and outputs for 2017–18.

The yearly reports, available on our website, demonstrate achievements against each of our specific measures under the Regulator Performance Framework. They reflect our commitment to good regulatory practice and maturity as a regulator.

We continually look to refine our practices and procedures, ensuring an appropriate balance between compliance and regulatory burden, and engage with participants to enhance outcomes under the schemes we administer. This has been confirmed each year by positive feedback received from our stakeholders and strong participation in our schemes.

Partnerships

We work closely with our regulatory partners to share information to ensure the integrity of the schemes we administer. We also provide information to assist other Commonwealth, state and territory government organisations to discharge their responsibilities under their respective legislation.

A range of formal agreements, lawful disclosure arrangements and staff secondments underpin our partnerships with other agencies. These mechanisms facilitate cooperation and information exchange to assist each agency to fulfil its regulatory responsibilities. This includes sharing relevant information, gathering intelligence and referring matters to the appropriate body, such as Commonwealth, state and territory agencies, including law enforcement if necessary.

Communications survey

We survey stakeholders and scheme participants to better understand their perception of our agency’s overall performance, our staff performance, regulatory burden and their preferred communication channels.

Table 12: Key survey findings

 

2014–15
% agree or strongly agree

2015–16
% agree or strongly agree

2016–17
% agree or strongly agree

2017–18

% agree or strongly agree*

2018–19
% agree or strongly agree

The agency is doing a good job

80

84

81

72

79

Respondent organisation has an effective working relationship with the agency staff

84

84

79

74

84

The agency performs functions effectively

82

82

80

70

76

The agency effectively engages with respondents

76

76

76

64

70

The agency has a clear direction and purpose

72

75

76

72

73

The agency has a sound focus on important issues

68

70

70

60

64

*In 2017–18 a pulse survey was performed on a slightly different basis to the full surveys in other years. The pulse survey covered similar questions, so we can compare results.

 

Overall, satisfaction increased in 2018–19. Findings highlighted:

  • Strong overall performance —Most respondents (79 per cent) surveyed agree that we are doing a good job, and 84 per cent believe they have an effective working relationship with us.
  • Areas to sustain — We want to maintain strong results for having clear direction and purpose, and agency performance.
  • Areas to improve — We will continue to work on improving effective relationships with participants, and performing our functions as effectively as possible.