The Registered Organisations Commission (ROC) is the independent regulator of 106 federally registered employer and employee organisations. Our functions include promoting the efficient management of organisations, and high standards of accountability of organisations and their office holders, as set out in the Fair Work (Registered Organisations) Act 2009 (RO Act).
There are 61 employer associations and 45 unions which, including those entities, are comprised of 354 reporting units across Australia. They report to the ROC that cumulatively they have more than two million members, control almost $3.2 billion in assets and collect annual revenue in the order of $1.7 billion.
A key objective of the ROC is to encourage behaviours in registered organisations that see them consistently focused on acting in the best interests of their members, ensuring members’ money is spent in a way that is transparent, properly authorised and which complies with their obligations under the RO Act.
When the Registered Organisations Commission commenced two years ago, a key aim was to increase compliance with the financial reporting requirements in the RO Act by focusing on building structures, approaches and resources within the ROC to help drive positive compliance cultures in registered organisations. It was our assessment that the majority of registered organisations and their office holders wanted to achieve high levels of compliance and, in order to add value, the ROC could assist them by delivering a range of measures including focusing on education, face-to-face workshops, providing guidance notes, templates, fact sheets, expansive toolkits, an array of web-based resources and the personal engagement of my staff.
I am pleased to report that contributed to by the efforts of our dedicated team, the quality of compliance within financial reports has increased from 56% in 2015 (prior to the establishment of the ROC when financial reports were lodged with the Fair Work Commission) to 84% in the current reporting period of 2018. In 2015–16, 96% of financial reports due were lodged in accordance with statutory timeframe obligations, while that has increased in 2018–19 to 99%. The percentage of annual returns of information lodged within the statutory timeframe has remained at 100% in 2019, again contributed to by continued regulatory intervention and focus.
The qualitative improvement in financial reporting can also be attributed in part to the implementation and management by the ROC of an auditor registration scheme which coincided with the commencement of the ROC in 2017. The RO Act requires all financial reports of organisations and branches be audited by an auditor registered by the ROC before they are provided to members. Regulatory engagement, information workshops and the proactive tools we have provided to the 290 auditors we have registered since May 2017 have helped to improve financial consistency and compliance in organisations by assisting them to meet statutory requirements, including the reporting guidelines I issue.
A further important measure to promote general and specific compliance with the financial reporting and accountability requirements of the RO Act has included our conduct of a range of civil penalty proceedings in the Federal Court. At the same time, we have been challenged in the Federal Court and have been required to devote very significant resources in defending our jurisdiction, with the Australian Workers’ Union (AWU) commencing proceedings seeking to prevent the ROC from investigating potential breaches of civil penalty provisions which may have occurred prior to 1 May 2017. The ROC is currently awaiting the outcome of that Federal Court challenge to our jurisdiction.
The general trajectory of enhanced compliance has been achieved while the ROC has simultaneously met all of its key performance indicators (KPIs). This has happened against a backdrop of significant competing work priorities and challenges.
For example, during the 2018–19 financial year we successfully implemented a new case management system (CMS). This was a significant project requiring the deployment of significant resources. For an organisation of 29 staff, this was a substantial commitment as these resources have come from operational staff who were concurrently delivering on the ROC’s other priorities. The new CMS equips us to better and more quickly meet the extensive and ongoing needs of registered organisations. I thank my staff for their contribution to this project while sustaining the ROC’s performance across its other functions.
Further and in the reporting period, ROC staff delivered successful education campaigns, including face-to-face workshops in Sydney, Melbourne, Darwin, Perth and Brisbane. A total of 233 office holders and representatives of our stakeholders attended our 2018–19 workshops. This means that in the past two years more than 400 people, representing 76 registered organisations, have attended a ROC workshop, which is almost three-quarters of the registered organisations we interact with. Feedback from these sessions is overwhelmingly positive with 97% of workshop participants responding to ROC surveys indicating they would benefit from and attend future ROC workshops.
In addition, throughout this period we have continued to work with registered organisations as part of our expansive whistleblower work to equip them to achieve, if they decide to, an internal ‘speak-up’ culture.
During 2018–19, we also further progressed 19 referrals from the Royal Commission into Trade Union Governance and Corruption (TURC) by undertaking investigations and continuing proceedings in the Federal Court. Two other referrals were finalised.
In 2018–19, organisations and their branches were for the first time required by the RO Act to lodge officer and related party disclosure statements with the ROC. We provided detailed fact sheets, guidance notes and webinars; facilitated expert panel discussions at our information workshops; and delivered one-on-one consultations about these new regulatory requirements. In the result, 92% of organisations and branches lodged their statements within the statutory timelines.
The year ahead
Now in our third year, the ROC is embedded in its regulatory role. We remain focused on fulfilling our functions and we are committed to adding value to organisations and fostering good governance and financial transparency, as well as compliance with the RO Act, by:
continuing to encourage and support organisations to improve financial reporting and statutory compliance
expanding our education campaign and engagement with registered auditors to drive enhanced compliance
helping organisations to further embed a culture of compliance and increase core organisational skills and capabilities to achieve it
promoting high standards of accountability to members
implementing the 2019–20 national ROC Education Strategy, which schedules our key education activities in the year ahead
delivering further interactive information workshops tailored to the feedback we continue to receive
encouraging democratic control by enabling accountability of office holders to their members through arranging for elections and publishing annual returns of information in a timely manner
continuing to engage with registered auditors and work with organisations to ensure their disclosures meet statutory requirements
progressing the audit of governance training by officers of organisations
building our reporting capability through our new CMS
replenishing and updating our educational materials
continuing our work in educating about whistleblowers and receiving, assessing, investigating and where necessary further acting on disclosures
continuing to monitor the acts and practices of organisations in complying with the provisions of the RO Act
undertaking inquiries and investigations into suspected contraventions of the RO Act while working collaboratively with organisations to remediate harm and promote effective governance; and
taking appropriate and proportionate evidence-based enforcement action designed to achieve both specific and general deterrence.
The ROC has continued to deliver on its functions throughout 2018–19. Notwithstanding that we are a compact Commission, we have delivered significant outputs towards achieving our statutory objectives and outcomes. We look forward to achieving more in 2019–20.