Under the PGPA Act, FSANZ is a corporate Commonwealth entity. Our governance framework contributes to strong and sustainable performance and builds confidence in our capacity to respond to challenges.
The Board is the accountable authority for FSANZ, and as such, must govern the entity in a way
- the proper use and management of public resources
- the achievement of the purposes of the entity
- the sustainability of the entity.
The Board recognises the importance of applying sound governance principles and practices. It has adopted a Board Charter to ensure that both FSANZ and the Board meet its objectives. The Charter sets out the Board’s objectives, authority, composition and tenure, reporting and administrative arrangements. The Charter also sets out the Board’s roles and responsibilities.
The FSANZ Board is established under Section 116 of the FSANZ Act.
The Board comprises 11 part-time members drawn from Australia and New Zealand, plus the full-time Chief Executive Officer who is an ex-officio member. Areas of expertise of Board members covers public health, food science, food safety, food allergy, human nutrition, medical science, veterinary science, microbiology, biotechnology, consumer policy, food processing or retailing, primary food production, small business, international trade, food regulation and government.
The Australian members are appointed by the Australian Minister for Health, in consultation with the Australia and New Zealand Ministerial Forum on Food Regulation (the Forum), following consultation with the Australian states and territory and New Zealand Governments, and consideration by the Cabinet. The New Zealand members are nominated by the New Zealand Government and appointed by the Australian Minister for Health.
On appointment, Board members receive a formal induction on the organisation and their duties. In pursuit of their duties, Board members may seek independent legal, financial or other advice after seeking guidance from the Board Chair, and have access to FSANZ senior management and staff.
Details of Board members, including their qualifications and terms of appointment, can be found in APPENDIX TWO: Board expertise and experience.
During 2019–20 four face-to-face Board meetings and four Board teleconferences were held. Outcomes of FSANZ Board meetings are published on our website. Due to the COVID-19 pandemic the FSANZ Board adjusted quickly to the new routine of virtual Board meetings. There was a strong focus from the Board on the health and wellbeing of our staff during this time of heightened stress and anxiety.
The Board Charter includes a requirement that a formal review of the performance of the Board be undertaken every two years. Reviews are conducted using a mix of external evaluation and facilitated self-assessment with appropriate input sought from all parties including the Board, the CEO, the internal and external auditors, management and any other relevant stakeholders, as determined by the Board.
In September 2019 the Board undertook an informal internal evaluation process. The findings of the review are being implemented.
Under Section 18 of FSANZ Act the Board may establish committees as it thinks fit to assist it in carrying out its functions. During 2019–20 two ongoing committees assisted the Board to effectively exercise its functions:
- Finance, Audit and Risk Management Committee
- People, Culture and Remuneration Committee
Finance, Audit and Risk Management Committee (FARMC)
The FARMC supports the Board’s oversight responsibilities relating to FSANZ’s risk, control and compliance frameworks, financial statements, and performance reporting responsibilities.
During 2019–20, the FARMC continued to monitor the corporate governance and risk management activities of the organisation, advising the Board on FSANZ’s appetite for risk in relation to strategic, operational and fraud control matters. The committee regularly monitors the identification and management of risks to FSANZ, providing assurance that reasonable steps have been taken to address the risks by reducing the likelihood they (and their consequences) will occur.
The FARMC is chaired by Professor Martin Cole and is composed of three FSANZ Board members and one independent member. Observers to FARMC meetings include representatives from the Australian National Audit Office and the Board Chair and FSANZ CEO.
People, Culture and Remuneration Committee (PCRC)
The PCRC assists the Board in fulfilling its governance responsibilities in relation to the people, culture and remuneration functions of FSANZ. The PCRC considers and provides advice to the Board on issues such as remuneration and performance standards for the CEO, as well as Board remuneration (which is determined by the Remuneration Tribunal).
The Committee is chaired by the Board Chair and is composed of three members, with the FSANZ CEO an ex-officio member.
Compliance and Assurance
The FARMC oversaw the 2019–20 Internal Audit Program, which was undertaken by an outsourced provider. The program focused on providing assurance that we have in place key business processes, associated risks and related assurance activities, and providing real-time advice on the fitness for purpose of FSANZ’s ICT strategy.
FSANZ is committed to strategically and systematically managing risks. The FSANZ Board governs FSANZ and is responsible for establishing and maintaining appropriate enterprise risk management and internal control systems. The Board, acting through the CEO, has established a system of risk management that identifies enterprise risks, assesses those risks, monitors and manages them.
In the period covered by this report, the FSANZ Risk Management Framework (the Framework) provided the foundation for monitoring, reviewing and continually improving risk management with FSANZ.
The Framework was reviewed during the period to ensure it adhered with the international standard on risk management AS/NZ/ISO 31000:2018, the Commonwealth Government’s Risk Management Policy, and was consistent with the requirements of the PGPA Act.
The Board also reviewed its Risk Appetite Statement to ensure our tolerance for risk in each of a whole range of activities undertaken was still fit for purpose. The risk appetite statement is dynamic and is reviewed on a regular basis in conjunction with FSANZ’s planning cycle.
In 2019, we participated in Comcover’s annual risk management benchmarking survey. This annual practice provides us with an opportunity to review and benchmark our risk related practices and processes against those of comparable agencies.
FSANZ has a fraud risk assessment and a fraud control plan that complies with the Commonwealth fraud control guidelines. The plan includes fraud prevention, detection, investigation, reporting and data collection procedures. There were no cases of fraud reported or identified during 2019–20.
Under the Comcover Statement of Cover, FSANZ maintained professional indemnity insurance coverage for our directors (Board members) and officers of $100 million.