CORPORATE GOVERNANCE CHARTER

AusSchol is an incorporated association, registered in New South Wales. The operations and management of AusSchol Inc. are overseen by a Council elected by members (“Members”) of the Association. The Australian Scholarships Foundation (ASF) is the Deductible Gift Recipient Fund of AusSchol Inc. and is the primary operating entity. ASF is controlled by a Board appointed by the Council of AusSchol Inc.

AusSchol and ASF are bound by the same Corporate Governance Charter, which is endorsed by the Members.

For convenience, the Council of AusSchol and the Board of ASF are referred to in this Charter, jointly, as the “Board”, and as ASF is the operating arm of AusSchol, the entity is referred to as “ASF” or “the organisation”. Members of the Council of AusSchol Inc and members of the Board of the Australian Scholarships Foundation are herein referred to as “Directors”.

The Board recognises its role in overseeing the determination of, and implementation of, processes which reflect good corporate governance. It continues to refine and improve the governance framework and practices in place to ensure they meet the interests of stakeholders including Directors, Members of the Association, donors and funding bodies (including local, State and Federal Governments), education providers, employees, volunteers, scholars, supporters and the community at large.

Although ASF is not a listed entity it supports the Australian Securities Exchange Principles of Good Corporate Governance and Best Practice Recommendations and applies them insofar as it is sensible and realistic to do so in the context of a not-for-profit (“NFP”) organisation. 

A description of ASF’s main corporate governance principles is set out below.

1.  LAY SOLID FOUNDATIONS FOR MANAGEMENT AND OVERSIGHT

Role of the AusSchol Council and ASF Board (the "Board")

The Board operates in accordance with the Constitution and Board Charter. The Constitution and the Charter detail the roles and responsibilities of the Board as well as its membership and operation. 

The Board:

• provides the overall strategic guidance for ASF
• provides effective oversight of management
• is responsible for the corporate governance of the organisation
• guides and monitors the business affairs of ASF
• ensures that ASF’s activities comply with its Constitution. 
  

The Board is responsible to Members for the performance of the organisation in both the short and longer term.

Responsibilities of the Board

The responsibilities of the Board include:

-    Strategy and Planning

• Overseeing the management of the organisation and direction of its business strategy
• Providing strategic direction for, and approving, the organisation’s business strategies and objectives

-    Oversight of Management

• Appointing and, where appropriate, removing the Chief Executive Officer (CEO), reviewing any other key executive appointments and planning for executive succession
• Overseeing and evaluating the performance of the CEO
• Reviewing and approving remuneration policies and practices

-    Financial and Capital Management

• Reviewing and approving the organisation’s annual financial reports
• Monitoring the operational and financial position and performance of the organisation
• Establishing procedures to ensure that financial results are appropriately and accurately reported on a timely basis in accordance with legal and regulatory requirements

-    Business Plans

• Approving the organisation’s budgets and business plans and monitoring the management of the organisation’s capital and resources

-    Stakeholders

• Ensuring that reporting mechanisms are put in place by the CEO that result in effective communication with stakeholders

-    Compliance, Risk Management, Ethics and Sustainability   

• Overseeing the identification of the principle risks faced by the organisation and taking reasonable steps designed to ensure that appropriate internal controls and monitoring systems are in place to manage the impact of these risks.
• Reviewing and approving the organisation’s internal compliance procedures including the Code of Conduct and taking reasonable steps to ensure that the business of the organisation is conducted in an open and ethical manner
• Establishing and maintaining appropriate governance structures, including evaluating the performance of Directors and determining the size and composition of the Board
• Overseeing processes to ensure compliance with laws and policies.

As part of the oversight of management, the Board has established a process of annual performance review and goal planning.

CEO and Delegation to Management

Day to day management of the organisation’s affairs and the implementation of the corporate strategy and policy initiatives are delegated to the CEO.

2.  STRUCTURE THE BOARD TO ADD VALUE

Board Composition

The Board is comprised entirely of independent non-executive Directors. The Board seeks to ensure that it has a Board with an appropriate range of skills, experience, expertise and members (Directors) who have an understanding and competence to deal with the current and emerging issues in the organisation’s activities. The organisation’s succession plans are designed to maintain that appropriate balance of skills, experience and expertise on the Board.

Directors’ independence

To ensure their independence and absence of conflicts of interest, the Board’s practice is that Directors may not be current employees of the organisation.

Board Members

Details of the members of the Board (the Directors), including their experience and expertise, are included on ASF’s website. 

The Chairman and CEO

The Chairman is responsible for the leadership and effective performance of the Board.  The Chairman is independent of the role of the CEO of the organisation.

Term of Office

The organisation’s Constitution specifies that one third of the Directors and any Director who has held office for 3 years or more since last being elected at an annual general meeting must retire from office.  Retiring directors may stand for re-election.

Induction

An induction is provided to educate new Directors about the operation of the Board and its committees, and financial, strategic, operations and risk management issues, the corporate strategy and the expectations of performance of Directors.

Independent Professional Advice

Following consultation and approval by the Chairman, Directors are entitled to seek independent professional advice at the Company's expense. Any such advice provided to individual Directors must be shared with the Chairman and the Board.

Review of Board Performance

The Board has processes in place to regularly review its composition and annually evaluates its collective and individual directors' performance and development needs. The reviews cover a range of issues including the Board's performance, processes and interaction with management and individual directors' specific contribution to the ongoing performance and strategic direction of the organisation. External advisors and systems are used where appropriate.

Board Meeting and Board Committees

The Board meets at a frequency that allows it to discharge its duties effectively. The CEO participates in Board meetings. Agenda setting is a collaborative process that is coordinated by ASF’s Secretary, guided by a formal calendar of activities, with input from the Board Chairman and the CEO, and with final approval by the Board Chairman.

The Board has established an Executive Committee to assist in the execution of its responsibilities. This Committee is established to improve Board effectiveness and efficiency where activities require more concentrated effort and specialist skills and are an efficient use of Board resources.

The Board does not delegate major decisions to this committee but charges the  committee with the responsibility to consider detailed issues and to make appropriate recommendations to the Board.

The Committee operates principally in a review or advisory capacity. It has a charter describing its role and processes and these are regularly reviewed by the ASF Board. All matters determined by committee are submitted to the full Board as recommendations for Board decisions.

Membership of the committee is based on Directors’ qualifications, skills and experience. 

Any Director is entitled to attend any meeting of the Executive or other committees of the Board. All committees keep minutes of all discussions and those minutes are tabled at the subsequent Board meeting.

From time to time the Board may also establish ad hoc committees to assist with specific issues or projects, including assessment of scholarships applications.

Nominations and Remuneration Committee

The Board as a whole, given the small size of the organisation’s activities:

• reviews and approves policies on Board composition, strategic function and size;
• considers suitable persons as directors of the Association;
• reviews annually the CEO's performance and remuneration;

Advisory Panel

To keep ASF’s scholarships strategy contemporary and relevant, and to help identify trends and influences in the Australian NFP sector, ASF has appointed a small group of people to its Advisory Panel. No fees are paid for serving as a member of the Advisory Panel.

3.  PROMOTE ETHICAL AND RESPONSIBLE DECISION MAKING

Code of Conduct

The Board expects ASF as a whole, every Director, officer employee, contractor, consultant, volunteer or associate (collectively “employees”) to conduct themselves with the highest ethical standards. ASF has developed a Code of Conduct (the Code) which outlines ASF’s expectations and enables employees to share a common understanding of how to conduct themselves in a manner that upholds and maintains ASF’s values.

4.  SAFEGUARD INTEGRITY IN FINANCIAL REPORTING

The Board as a whole, given the small size of the organisation’s activities:

• Reviews ASF’s financial statements and other financial information distributed externally;
• Assesses the appropriateness of accounting policies, practices and disclosures;
• Reviews the internal control framework, the risk management framework, the activities of the auditor and the adequacy of risk management practices;
• Monitors procedures designed to ensure compliance with statutory and external reporting responsibilities;
• Reviews financial aspects of projects and capital expenditures
• Liaises with the external auditor
• Assesses the independence of the external auditor.

In fulfilling its responsibilities, the Board:

• Receives regular reports from management and the external auditors;
• Regularly meets with the external auditors;
• Reviews the processes the CEO has in place to support certifications to the Board;
• Reviews any significant disagreements between the auditors and management irrespective of whether they have been resolved;
• Meets separately with the external auditors at least annually without the presence of management; and
• Provides the external auditors with a clear line of direct communication at any time to the Chairman of the Board.
• The Board has an appropriate number of Directors with formal qualifications to assist it to discharge the technical aspects of its responsibilities.

External Auditors

The organisation appoints external auditors who clearly demonstrate quality and independence. The performance of the external auditors is reviewed annually.

5.  STAKEHOLDER COMMUNICATIONS

The organisation is committed to continually improving the mechanisms by which it gathers information and reports to its stakeholders on progress towards delivering on its commitments and use of the resources entrusted to it. The organisation prepares and makes available a variety of reports, each aimed at providing the information necessary to improve accountability and transparency.

6.  RECOGNISE AND MANAGE RISK

The organisation understands and recognises that rigorous risk management is essential to achieve its strategic objectives. The organisation has implemented a Risk Management Framework that incorporates the principles of effective risk management.  Together with sound risk management practices, this framework helps ASF not only mitigate threats to meeting its objectives, but also to take advantage of opportunities.

The Board is responsible for considering and approving the risk management framework and monitoring management’s compliance with it. 
Management is responsible for designing, implementing, reviewing and providing assurance as to the effectiveness of the Risk Management Framework. Risk assessments are conducted and risks are identified for analysis treatment and/or monitoring. 

7.  REMUNERATE FAIRLY AND RESPONSIBLY

The Board as a whole considers remuneration and incentive policies and practices for the organisation’s management.

It has also developed a remuneration policy designed to strike a balance between retaining motivated, skilled and experienced staff with the organisation’s NFP status and its reliance on donated funds.

No fees are paid for serving as a Director of the organisation. Reasonable expenses incurred by Directors in fulfilling their duties (such as travel and accommodation expenses required to attend Board meetings) may be met by the organisation. 

Revised November 2012