Corporate governance

Page Index

• Corporate goals and values
• The Executive
• The senior leadership team
• Management committees
• Corporate governance initiatives
• Internal audit and fraud control
• Ethical standards

Leadership in my eyes involves a commitment to effective delivery, a bias for action, a spirit of collegiality and a capacity to motivate. It is about the quality of informed support that is given to the elected government of the day. It involves integrity of behaviour. Good governance depends in large measure upon those in positional authority being aware of the stewardship that is required of them.

Peter Shergold at the launch of Foundations of Governance in the Australian Public Service, Canberra, 1 June 2005

Corporate goals and values

As stated in the Overviews chapter of this report, the department shares a mission with the other agencies in the Prime Minister’s portfolio:

to achieve well-coordinated, efficient and accountable public administration, supported by a values-based Australian Public Service.

The department’s corporate goals, derived from that mission, are to provide:

• quality advice and information on those matters requiring the Prime Minister’s attention as the head of government and the Chairman of Cabinet
• efficient and coordinated government administration
• effective administration of the programmes for which the Prime Minister has responsibility.

In support of those primary goals, the department promotes a corporate ethos which values the contribution of staff and the cost-effective and professional management of our people and resources.

As a central policy and coordinating agency responsible to the Prime Minister, the department promotes corporate values that, in particular, ensure:

• timely, responsive and high-quality service to the Prime Minister and to other ministers
• professionalism, commitment and excellence in the management of services, programmes and policy advice
• constructive and cooperative work relationships both within and outside the department
• adherence to the Australian Public Service (APS) Values and Code of Conduct
• broad career opportunities for staff
• a stimulating and caring work environment.

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The Executive

The Executive comprises the Secretary and the three deputy secretaries.

Associate Secretary Andrew Podger headed the Health Taskforce that was convened to examine and improve the delivery of health services around Australia. Mr Podger concluded his work with the department on 30 June 2005.

In October 2004, Deputy Secretary Patricia Scott was appointed to the position of Secretary of the newly formed Department of Human Services. The vacant deputy secretary position was filled in an acting capacity by Joanna Davidson until April 2005, when Louise Morauta, from the Department of Health and Ageing, was appointed to the position.

The senior leadership team

As at 30 June 2005, the department’s senior leadership team comprised the Secretary, three deputy secretaries, and nine first assistant secretaries each covering one of the department’s nine divisions (see Figure 3). Those divisions were International Division, Government Division, Social Policy Division, People, Resources and Communications Division, Economic Division, Industry, Infrastructure and Environment Division, National Security Division, Cabinet Division, and the newly formed APEC 2007 Taskforce.

The Office of the Status of Women was relocated to the Department of Family and Community Services under a machinery of government change in November 2004.

Senior leadership responsibilities

The Secretary, as the Chief Executive Officer, is responsible for providing the overall leadership of the department and shaping its future. He is responsible for determining priorities and appropriate resource allocations, delivering organisational performance and directing high-priority initiatives. He is also responsible for providing overall leadership to the APS.

In consultation with the deputy secretaries, the Secretary is responsible for guiding and monitoring corporate governance issues and providing strategic direction in the department. Together with division and branch heads, the Executive set the key targets for the 2004–05 financial year and provided the framework, through divisional and output workplans, within which the people and financial resources of the department were allocated.

Reporting arrangements for each of the deputy secretaries were as follows.

• Social Policy Division and People, Resources and Communications Division reported to Deputy Secretary Louise Morauta.
• International Division, National Security Division, Government Division and the APEC 2007 Taskforce reported to Deputy Secretary Andrew Metcalfe.
• Cabinet Division, Economic Division and Industry, Infrastructure and Environment Division reported to Deputy Secretary Jenny Goddard.

The responsibilities of the first assistant secretaries were as follows.

Ian Kemish, head of the International Division, supported the Prime Minister on international affairs, providing a whole-of-government perspective to advice on international issues coming before Cabinet, and coordinated advice to the Prime Minister on foreign affairs, trade and aid policies. In addition, the division was responsible for administering the state occasions and official visits programme.

Duncan Lewis, head of the National Security Division, provided whole-of-government advice to the Prime Minister and his office on national security issues and on defence and intelligence matters. In addition, the division provided secretariat and policy support to the National Counter-terrorism Committee and the Australian Government Counter-terrorism Policy Committee.

Barbara Belcher, head of the Government Division, provided policy advice on public administration, parliamentary and electoral matters; legal policy issues; the establishment of royal commissions; the implications of court decisions for the Commonwealth; matters relating to the arts, national collecting institutions and cultural heritage; and policy issues relating to Australian and foreign honours and the use of Australia’s national symbols.

Ruth Pearce, head of the APEC 2007 Taskforce, provided advice to the Prime Minister and his office on developments in preparation for APEC 2007 events. These included issues associated with preparation for the 2007 APEC Economic Leaders’ Meeting and related events in Sydney, confirmation of the involvement of all states and territories in the APEC 2007 ministerial and senior officials’ meetings (to be held across Australia), finalisation of a memorandum of understanding with the New South Wales Government in relation to logistics and security arrangements, and finalisation of the taskforce governance arrangements.

Joanna Davidson, head of the Social Policy Division, provided whole-of-government advice to the Prime Minister and his office on social policy issues, including education; employment; families; income support; community services; health and ageing; immigration; indigenous policy; veterans’ affairs; and women. The division also provided support to the secretaries’ group supporting the Ministerial Taskforce on Indigenous Affairs.

Greg Williams, head of the People, Resources and Communications Division, provided advice and support to the Ministerial Committee on Government Communications, managed the Central Advertising System and oversighted photographic services through AUSPIC. In addition, the division provided the department’s internal information services, covering information technology, library services, records management and ministerial correspondence. The division also provided support functions in regard to people management, finance, corporate governance, facilities, personnel and physical security. The division manages the Prime Minister’s official residences through the Official Establishments Unit and provides support for the Official Establishments Trust.

Peter Hamburger, head of the Cabinet Division, provided support to the Prime Minister and the Cabinet on the full range of Cabinet and Cabinet committee business, as well as providing support for the Federal Executive Council and monitoring the implementation of government policy through the Cabinet Implementation Unit.

Paul Tilley, head of the Economic Division, provided whole-of-government advice to the Prime Minister on domestic and international economic conditions and prospects; developments in financial markets; financial sector policy; workplace relations and wages policy; fiscal policy and budget initiatives; taxation and superannuation policy; and Commonwealth–state financial relations.

Phillip Glyde, head of the Industry, Infrastructure and Environment Division, provided whole-of-government advice to the Prime Minister on a wide range of policy issues covering industry; national competition policy; sustainable development (with a particular focus on water); agriculture, fisheries and forestry; environment and heritage; regional services; transport; communications; information technology; sport; tourism; energy; and Council of Australian Governments’ matters.

Senior leadership groups

The Executive Group is made up of the Secretary and the three deputy secretaries. It assists the Secretary in meeting his obligations as agency head by managing high-level corporate strategy, determining internal resource allocation and coordinating the involvement of the Executive in the leadership of the department. The Executive Group is scheduled to meet fortnightly.

The Corporate Leadership Group is the key corporate forum. It is scheduled to meet fortnightly and is attended by the Secretary, the deputy secretaries, the first assistant secretaries and the Assistant Secretary, People and Resource Management Branch. Its role is to provide active and visible strategic leadership to the department. It is responsible for setting overall directions and ensuring the department’s structure, culture and resources are aligned to meet its agreed outcomes, through:

• formulating and communicating the strategic directions and priorities for policy, program management, service delivery and performance
• allocating, reviewing and re-allocating (where necessary) resources, and developing plans to meet the department’s current and future priorities
• sponsoring good governance and promoting the APS Values and Code of Conduct and departmental behaviours and values
• generating a workplace environment marked by practical commitment to developing and harnessing the diverse skills of people in the organisation, open communication, and high levels of collaboration.

The relationships between the two senior leadership groups and the other elements of the department’s decision-making structure are shown in Figure 7.

Figure 7 Leadership and management committee structure

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Management committees

Six management committees assist the Secretary and play a vital role in the department’s decision-making processes.

In response to the release by the Australian National Audit Office (ANAO) of its better practice guide on corporate governance in July 2003, the department’s Audit Committee commissioned an evaluation of our corporate governance arrangements. As a result of the audit, the department’s internal committee structures were tightened and a more clearly articulated role and purpose for each of the management committees was developed. This work continued during 2004–05, with the further revision of the charter for each committee, and the addition of an intranet page on committee details to ensure that staff are aware of committee activities and roles.

Members of the Executive chaired five of the department’s high-level management committees—the Audit Committee, the People and Leadership Committee, the Consultative Committee, the Information Management Strategic Advisory Committee and the One National Circuit Steering Committee.

Collectively, these committees provided a continuous source of information and advice to the Executive and Corporate Leadership groups during 2004–05. Figure 8 shows the membership of each committee, while the committees’ functions are described in more detail in the following section.

a Meetings are held quarterly.
b Meetings are held as required.

People and Leadership Committee

The People and Leadership Committee, a formal subcommittee of the Corporate Leadership Group, provides strategic advice and support on people and leadership matters.

During the reporting period, the committee developed a set of ‘Working Smarter’ principles, which were launched by the Secretary on 29 October 2004. The Working Smarter principles were identified to help us achieve full commitment to our shared responsibility to examine our approaches to work, and devise new ways to deliver results, with a view to improving our individual and collective productivity in the medium to long term.

In February 2005, an inaugural gathering of the department’s entire Senior Executive Service (SES) leadership team was held to provide an opportunity to step away from the day-to-day working environment and reflect on broad management and leadership issues. We developed a shared understanding about what the department currently is, and arrived at a strong shared commitment to improve a number of areas of our business (strategic intent, leadership expectations of our people, improved working relationships, and refined decision-making processes). We have made a good start, and will continue to focus on improving how we operate as a department in the future. We agreed to have a minimum of three such gatherings each year.

Other key results achieved by the People and Leadership Committee during 2004–05 included the following:

• We conducted a review of the department’s corporate management committees, refined the rules of their composition, and devised new communication approaches that require all committees to advise staff when they intend to meet and make their records of meetings accessible as soon as possible after each meeting.
• We continued to refine the quantitative demographic analysis and reporting framework in place, to help us better understand emerging workforce trends and issues.
• We made major progress in addressing staff concerns relating to the performance management system, as identified in the 2003 staff survey.
• We improved staff understanding and awareness through training sessions, delivered by external facilitators, in giving and receiving feedback and in coaching and mentoring.
• We revised the upwards appraisal process of the Performance Management and Development Scheme in October 2004, and evaluated the scheme in May and June 2005 to identify scope for any further improvement.

Information Management Strategic Advisory Committee

The department’s Information Management Strategic Advisory Committee continued to provide an important forum for generating advice to the departmental Executive on strategies and policy for the effective use of information resources and on the development of information infrastructure and services that support the department’s business outcomes.

The Information Management Strategic Advisory Committee’s objectives are to:

• ensure alignment between the department’s business outcomes and information management strategies and people’s day-to-day work
• consider the department’s high-level strategic information management needs and make recommendations to the Executive Group for endorsement
• provide leadership and encouragement for cultural, process and organisational change as a result of information management initiatives.

During the year, the committee oversaw the development of a collection management and access policy for library information resources, and the development of a policy for the management of information and records that provides a framework for the effective creation, capture and management of information and records within the department.

Audit Committee

The Audit Committee meets quarterly and assists the department in meeting its corporate governance responsibilities.

The Audit Committee objectives are to:

• assist the Secretary and Executive Group in ensuring that the department meets its corporate objectives
• ensure that effective accountability and governance strategies, practices and policies are available to departmental staff, monitor the suitability and relevance of these elements, and decide on changes in consultation with the Executive Group
• promote an ethical climate in the department
• provide a forum for communication between the Executive, senior managers of the department and the department’s internal and external auditors.

The audits overseen by the committee are detailed in the Internal audit and fraud control section of this chapter.

Consultative Committee

The principal function of the Consultative Committee is to provide a forum for consultation between employees and managers on workplace relations matters and on issues of corporate significance, such as the departmental Certified Agreement and the associated policies and guidelines.

The key achievement for the Consultative Committee in 2004–05 was the successful negotiation of the department’s new certified agreement, titled Certified Agreement 2004–2007 Working Smarter to Achieve a Better Work/Life Balance, which came into effect on 6 October 2004 and will continue until 30 September 2007.

As the title suggests, the focus of the committee in the development of the agreement was to increase and maintain productivity while creating a workplace that encourages employees to balance their work and personal lives.

Security Committee

The Security Committee provides advice to the Executive Group on security matters, to support the department’s business outcomes.

The role of the committee is to:

• facilitate alignment between the department’s policies, procedures, security awareness and training and the Commonwealth Protective Security Manual 2005, the Australian Government Information and Communications Technology Security Manual and Commonwealth Security Bulletins
• facilitate a systematic, coordinated approach to security risk management across the department
• consider and make recommendations on the department’s physical, personnel, information and information technology security policies and procedures
• provide leadership and actively support the implementation of physical, personnel, information and information technology security policies, procedures, education and awareness across the department.

As at 30 June 2005, the committee had implemented new document-handling guidelines; reviewed security passes; provided advice on security for the new building; and facilitated the purchase of equipment to allow onsite classified waste destruction.

One National Circuit Steering Committee

The role of the One National Circuit Steering Committee is to provide strategic guidance to the team delivering new accommodation for the department at 1 National Circuit, Barton.

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Corporate governance initiatives

The Corporate Governance Unit, with responsibility for issues such as internal audit, fraud, risk management and contracts, continued and enhanced its previous corporate governance work. Achievements in 2004–05 included:

• updating the corporate governance framework to clearly articulate the roles and responsibilities within the departmental committee structure
• reviewing and amending departmental standard contracts to incorporate additional contract clauses relating to the new Commonwealth Procurement Framework
• providing practical advice and assistance to staff required to handle procurement and contracting issues
• initiating a major review of the Chief Executive Instructions (CEIs)
• initiating the development of new plans for fraud control and risk management.

On behalf of the department, the unit again took part in the Comcover Risk Management Benchmarking Survey, which is intended to assist agencies to develop and improve risk management techniques within their organisations.

The review of monthly Corporate Reports to the Secretary was concluded. The redesigned reports now provide the Secretary and the Executive with more targeted snapshots of progress on the specific issues of financial performance, human resource matters, departmental travel, security, parliamentary questions, freedom of information, and ministerial correspondence.

Monthly meetings of the department’s Divisional Support Unit managers were continued, to encourage discussion on topical issues in relation to administrative procedures and processes pertinent to their divisional support role.

As in previous years, during 2004–05 the department’s Business Continuity Plan, which draws on a broad range of other documents (including the Risk Management Plan, the Departmental Security Plan, the Fraud Control Plan and the Financial Management Information Systems Business Continuity Plan), was fully updated to ensure its continuing validity. The revised plan will be tested regularly through a variety of mechanisms and at meetings of the Corporate Leadership Group.

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Internal audit and fraud control

In 2004–05 the department’s Audit Committee presented and considered eight internal audits, comprising a mix of compliance and assurance reviews that covered a wide range of internal administrative matters. Significant internal audits conducted during the year are summarised below.

CABNET

Recommendations from the review of the CABNET secure document management system included implementing a more rigorous approach to change management and updating document management procedures.

Procurement management

Recommendations from the review of procurement management included raising awareness of procurement risks, promoting training on procurement and encouraging the use of panels.

Internet security

Recommendations of the internet security review centred on ensuring policies and procedures, and their application, are documented.

Information technology security

This review recommended that the department update its information technology business continuity plan, ensure adequate security training and awareness across the department, complete the information technology strategic plan, and document related procedures and policies.

Cabinet Implementation Unit

In a post-implementation review of the Cabinet Implementation Unit, stakeholders commented positively on the unit’s work, particularly in relation to changes to the ways new policy proposals are developed and significant policy measures are tracked. The review recommended strategies to increase the unit’s effectiveness, and these are being implemented.

Contract management for information technology services

The contract management review’s recommendations centred on ensuring that information technology service provider staff are adequately trained, and adequate back-up and recovery services procedures are in place.

Post-payment checking

The review of post-payment checking noted that, apart from a few minor administrative matters, there was no evidence that the department did not maintain, in all material respects, effective control procedures in relation to the processing of payments.

Business continuity and disaster recovery arrangements

This review recommended that the department continue to test its business continuity and disaster recovery plans and update them as issues arise.

Ethical standards

The department continued to promote the importance of maintaining the high ethical standards appropriate to APS employees. The APS Values and Code of Conduct, as specified in the Public Service Act 1999, assist in increasing employee commitment and performance and help shape an ethical culture. Departmental guidelines on working with the code of conduct and on understanding the APS values formed an integral part of the human resource framework and were readily accessible to staff via the intranet. Promotional material, such as the APS Commission’s bookmark on the APS Values and Code of Conduct, continued to be regularly distributed and included in the department’s kit for new starters. In addition, the department continued to highlight the importance of adherence to the APS Values and Code of Conduct in the wording of the Certified Agreement and during induction courses available to all new starters.