Board charter

Iota Board Charter
1. Introduction
1.1 The Iota Board is responsible for the overall governance of Iota Services Pty Ltd (Iota). This Charter sets out the authority, accountabilities, roles and responsibilities, membership and operation of the Iota Board. The Iota Board is accountable to South East Water and presides over all significant strategic, commercial, regulatory, financial and risk-focused elements of Iota.
1.2 In performing its role, the Iota Board recognises its overriding responsibility to:
• act at all times in a manner consistent with Iota’s functions and objectives, as well as its stated purpose and values;
• act honestly, fairly, diligently and in accordance with other statutory requirements that govern public sector bodies and public entities in Victoria and the Corporations Act;
• have regard to Iota’s relationship with stakeholders and the communities in which it operates; and
• Conduct its operations in accordance with the public sector values of responsiveness, integrity, impartiality, accountability, respect, leadership and human rights.
1.3 Through its continued oversight of South East Water, the Minister for Water will retain an indirect power to control the activities of Iota as a separate legal entity. As a wholly-owned subsidiary of South East Water, Iota will be a public entity under the Public Administration Act 2004.
2. Constitution and heads of agreement
2.1 Iota’s constitution and heads of agreement (between Iota and South East Water) are Iota’s key governance documents. The Iota Board is responsible for ensuring that Iota complies with the provisions of those documents.
3. Role and responsibilities of the Iota Board
3.1 The Iota Board is responsible to South East Water for Iota’s overall strategy, governance, operations and performance of Iota functions.
3.2 Strategic direction;
a. providing strategic direction and assisting management to develop and monitor strategic and performance objectives and ensuring that these take appropriate account of State Government policy (including the competitive neutrality policy, intellectual property strategy and policy); and
b. guiding the preparation of Iota’s strategic plan and obtaining approval of that plan from South East Water.
3.3 Financial performance, reporting and risk management;
a. providing oversight of the management of the affairs of Iota, including regularly reviewing the operational performance (including the financial position and health, safety, environmental (including climate change) and sustainability performance) of Iota against performance measures and taking corrective action as required;
b. providing oversight, and monitoring the financial performance of Iota and ensuring appropriate and accurate financial records are kept;
c. ensuring Iota’s financial and other reporting mechanisms are designed to result in adequate, accurate and timely information being provided to the Iota Board;
d. providing accurate financial reports and other information to South East Water, the Minister for Water, the Treasurer and the Premier or other parties as required by law;
e. endorsing the key performance indicators for delivery of Iota’s strategy;
f. monitoring development of performance indicators and targets and reviewing Iota’s performance against those targets;
g. endorsing, and where appropriate, approving regulatory and shareholder reports issued by Iota;
h. notifying South East Water if it believes anything has arisen that may prevent, or significantly affect, the achievement of Iota’s objectives or financial targets;
i. providing oversight of the risk culture and process to ensure key financial and non-financial risks (including those associated with climate change) are identified, assessed and appropriately managed through appropriate risk management and compliance systems, including a regular review (at least annually) of the risk profile;
j. informing South East Water, and where required, the Minister for Water and the Treasurer, of any significant issues and events and in particular, emerging or existing key risks and of the systems in place to address those key risks;
k. ensuring all other information is provided to the State Government in an accurate and timely manner, as required under legislation or government policy; and
l. approving dividend payments for payment to Iota’s sole shareholder, South East Water.
3.4 Governance and compliance;
a. Providing oversight of management’s actions to ensure that Iota has an appropriate governance framework to promote compliance with relevant laws, regulations and standards applying to the activities of Iota;
b. ensuring an effective internal control framework and an appropriate balance in the authority over finances so that no single person has unfettered power of the finances of Iota;
c. reviewing and approving Iota’s budgets and business plans and monitoring major capital expenditures, acquisitions and divestitures and capital management generally to ensure that these comply with South East Water and government procurement policies, as applicable;
d. ensuring that Iota acts in a responsible and ethical manner and that reasonable steps are taken to ensure compliance with South East Water’s code of conduct and other governance policies;
e. establishing performance measures for the General Manager Iota, undertaking an annual performance assessment and providing feedback on performance;
f. developing and approving the General Manager Iota’s succession plan;
g. notifying South East Water, and where required, the Minister for any breach of the processes in place to deal with conflicts of interest by Directors; and
h. ensuring that adequate controls are in place to prevent fraudulent behaviour.
4. Powers of the Iota Board
4.1 The Delegations of Authority, sets out key matters reserved for the Board of Iota including:
a. approving the appointment and removal of the General Manager Iota and Company Secretary, in consultation with the Board of South East Water;
b. approving capital expenditure up to the value of $5 million;
c. authorising cost overrun(s) of up to 10 percent on projects approved by the Board of Iota; and
d. approving decisions regarding various debtor amounts.
5. Iota Board membership
5.1 The Iota Board will consist of not less than one and not more than 10 Directors. The Iota Board will comprise a majority of independent Directors. The composition of the Iota Board will be determined by South East Water, consistent with good corporate governance and subject to Iota’s Constitution. South East Water will ensure that the Iota Board has an appropriate blend of skills, experience and diversity to deal with the current and emerging issues of Iota.
5.2 An independent Director is a non-executive Director (that is, not a member of management) and:
a. within the last three years has not been employed in an executive capacity by South East Water or a related organisation, or has been a Director after ceasing to hold any such employment;
b. within the last three years has not been a principal of a material professional adviser or a material consultant to South East Water or a related organisation, or an employee materially associated with the service provider;
c. is not a material supplier or customer of South East Water or a related organisation or an officer or otherwise directly or indirectly associated with a material supplier or customer;
d. has no material contractual relationship with South East Water or a related organisation other than as a Director of South East Water;
e. has not served on the Iota Board for such a period that his or her independence may have been compromised;
f. is free from any interest or business or other relationship which could, or could reasonably be perceived to, materially interfere with the Director’s ability to act in the best interests of Iota; and
g. there are no family ties or cross directorships that may compromise independence.
5.3 For the purpose of these provisions, “principal” does not include a non-executive Director and “material professional adviser” does not include a professional adviser providing less than 25% of professional advisory services of a same or similar nature to South East Water and its group members.
6. Meetings
6.1 The Iota Board must ensure that procedures are in place for the conduct of effective Iota Board meetings and resolving disputes between Directors.
6.2 Meetings shall be formally structured and held in accordance with Iota’s Constitution.
6.3 The quorum for a meeting of the Iota Board is three Directors.
6.4 The Chair will ordinarily preside over an Iota Board meeting. In their absence, a Director elected by those Directors present at the meeting will preside over the meeting.
6.5 The Directors will hold their meetings as frequently as required and will also meet whenever necessary to deal with urgent matters.
6.6 Executives will be invited for the relevant part of the meeting where they are scheduled to give presentations or where the Iota Board considers it necessary to do so for the effective consideration of a particular agenda item.
6.7 The Iota Board may invite external advisers to attend Iota Board meetings where necessary or desirable.
6.8 The agenda for each meeting is prepared by the Chair, General Manager, Iota and Company Secretary. The agenda and papers are to be distributed to Directors five clear business days in advance of each scheduled meeting. Draft minutes of each meeting will be prepared promptly for review by the Chair.
7. Code of Conduct
7.1 South East Water’s Code of Conduct will be adopted by the Board of Iota. The Iota Board is accountable for Iota’s actions and must take reasonable steps to ensure that it is being properly informed by the General Manager, Iota and other senior staff.
7.2 The Directors consider there are fundamental ethical values that underpin their role as Directors of Iota and as members of its Board. The Iota Board is also required to comply with the Code of Conduct for the Directors of Victorian Public Entities. These duties are outlined in the South East Water and Iota Services Pty Ltd Directors Handbook.
8. Roles and responsibilities of Chair, General Manager, Iota and Company Secretary
8.1 The Chair is appointed by the Board of South East Water and presides over meetings of the Iota Board.
8.2 The Chair is responsible for:
a. providing effective leadership of the Iota Board;
b. efficient organisation and conduct of the Iota Board’s functioning;
c. ensuring the briefing of all Directors on all matters relevant to their role and responsibilities and issues arising at Iota Board meetings;
d. maintaining open communication between management and the Iota Board; and
e. ensuring that Iota can interact effectively with the Minister, where required;
f. ensuring all Directors are given opportunities and encouraged to undertake professional development relevant to their roles; and
g. encouraging independence and diversity of thought in the boardroom
8.3 The Chair has no additional powers or authority beyond that of other Directors in respect of decisions about Iota’s business (other than a ‘casting vote’ as provided for in Iota’s Constitution).
8.4 The Chair must ensure the Iota Board undertakes its duties to an appropriate standard and in accordance with the Code of Conduct and other governance requirements.
8.5 The General Manager, Iota’s duties are to:
a. be accountable for planning, coordinating and directing the operations of Iota to achieve strategic, financial and operating objectives as agreed with the Iota Board;
b. formulate and recommend business and financial strategies and plans to develop Iota’s business and to implement these plans to achieve agreed performance targets; and
c. faithfully, diligently and with care and skill perform the duties and exercise the powers assigned by the Board of Iota.
8.6 In fulfilling his or her duties, the General Manager, Iota:
a. reports to the Board of Iota;
b. provides prompt and full information to the Iota Board regarding the conduct of the business of Iota; and
c. complies with reasonable directions given by the Iota Board and implements Iota Board approved strategies and policies.
8.7 The Company Secretary is responsible to the Iota Board, through the Chair, on all governance matters.
8.8 The Company Secretary will advise the Chair, the Iota Board, and individual Directors on all matters of governance processes including:
a. assisting the Chair and the General Manager, Iota to schedule and set agendas for Iota Board meetings;
b. attending Iota Board meetings and preparing minutes of meeting and resolutions;
c. organising and facilitating the induction and professional development of Directors;
d. providing advice and assistance to the Iota Board with respect to corporate governance matters;
e. keeping and updating a register of interests; and
f. coordinating the annual review of Iota Board performance.
8.9 The Company Secretary’s advice and services is available to all Directors.
9. Conflict of interest
9.1 The Iota Board must ensure that processes are in place to deal with conflicts of interest in Directors that apply to both financial and non-financial interests. That process must:
a. require Directors to make a full disclosure of the conflict(s) of interest at meetings of the Iota Board;
b. require that disclosure(s) to be recorded in the minutes of the Iota Board meeting;
c. require the Iota Board to determine whether the conflict of interest is material; and
d. enable the Iota Board to require the Director who has a conflict of interest in a matter to be absent from the meeting while the Board is considering that matter or prohibiting the Director from taking part in any decision of the Board on that matter.
9.2 A gift, benefit and hospitality policy is in place for directors and employees.
9.3 The Company Secretary must keep a register of members of the Iota Board and nominated officers’ interests and potential conflicts of interest and report to the Iota Board as necessary. Any Director may request and be granted access to the register of interests.
9.4 Directors have a responsibility to keep this register up-to-date by advising the Company Secretary of any changed or new personal circumstance when they occur.
10. Legal obligations of Directors
10.1 Directors are public officials who are required to comply with the public sector values of responsiveness, integrity, impartiality, accountability, respect, leadership and human rights. In accordance with Section 187 of the Corporations Act 2001, Iota’s Constitution expressly authorises Directors to act in the best interests of its parent entity, South East Water.
10.2 Directors must at all times act in accordance with legal and statutory requirements and properly discharge all their duties as Directors.
11. Iota Board Committees
11.1 The Iota Board may from time to time establish committees or sub-committees as it considers necessary or appropriate to assist it in carrying out its responsibilities.
11.2 All Directors may attend any meeting of any Iota Board committee.
11.3 The committee will act in accordance with its Iota Board approved charter. The charter is to set out matters relevant to the composition, powers, responsibilities and administration of such committees, and other matters that the Iota Board may consider appropriate.
11.4 Committees of the Iota Board are permitted to make decisions within the powers delegated to the Committee by the Iota Board.
11.5 Composition, purpose and scope of Iota Board committees should be reviewed on an annual basis and members are to be rotated as required.
12. Relationship with management
12.1 Directors have a right to sufficient information to enable them to properly discharge their duties. Management will supply the Iota Board with information in a form, timeframe, and quality that will enable the Board to discharge its duties effectively.
12.2 The Iota Board has unrestricted access to management, usually via the General Manager, Iota or Company Secretary.
12.3 The Chair is the principal source of non-executive advice to the General Manager, Iota between meetings. The General Manager, Iota should inform the Chair of any important and urgent matters that arise between Iota Board meetings.
13. Access to information
13.1 A Director is to have right of access to the financial records of Iota at all reasonable times.
13.2 In order to properly fulfil their obligations, Directors have a right to sufficient information to enable them to properly discharge their duties.
13.3 In this respect, Directors should:
a. request such information as they require to fulfil their responsibilities as a Director of the company;
b. respect the need for confidentiality of such information, including, if necessary, viewing it in a confidential place at the offices of Iota; and
c. direct such requests for information through the Chair – who, in turn, shall advise the General Manager, Iota.
14. Directors’ and officers’ indemnity
14.1 Iota will indemnify Directors from liabilities incurred by them in that role, if it is not in respect of a liability:
a. to Iota or a related entity;
b. for which the Director has been ordered to pay a pecuniary penalty or compensation under certain provisions of the Corporations Act 2001; or
c. that is owed to someone other than Iota or a related entity and did not arise tout of conduct in good faith..
14.2 Indemnity for the Director’s liability for legal costs is also excluded in certain circumstances under the Corporations Act 200, including if the costs are incurred in respect of a liability of the type detailed in clause 14.1 above, or in respect of criminal proceedings, if the person is found guilty.
15. Directors’ insurance
15.1 Iota will insure Directors against liabilities incurred in the performance of that role, other than for liabilities arising from wilful breach of duty or for misuse of their position as Directors or of the company’s information. Insurance will be maintained for each member of the Iota Board for at least seven years after they cease to hold office.
16. Independent professional advice
16.1 Iota will meet the reasonable expenses of the Iota Board as a whole, or a Director acting individually, obtaining independent professional advice in relation to the carrying out of their functions and exercising their powers.
16.2 Individual Directors who wish to obtain independent advice must seek prior approval of the Chair of the Board of Iota.
17. Director induction and development
17.1 Each director is expected to participate in an induction programme on appointment, and will be given the opportunity and encouraged to undertake ongoing and continuous appropriate professional development to maintain skills and knowledge needed to perform their roles on the Board.
18. Performance
18.1 The Iota Board will evaluate its performance on an annual basis.
19. Review of Charter
19.1 This Iota Board Charter is to be reviewed annually, or as agreed by the Board of South East Water.