The ASX Corporate Governance Council proposes new
recommendations under its Corporate Governance Principles and
Recommendations requiring a listed company on an "if not why
not" basis to:
establish a diversity policy that includes measurable
objectives relating to gender as set by the board of the company
and disclose it to the market in full or in summary
disclose in its annual report its achievement against the
gender objectives set by the board
disclose in its annual report the proportion of women employees
in the whole organisation, in senior management and on the
There are also changes that will be made to the commentary for
the existing Recommendation 2.4 dealing with the establishment of a
board nomination committee. The commentary is aimed at providing
guidance to listed companies and will encourage the nomination
committees of listed companies to include in their charters a
requirement to continuously review the proportion of women at all
levels in the company. Commentary will also highlight the
responsibility of the nomination committee to address strategies on
board gender diversity and diversity in general.
There will also be changes to the commentary for the existing
Recommendation 2.5 (dealing with disclosure of the process for
evaluating board performance) requiring that the performance review
of the board include consideration of diversity criteria in
addition to skills. Boards will be required to disclose what skills
and diversity criteria is sought in any new board appointment.
The changes will compel listed companies to pursue diversity at
all levels within the organisation and adopt and disclose
appropriate gender objectives and policy.
Gender diversity will become an important issue for boards of
listed companies and will require companies to focus on developing
diversity policy with measurable objectives relating to gender in
the next 6 months.
Companies should commence the process for establishing an
appropriate policy and objectives that can be measured and against
which company achievements may be reported annually as soon as
There are also proposals to:
improve listed companies' record keeping of analyst
briefings, by providing guidance that companies keep a summary of
topics discussed at group briefings with investors and analysts
(including a list of persons present, and the time and place of the
meeting), give advance notice of group briefings and make them
widely accessible; and
elevating the guidance on the composition of a remuneration
committee, with a majority of independent directors, chaired by an
independent director and have at least 3 members, to a
recommendation, requiring companies to report on an "if not
why not" basis.
The ASX Corporate Governance Council expects to issue an
exposure draft of the proposed changes for public consultation in
early 2010 with the changes anticipated to be implemented on 1 July
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The decision deals with the tension between a "reasonable endeavours" obligation and a promisor's commercial interests.
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