24 October 2015

Corporate Governance Reporting Changes

The 3rd Edition of the ASX Corporate Governance Principles and Recommendations takes effect from the financial year ended 30 June 2015.

The key change is the option for a company to publish its current corporate governance statement outside the Annual Report.

The major aspects around publication are:

  • the corporate governance statement and any related disclosures should appear in a clearly delineated Corporate Governance section of the Annual Report or on an easily accessible corporate governance landing page on the entity’s website
  • where disclosure is made on a website, the Annual Report must clearly state where interested parties can read or obtain a copy of that material (for example the URL of the relevant web page). A copy of the current statement must be provided to the ASX at the same time as the Annual Report
  • if an entity’s board considers that a corporate governance recommendation is not appropriate to its particular circumstances, it is entitled not to adopt it. However, it must explain why it has not adopted the recommendation – the ‘if not, why not’ approach
  • listed entities should provide a holistic and informative explanation of their corporate governance framework rather than a mere compliance document. It should demonstrate board and management commitment to the importance of proper and effective corporate governance arrangements and a robust approach to corporate governance.

A number of ASX listed companies chose to adopt the 3rd Edition Principles earlier than required.

The full 3rd Edition can be downloaded at http://www.asx.com.au/documents/asx-compliance/cgc-principles-and-recommendations-3rd-edn.pdf