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Board Charter

1. Introduction

The Sydney Ports Corporation (SPC) was established as a corporation by the Ports and Maritime Administration Act 1995 and is subject to the State Owned Corporations Act 1989.

The principal functions of SPC are:

(a) To establish, manage and operate port facilities and services in its ports; and

(b) To exercise the port safety functions for which it is licensed in accordance with its operating licence.

If there is any inconsistency between this Charter and the applicable legislation or Memorandum and Articles of Association ("Articles"), the legislation and Articles will prevail.

2. Objectives

2.1 The overall role of the Board is to:

  • Set corporate direction and goals;
  • Oversee the plans of management to achieve these goals; and
  • Review progress at regular intervals.

2.2. The Board is responsible for ensuring that SPC has an appropriate corporate governance structure to ensure the implementation of its objectives namely:

(a) to be a successful business and, to this end,

  1. to operate at least as efficiently as any comparable businesses, and
  2. to maximise the net worth of the State’s investment in Sydney Ports, and

(b) to exhibit a sense of social responsibility by having regard to the interests of the community in which it operates, and

(c) where its activities affect the environment, to conduct its operations in compliance with the principles of ecologically sustainable development contained in section 6(2) of the Protection of the Environment Administration Act 1991, and

(d) to exhibit a sense of social responsibility towards regional development and decentralisation in the way in which it operates;

(e) to promote and facilitate trade through its port facilities, and

(f) to ensure that its port safety functions are carried out properly

2.3 The Board is also responsible for ensuring SPC recognises its legal and other obligations to all legitimate stakeholders from time to time where and to the extent appropriate.

2.4 SPC will adopt the NSW Treasury Guidelines for Boards of Government Businesses (Guidelines).

3. Membership

3.1 Number of Directors

In accordance with the State Owned Corporations Act 1989, the Board shall have not fewer than 3 and not more than 7 Directors appointed by the Governor on the recommendation of the voting shareholders. The Voting Shareholders must consult the Portfolio Minister regarding Director appointments.

Of the Directors:

(a) One is to be a staff Director; and

(b) The others are to be persons, who in the opinion of the voting shareholders, will assist SPC to achieve its principal objectives.

3.2 Chief Executive Officer (CEO) Appointment

SPC is to have a CEO appointed by the Governor on the recommendation of the Portfolio Minister, following a recommendation from the Board. The CEO may be appointed as a Director.

3.3 Election of the Staff Director

The Staff Director is elected in accordance with the procedure detailed in the Ports and Maritime Administration Act 1995.

3.4 Rotation of Directors

Directors are appointed for a term specified in their letter of appointment (not exceeding 5 years).

3.5 Remuneration

Remuneration of Directors is determined by the Voting Shareholders.

3.6 Independence

All Directors are expected to exercise independent judgment when making Board decisions. A Director is considered independent if he or she is independent in character and judgement and there are no relationships or circumstances which could materially interfere with, or appear to materially interfere with, the exercise of independent judgement. An independent Director is a Non-executive Director. A Director will be deemed independent where the Director:

  • is not employed, or has not been employed in a senior management position by the business, and there has been a period of at least three years between ceasing that employment and serving on the Board;
  • has not within the last three years been a principal of a material professional adviser or consultant to the business, or an employee materially associated with the service provided;
  • is not a material* supplier or customer of the business, or an officer of or otherwise associated directly or indirectly with a material supplier or customer; or
  • has not had a material* contractual relationship with the business other than as a Director of the business.

* Material means greater than 5% of SPC’s gross revenues.

The Staff Director is deemed to not be an Independent Director.

3.7 Board Committees

To assist the Board in fulfilling its duties and responsibilities, it has established an Audit & Risk Committee and a Remuneration Committee. Each Committee has a formal Charter. With the exception of certain limited delegations contained in their Charters, recommendations of the Committees are to be referred to the Board for approval. A Recruitment Committee was also established for the specific purpose of recruiting the current Chief Executive Officer, however this Committee is now inactive.

3.8 Conflicts of interest

Directors are required to disclose any potential conflicts for recording in SPC’s conflicts register. Directors are required to update this register on an ongoing basis as circumstances change.

In relation to specific Board decisions, the Board complies with Clause 2, Schedule 10 of the State Owned Corporations Act 1989. A Director cannot take part in discussions or vote on a matter is which that Director has a material personal interest, unless the Board resolves that the interest does not disqualify the Director.

The Guidelines recommend that Directors should not hold directorships of more than three Government boards. SPC supports this recommendation and Directors are required to inform the Chair prior to accepting any new appointments in the NSW public sector and inform the Chair of any other appointments.

4. Information and Independent Advice

4.1 Appointment Letter

Upon appointment, a new Director will be given a formal letter of appointment from the Shareholding Ministers setting out the key terms and conditions of their position.

4.2 Induction Program

Upon appointment, the Secretary & General Counsel is responsible for arranging for the new Director to undertake an induction program to enable them to gain an understanding of SPC’s business. A range of information is provided, including:

  • Copies of relevant legislation;
  • Code of Conduct;
  • Most recent annual report;
  • Board profiles and contact details;
  • Board and Committee charters
  • Statement of Corporate Intent and Corporate Plan; and
  • Recent Board and Committee meeting minutes.

In addition, new Directors are provided with access to an induction program to gain an understanding of SPC’s:

  • strategy, objectives and business;
  • industry in which SPC operates;
  • corporate governance practices;
  • current financial and business performance;
  • key executives;
  • remuneration strategy; and
  • risk management framework

4.3 Ongoing Education

Directors are encouraged to continue their education and SPC will fund any appropriate development activities, including membership of the Australia Institute of Company Directors. Directors are also provided with regular site visits and workshops to ensure they understand the nature of the business.

4.4 Ongoing Information

The CEO, Secretary & General Counsel and other Executive Management must be conscious to ensure that updated information is provided to the Board in a timely fashion to enable them to effectively discharge their duties as Directors. This may be part of, or in addition to, the periodic Board reporting process.

4.5 Requested Information

Directors are entitled to request and receive such additional information as they consider necessary to support informed decision-making. Any Director has the authority to seek any information he/she requires from any employee or contractor of SPC, and all employees must comply with such requests.

Unless a conflict exists or to do so would be inconsistent with the Director’s duties, the Director is to request such information via the Chair, CEO or Secretary & General Counsel.

4.6 Independent Advice

The Board and each individual Director, subject to informing the Chair, has the right to seek independent professional advice from a suitably qualified advisor, at SPC’s expense, to assist them to carry out their responsibilities. Where appropriate, a copy of this advice is to be made available to all other members of the Board.

5. Meetings

5.1. The Board generally meets on a monthly basis and it meets more frequently as circumstances require. Where the Chair considers appropriate, matters may be dealt with by the Board through special Board meetings or circular resolution.

5.2 The Secretary & General Counsel is responsible for ensuring the Board receive papers in advance of meetings and taking minutes of the meetings.

5.3 The CEO (if not an appointed Director) and other members of executive management, at the discretion of the Board, are invited to attend Board meetings and are also available to be contacted by Directors between meetings. However, the Board will meet without executive management present on a regular basis.

6. Duties and Responsibilities

6.1 The Board is responsible for overseeing the business and commercial affairs of SPC including:

  • establishing a clear set of governance roles and responsibilities
  • providing leadership on strategy development and approving the strategy;
  • overseeing the preparation of major plans, including the Statement of Corporate Intent;
  • approving the business and financial objectives;
  • monitoring business and financial performance, including performance against the Statement of Corporate Intent;
  • acting as an interface and key point of accountability between SPC and its Voting Shareholders and from time to time, in accordance with the State Owned Corporations Act 1989, the Portfolio Minister;
  • reviewing performance, employment terms and conditions and remuneration of the CEO and executive management;
  • reviewing and monitoring the risk management and internal control framework;
  • providing recommendations to the Portfolio Minister for the appointment of the Chief Executive Officer;
  • appointing and removing the Corporate Secretary;
  • establishing appropriate delegations to Board Committees and the CEO;
  • approving SPC’s dividend policy and the timing and amount of any dividend payments; and
  • reviewing, and approving where appropriate, reporting to Shareholding Ministers, including annual financial statements.

6.2 All Directors are entitled to be heard at all Meetings and to the extent practicable, should bring an objective judgement to bear in decision-making.

7. The Chair

The Chair is appointed by the Voting Shareholders and is responsible for:

  • leadership of the Board;
  • overseeing the Board in the effective discharge of its role;
  • the efficient organisation and conduct of the Board’s function and meetings; and
  • facilitating the effective contribution of all Directors.

8. The Chief Executive Officer (CEO)

The CEO is responsible for the day to day management of the operation of SPC in accordance with the general policies and specific directions of the Board. It is the responsibility of the Board to oversee the activities of management in carrying out these delegated duties. More specifically, the CEO is responsible for

  • working with the Board to build an appropriate organisational culture and values;
  • appointing the senior management team in consultation with the Board;
  • developing SPC’s strategy for review and approval by the Board;
  • working with the Board to determine long term and short term objectives;
  • implementing the Board approved strategy; and
  • keeping the Board appropriately informed of the operations of SPC.

9. The Shareholding Ministers

The Board is accountable to the Voting Shareholding Ministers. The Board must prepare and submit annually to the Voting Shareholders a Statement of Corporate Intent. SPC must prepare a quarterly progress report against the Statement of Corporate Intent to submit to the Shareholding Ministers.

In addition SPC must provide a half year and annual report. SPC must supply information as requested by the Voting Shareholders.

10. Portfolio Minister

The Portfolio Minister is responsible for administering SPC’s foundation charter, the Ports and Maritime Administration Act 1995. The Portfolio Minister may direct SPC to perform, or cease to perform, or not perform certain activities. However if the Board considers that it is not in the commercial interest of SPC to carry out the direction, the Portfolio Minister, with the approval of the Treasurer may, by written notice to the Board, direct SPC to do so. If this occurs, SPC is entitled to be reimbursed for any net cost of complying with the direction.

The Portfolio Minister, with the approval of the Treasurer, can notify SPC of any public sector policy to apply to SPC and give the Board a direction that is in the public interest. Before giving such a direction, the Portfolio Minister must consult with the Board and the Board must advise whether, in its opinion, it is in the best interests of SPC. If this occurs, SPC is entitled to be reimbursed for any net cost or foregone revenue of complying with the direction.

SPC must provide the Portfolio Minister with information as requested from time to time.

11. Corporate Governance

The Board is responsible for the adoption, oversight and administration of relevant corporate governance materials of SPC.

The Annual Report includes a Corporate Governance Statement which will contain the content required by the Guidelines (as well as an explanation of any departures from the Recommendations). As part of an effective communications strategy, SPC will maintain and keep current its Corporate Governance website.

12. Performance

To determine whether it is functioning effectively, the Board shall:

  • review this Charter periodically; and
  • perform an evaluation of its performance at intervals considered appropriate by the Chair.