The six year sentence meted out in June 2002 to the CFO of local company Harris Scarfe, has again highlighted, for directors living or working in South Australia, the risks and dangers of boardroom responsibility.
While the sentence is under appeal and the former CFO seeks to convince the appeal court that the sentence for admitted wrong doing was too heavy, the spotlight for directors now falls on the governance issues relating to executive remuneration. Against the background of this clear illustration of the vulnerability of directors to the competence and honesty or lack of it of the executives on whom directors ordinarily rely, a number of issues arise. What executive incentive arrangements encourage misreporting? How can the results that lead to incentive payments be independently verified? When can directors safely rely on information or advice from their executives? Concern for issues of this kind, no doubt influenced, as well, by the HIH and One.Tel inquiries, has emphasised the need for professional director education and has seen a marked increase in the number of South Australian and Northern Territory directors and senior executives undertaking both the flagship Company Director Course as well as shorter one-day professional development programs. In response two additional intensive week long programs have been scheduled for later in the year one in Adelaide and, for the first time, one in Alice Springs.
Of increasing importance in our educational offering have been workshops dealing with particular issues but designed for a particular company and presented to the board as a whole. The approach has gained wide support and is seen as an extremely effective way of getting the whole board up to speed on developments as well as considering more fundamental issues in an atmosphere different from an ordinary board meeting. The demand for in-house tailored workshops has also strengthened in the present climate and our tutors have been invited into the boardrooms of both private and not for profit organisations. The year 2002 has seen the election of a new Labour Government in South Australia. Premier Mike Rann has demonstrated a refreshingly pro-business approach. He has already told AICD of his commitment to good corporate governance and is currently reviewing government boards. In this endeavour the AICD has much to offer and discussions are progressing on how that contribution might occur. On the legislative front, the SA & NT Division keeps a watchful eye on proposed enactments that might tend to impair the effectiveness of companies and directors or undermine the basic principle of limitation of liability. So far, the report card raises no significant alarm bells.
Besides offering its educational contribution and pursuing director related policy concerns, in Adelaide and Darwin, AICD plays a popular role in informing the director community on topical issues through luncheon speakers and other seminars. Speakers have included, Keith Lambert, managing director of Southcorp and Allan Moss, managing director of Macquarie Bank. In coming weeks we are looking forward to hearing from Stephen Gerlach, chairman of Santos Ltd and Roger Corbett, managing director of Woolworths Ltd. At our October lunch last year Richard Butler, on line from his New York office, gave a fascinating perspective on the events of September 11. Inspired by this approach, management in the Adelaide office has developed a new luncheon series in 2002. Known as the Thought Leader Luncheons, the series has offered the opportunity to hear from thought-provoking and sometimes controversial speakers. It has featured outstanding local and international personalities who have contributed to debate on change. Speakers have included Alistair Mant who addressed the topic of "Intelligent Leadership" and Chin-Ning Chu author of The Working Woman's Art of War.
The purpose of this database is to provide a full-text record of all articles that have appeared in the CDJ since February 1997. It is aimed to assist in the research and reference process. The database has a full-text index and will enable articles to be easily retrieved.It should be noted that information contained in this database is in pre-publication format only - IT IS NOT THE FINAL PRINTED VERSION OF THE CDJ - therefore there might be slight discrepancies between the contents of this database and the printed CDJ.
Already a member?
Login to view this content