- Title page
- Purpose of this guidance
- Who is this guidance for
- How to use this guidance
- Chapter 1: Relevant legislation
- Chapter 2: Functions and powers of the entity
- Chapter 3: Key relationships
- Chapter 4: Collective duties of the board and individual duties of board members
- Chapter 5: Role of the board chair
- Chapter 6: General responsibilities of members
- Chapter 7: Members' interests and conflicts: identification, disclosure and management
- Chapter 8: Disclosure of information
- Chapter 9: Gifts and hospitality
- Chapter 10: Board meeting procedures
- Chapter 11: Board committees
- Chapter 12: Delegations
- Chapter 13: Crown entities as employers
- Chapter 14: Subsidiaries
- Chapter 15: Planning and reporting
- Chapter 16: Board and member performance evaluation
- Chapter 17: Board appointments and reappointment
- Chapter 18: Remuneration and expenses for board members
- Chapter 19: Liability and protection from legal claims or proceedings
- Summary of minimum content for a governance manual by chapter
Chapter 3: Key relationships
One of the primary purposes of the Crown Entities Act 2004 (CE Act) is "to clarify accountability relationships between Crown entities, their board members, their responsible Ministers on behalf of the Crown, and the House of Representatives" (s. 3 CE Act) in order to assist good governance of the entity.
In simple terms this could be summarised as:
- the responsible Minister is accountable to the House of Representatives;
- the governing board of the entity is responsible to the Minister (usually through the chair), recognising that elements of this will depend on the category of entity concerned;
- the entity's chief executive is responsible to the board; and
- the staff of the entity are responsible to the chief executive.
Crown entity board members need to clearly understand the different roles, responsibilities and accountabilities of each party. This will facilitate the establishment and maintenance of mutually constructive and positive working relationships.
Relationship with Ministers
The role of the responsible Minister is to oversee and manage the Crown's interest in, and relationship with, the entity, and to exercise any statutory responsibilities.
Under s. 27 of the CE Act, Ministers have functions and powers with regard to all entities on the appointment and removal of members, matters of strategic direction and targets, operations and performance, reporting and reviews. The Minister needs to exercise these powers in a way that recognises any statutorily independent functions.
Under s. 133 of the CE Act, the Minister has the power to request information:
- The board of a Crown entity must supply to its responsible Minister any information relating to the operations and performance of the Crown entity that the Minister requests.
- The board of a Crown entity must supply to the Minister of Finance any information requested by the Minister in connection with the exercise of his or her powers under Part 4 of the CE Act.
- The board of a Crown entity must supply the Minister of State Services any information requested by the Minister, where that information is requested for the purpose of assessing the capability and performance of the State services, and the request is made to a group of at least 3 entities that have in common at least 1 significant characteristic that relates to the information requested.
- Section 133 is subject to s.134 of the CE Act. Section 134 provides certain grounds for refusing to supply information requested by a Minister, for example, to protect the privacy of a person. However the reason must outweigh the Minister's need to have the information in order for the Minister to discharge ministerial duties.
The Minister is responsible to the House of Representatives for overseeing and managing the Crown's interests in, and relationships with, the entity. The Minister is politically answerable on a day to day basis in connection with the entity. This can include responding to questions, and participating in debates and reviews. The Minister also tables in the House an entity's statement of intent and annual report and appears before select committees where the Minister may be asked to comment on an entity's activities. However, the entity itself is also accountable to the House of Representatives for its own actions (see Chapter 15: Planning and reporting).