Today we have a guest post by Scott Long from Melbourne. Scott has been a long time contributor to Domainer and auDA.
Is auDA Practising What It Preaches? – Scott Long; Author
In auDA’s 2020 Annual Report, they affirmed that ASX (Australian Stock Exchange) principles are important to them as an organisation.
The Corporate Governance Principles and Recommendations issued by the ASX (the CGPR) set out a contemporary view of appropriate corporate governance standards that are relevant not only to the ASX listed public entities that are required to report against them, but to all corporations interested in good governance practices.
Today, I look at just one of these ASX Governance principles (otherwise this article would be SO long).
In my opinion, auDA are failing their Members when it comes to remuneration transparency and accountability.
e.g – Principle 8 of the ASX Corporate Governance Council Principles and Recommendations (the Principles) require that companies comply or explain their “Remuneration Fairly and Responsibly”.
“A listed entity should separately disclose its policies and practices regarding the remuneration of non-executive directors and the remuneration of executive directors and other senior executives“.
So What Does auDA Do?
It gives bonuses to Senior Executives, and covers these off with a simple two-line sentence in the October Board Minutes (Item 8):
The Board resolved, on the recommendation of the People & Culture Committee, to accept the CEO’s proposal for Senior Executive Bonus Payments.
- Good one auDA! How much? Who to? Why?
- What KPI’s were achieved to get bonus payments?
- Surely growth in executive remuneration can only be justified by a corresponding growth in the performance of the company?
- Given that auDA is primarily a membership organisation – and also responsible to many stakeholders – surely this information should be public?
Unlike ASX listed entities, auDA has an Associate membership structure which does not allow its members to vote on executive and auditor’s remuneration – or to hold the Board accountable on any relevant matter. That is absurd.
In light of this absurdity, auDA flaunts the ASX principles like it’s the new vanguard of NFP corporate governance, but stops short in disclosing important matters. E.g; applying ASX principles and the Corporations Act, Section 250R(2) which requires a resolution at the AGM that the remuneration report must be put to the vote.
Then there is the “Pub Test”
As Australian Chamber of Commerce and Industry head James Pearson recently said:
At a time when many Australians are out of a job and many people in business are hanging on hoping for restrictions to ease and customers to come back, pay rises for public sector executives don’t pass the pub test.
Nominet is the UK regulator of domain names, and as you can see, it is very transparent and accountable when it comes to declaring income. The big question is why can’t auDA be the same?
In terms of accountability and transparency, it’s important to remember that the majority of auDA’s revenue comes from its stakeholders – particularly registrants of Australian domain names.
Surely we have a right to know how you spend our money?