Governance News 30 August 2023

60 minute read + (PDF download) 30.08.2023 Mark Standen, Siobhan Doherty, Kate Hilder

Risk management including management of climate risk, cyber risk and broader operational risks is the theme of this issue. We cover the release of APRA and ASIC's latest corporate plans and APRA's expectations around how organisations should approach implementation of CPS 230 and more…

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Snapshot of S&P 500 board composition
The proportion of CEO roles held by women is slowly increasing in companies listed on major stock indicies, but gender parity is still in the far distance (at the current rate of progress)
Equal Pay Day: WGEA urges employers to act to close the persistent gender pay gap

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UK Executive Remuneration | FTSE 100 CEO pay rises to five year high
Health insurer slashes bonuses following cyber attack

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'So many proposals were over-reaching, lacking economic merit, or simply redundant': BlackRock's support for shareholder E&S proposals has dropped significantly
US proxy season: Vanguard-advised funds' support for shareholder E&S proposals dips to 2%
Funding nature repair: Australia to host first global nature-positive summit
No entity 'at risk of not meeting' mandatory disclosure requirements: RBNZ releases results of second industry survey on climate-related risk management and disclosure
Net zero at risk? UK investors call for 'long term policy certainty' on green transition
NZAOA opens consultation on a fourth edition of its target setting protocol
IAASB consultation on draft global sustainability assurance standard: New stakeholder survey released
In Brief | A blueprint for collaboration with government on climate: The IGCC has released an action plan covering the period September 2023 to December 2025, outlining the four key objectives it will undertake to 'stimulate investment in' and 'drive economy-wide adaption and resilience to the physical damages and disruption of climate change'. It's hoped that IGCC members will 'adapt this strategy, take ownership of it and look for practical ways to implement and improve it' within their own organisations
In Brief | Intergenerational Report 2023 released: The report identities climate change and the net zero transformation as one of five major trends that will shape the Australian economy over the coming decades. As well as flagging the potential climate impacts on labour productivity, crop yields, tourism and natural disasters the report also flags opportunities flowing from the energy transition eg opportunities for the critical minerals sector to 'scale up' to meet anticipated demand
In Brief | International disclosure standards for human capital and human rights issues should be top of the ISSB's agenda: A 24 strong investor coalition managing one trillion USD+ (led by ShareAction) has urged the ISSB to prioritise researching human capital and human rights disclosure standards in its upcoming two-year work plan
In Brief | ISS analysis highlights that shareholder proposals calling for an independent board chair spiked 113% in H1 2023 across the Russell 3000. To put this in context, this means that one in four S&P 500 companies chaired by a non-independent director received a shareholder proposal calling for change. Interestingly, the increase in volume of proposals was not matched by an increase in support – according to ISS support has remained steady (between 29-35%) over the past ten years – though despite this, combined Chair and CEO roles are becoming steadily less common (less than 50%) across all US indices

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CHESS replacement: RBA and ASIC issue joint letter of expectations to ASX

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Leadership changes announced at ASIC

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Top Story | Operational risk, cyber risk and climate risk flagged as key areas of focus in APRA's latest Corporate Plan
CPS 230 implementation: APRA says it wants to 'light a fire' under organisations when it comes to managing operational risk
Top Story | Supply Chain Cyber Risk Management Best Practice Guidelines
Top Story | Consumer protection is again the key theme in ASIC's latest corporate plan
Top Story | Results of ASIC review of general insurance TMDs
ASIC has written to 30 large lenders calling on them to ensure they 'appropriately support customers experiencing financial hardship'
In Brief | Ensuring insurers deliver on their pricing promises: ASIC has taken court action over an insurers' (alleged) failure to deliver on home contents insurance pricing promises – in essence, ASIC alleges that the insurer 'misled' customers about the extent of the 'loyalty discount' they would receive. This is the latest enforcement action by the regulator over pricing issues – responding to failures to deliver on pricing promises is one of ASIC's enforcement priorities
In Brief | Appearing before the inquiry into promoting economic dynamism, competition and business formation, former ASIC and IOSCO Chair Greg Medcraft underlined 'the need for a more competitive banking system'. Mr Medcraft suggested that 'the key to securing this is a public residential mortgage-backed security scheme [for example, of the kind in place in Canada], which would reshape competition in the Australian residential lending market'

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Government launches two year review of competition policy settings
How to fix Australia's whistleblowing laws: Human Rights Law Centre reiterates calls to strengthen protections for whistleblowers

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MBR Program scrapped following independent review
Independent Review of the Franchising Code of Conduct: Consultation paper released

Contact

Mark Standen

Consultant, Sydney
- +61 2 9921 4902
- +61 412 104 902
Siobhan Doherty

Partner, Sydney
- +61 2 9921 4339
- +61 413 187 544

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Governance News 30 August 2023

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