Governance News 30 January 2019

60 minute read (PDF download)  29.01.2019 Mark Standen, Siobhan Doherty, Kate Hilder

Governance News provides weekly summaries of key regulatory and governance developments in Australia and overseas. Among other things, this week's issue includes coverage of MinterEllison's AGM trends report which provides a snapshot of ESG and remuneration trends at Australia's largest companies over the past three years.

Full coverage of this weeks content is now available

Past issues are available

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We provide weekly summaries of key regulatory and governance developments in Australia and overseas.

Boards and directors Navigation Show below Hide below

  • The Renault board has announced a new leadership team and flagged governance changes at the company

Diversity Navigation Show below Hide below

  • No need for gender quotas?  The 30% female board representation target has almost been reached with women accounting for 29.7% of board positions on ASX200 boards according to AICD figures
  • United States | (Gender) diversity remains an issue on US boards?  An Equilar study into gender diversity on Russell 3000 boards has found the average number of female directors is less than two 
  • World Economic Forum | A long way to go on (gender) diversity? There is reportedly a measure of consensus on the need to accelerate progress on the issue, but less agreement on how that can best be achieved The AFR reports

Shareholder activism Navigation Show below Hide below

  • Recent developments in activist campaigns: Elliott and Starboard at eBay, Third Point at Nestle 

Meetings and proxy advisers Navigation Show below Hide below

  • Top Story | Key Trends to emerge from the 2016-2018 AGM Seasons

Regulators Navigation Show below Hide below

  • APRA has released an information paper outlining its own assessment of various measures it implemented to lift home lending standards: 'Overall, APRA views the measures as having achieved their objectives without undue unintended consequences' though they did 'also involved trade-offs for the community' APRA writes
  • United Kingdom | The Financial Conduct Authority is consulting on proposed guidance on crypto-assets and the circumstances in which crypto-assets fall within the FCA's regulatory remit
  • In Brief | The Australian Securities and Investments Commission (ASIC) has reportedly been found (based on a record of the gifts it has received from 2014-2017) to be accepting a range of gifts from the institutions it regulates.  Reportedly the regulator has declined to release the gift register for 2018 and has said it is undertaking a review of its policy in relation to gifts

Financial Services Navigation Show below Hide below

  • Timing confirmed: The Financial Services Royal Commission final report will be publicly released 4:10pm on Monday 4 February 
  • Open Banking update | 'Safety of customer's data should be a key priority' in Open Banking: The Australian Banking Association's (ABA) advocates a stronger focus on privacy protections 
  • The Financial Services Council has extended the consultation deadline on the FSC Life Insurance Code of Practice to 31 January
  • Buy now pay later update | The Australian reports that ASIC is of the view that proposed product intervention powers may be sufficient to address the risk of consumer detriment in the sector (at least for now)
  • In Brief | Rice Warner has questioned the evidential basis of certain recommendations in the Productivity Commission's superannuation report.  'The link between the PC’s recommendations and its earlier analysis has become increasingly tenuous as the inquiry progressed' Rice Warner writes
  • In Brief | AUSTRAC guidance for the superannuation sector: In response to requests from the superannuation sector, AUSTRAC recently released industry specific guidance on compliance with obligations under the AML/CTF legislation.  The guidance focuses on specific risks and potential scenarios relating to money laundering (ML) and terrorism financing (TF) and financial crime specific to superannuation entities. It also gives examples of methods that can be used to mitigate these risks and combat criminal threats

Accounting and audit Navigation Show below Hide below

  • ASIC audit inspection findings 2017-2018 released: A focus on culture and talent will be required to accomplish 'sustainable improvements' in audit quality ASIC writes
  • ASIC has announced the findings from 30 June 2018 Financial Reports: 'ASIC’s concerns continue to relate to impairment of non-financial assets and inappropriate accounting treatments' 
  • United Kingdom | Broader implications? The Chair of the BEIS committee has said that the recent collapse of Patisserie Valerie raises questions about the effectiveness of current regulatory settings for the audit sector

Risk management Navigation Show below Hide below

Supply Chain Risk

  • United Kingdom | Review of the UK Modern Slavery legislation has recommended the government legislate penalties to drive compliance

Brexit

  • (Possible) no-deal Brexit impact? A number of UK based businesses have reportedly cautioned lawmakers that a 'no deal' Brexit could result in UK job losses, disruption to food supply and the relocation of businesses 

Cybersecurity and Privacy

  • Recent developments: data privacy, data stewardship and the need (or not) for increased regulation of technology and large technology companies

Other Developments

  • ALRC report calls for an inquiry into the laws underlying shareholder class actions
  • The US Department of Justice has announced it has brought criminal charges against Huawei and others for (alleged) financial fraud
  • In Brief | AUSTRAC has issued a reminder that the deadline for submission of annual compliance reports (on how entities have met their anti-money laundering and counter-terrorism financing obligations over the 2018 calendar year) is 31 March.  

Other news Navigation Show below Hide below

  • Plans to strengthen UCT protections for SMEs? If elected, the Federal Labor party plans to make unfair contract terms illegal, to introduce penalties and increase the number of small businesses eligible for protection

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https://www.minterellison.com/articles/governance-news-30-january-2019