Rachel Siewert (WA, Australian Greens) Share this | Hansard source

The Greens will be opposing the Australian Broadcasting Corporation Amendment Bill 2006. If you look at the committee that inquired into this bill, you will find 55 submissions—53 opposed the bill and two were neutral. When you look at the government’s rationale for this bill as expressed in this place on 29 March, you will find that Senator Minchin argued:

... a staff-elected Director is uncommon amongst Australian Government agency boards.

He said it is not consistent with modern principles of corporate governance, creates tensions on the ABC board and creates an expectation that a staff-elected director will be expected by the constituents who elect him or her to put their interests ahead of those of the ABC where they are in conflict. He also referred to the findings of the Uhrig review in relation to representational appointments to governing boards and stated:

There is a clear legal requirement on the staff-elected Director that means he or she has the same rights and duties as the other Directors, which includes acting in the interests of the ABC as a whole.

In arguing the response of the Australian Greens to this bill, I will address each of the following in turn: the alleged uncommonness of the role and its supposed inconsistency with modern governance; the creation of so-called tension on the board and the so-called expectations of constituents and whether this creates a conflict of interest; and the relevance of the findings of the Uhrig report on the issue of whether the board position is representational. Then I will talk about the independence of the ABC.

Firstly, I would like to look at existing legal requirements. There is already a legal requirement for board members to act in the best interests of the ABC, which is backed up by civil penalties. The Commonwealth Authorities and Companies Act 1997, the CAC Act, requires board members to:

... make the judgment in good faith for a proper purpose and does not have material personal interest in the subject matter of the judgment and informs himself or herself about the subject matter of the judgment to the extent that he or he reasonably believes to be appropriate and rationally believes that the judgment is in the best interests of the Commonwealth authority.

No evidence was presented to the inquiry or in this place that the staff-elected director ever acted contrary to these requirements, and if the government had such evidence they should act upon it—in other words, they should put their money where their mouth is. We believe that these civil penalties are sufficient to deal with any inappropriate behaviour by the staff-elected director should it arise. I would like to point out that we do not think it has ever arisen, but that the government has the power to take action as it is.

Is their argument that there is a public perception of bias? I think the argument is that there is a public perception of bias by the appointees from the government. Is this consistent with other practices? I would like to look at the statement about it being uncommon among Australian government agency boards and that it is not consistent with modern principles of corporate governance. A number of submissions presented evidence to the inquiry that staff-elected or stakeholder-nominated board members are consistent with practice elsewhere, including public companies, universities, some government statutory authorities, and exclusive private schools. There is the ANU—also Oxford and Cambridge—the Australian Institute of Health and Welfare, Mercedes Benz, the film schools, Canberra Girls Grammar, the fishing industry, Australia Post, Defence Housing Authority and the Australian Fisheries Management Authority. All of these also seem to be travelling quite well with stakeholder representation.

Employee participation is arguably a well-established principle of good management, and many Australian government boards go to great lengths to ensure industry participation. Why not other participation? There is a wide diversity of practice in corporate governance. In fact, Uhrig stated:

It is not surprising that there is no universally agreed definition of corporate governance, just as there are no universally accepted structures and practices that constitute good governance.

We would argue that there are no precedents for removing this position and that good governance depends on how the board runs and what the requirements are of the company or structure that that board is managing. As Uhrig points out, there is no standard form for good governance. We argue that the current staff-elected director position is in fact essential to running an organisation of the nature of the ABC.

The Uhrig review was very specific to the areas of taxation regulation and the provision of services in response to complaints about the ACCC and the ATO treating big businesses unfairly. The ABC is a completely different class of statutory authority to those examined by Uhrig. The terms of reference of the Uhrig review were concerned with regulatory and service delivery authorities. In Uhrig’s own words, the review was very ‘practical’ in focus, and its key findings stem from ‘the outcome of consultations with key participants’. Neither the ABC nor any other federally legislated bodies with elected directors were considered or consulted. It is inappropriate to stretch its findings to the ABC.

Uhrig carefully qualified his findings and made it clear he was referring to the problems caused by representational appointments, not elected ones: in the private sector in relation to representatives of a parent company to the board of a subsidiary and in the public sector in relation to the appointment of public servants as departmental or government representatives. It is misleading to equate and confuse Uhrig’s comments and examples of representational appointments with the issue of stakeholder directorships. The election of a stakeholder position does not equate with a representational role.

That leads us on to the question of whether this is a representative role. The evidence presented by a range of stakeholders, including current and former staff-elected directors, made it very clear that the role is not seen as representational. Numerous examples were presented of situations where the staff-elected director had put the best interests of the ABC ahead of those of the staff, for example in the Telstra deal. When we questioned all the staff-elected directors who appeared before the committee during the inquiry, it was very clear that they knew what their obligations were and that they had acted in the best interests of the ABC at all times. This was backed up, as I said, by communications from the staff-elected directors to the ABC staff, which clearly spelt out that the role is not representational.

The Australian Broadcasting Corporation Act 1983, the ABC Act, made it very clear that the staff-elected director has no role to represent the interests of ABC employees to the board. The minister’s talk of expectations of constituents is particularly misleading in this context, and this is remarked upon in the dissenting report from the Labor Party, the Democrats and the Greens. We also made a comment about the attack on Ms Koval which appears in the majority report. It is extremely disappointing that the majority report criticises Ms Koval, particularly about her refusal to sign the ABC board protocol. In fact that refusal clearly demonstrated her independence, and she clearly outlined the reasons why she did not feel it was appropriate to sign the protocol.

That takes me on to the issue of conflict of interest. Evidence to the committee contradicted this claim. All previous staff-elected directors stated that the role is not a representational one and that they had been at pains to exercise their independence and to communicate this to ABC employees. No examples of particular conflicts of interest were presented. There is a requirement for all board members to declare any potential conflict of interest. This is good governance and this is a requirement for all members of the ABC board.

The issue of tension was also raised. It was claimed that having a staff-elected director on the board would cause tension. You would expect tension on any good governance board. Surely directors are never of one single mind, in any circumstances. Surely, as long as the interests of the ABC are put first and any conflicts of interest are declared, some tension between board members who have different ideas and are willing to discuss them is in fact in the best interests of the corporation. Having dynamic tension is creative. I do not believe that having a staff-elected director is any different from having anybody else on the board with a difference of opinion. Different perspectives encourage creativity and healthy debate.

Now I would like to talk quickly about the reasons for having a staff-elected director. Having argued why we believe that there is no problem with conflict of interest with the role and why existing legal requirements and civil penalties are sufficient to deal with any past or future inappropriate behaviour, I would like to look at the positive sides of having a staff-elected director.

The duties of the ABC board, as has been articulated before, are to ensure that the corporation output is of maximum benefit to the people of Australia, to maintain the independence and integrity of the ABC and to benchmark the accuracy and impartiality of news and information presentation by the recognised standards of objective journalism. The ABC is statutorily required to provide broadcasting services which are innovative and comprehensive, contribute to a sense of Australian identity and are entertaining, informative and educational. It is also required to encourage the performing arts in Australia and encourage awareness of Australia and Australian affairs within and outside Australia.

The point is that the requirements of the public broadcaster, as I have just articulated in terms of program quality and statutory requirements, are very different from those of a commercial broadcaster. Producing quality broadcasting is heavily reliant on the particular knowledge and skills of the ABC staff and their commitment to the ABC’s mission. The ABC must foster its creative human resources and monitor the breadth and quality of its output. It needs to ensure that there is broadcasting experience, particularly public broadcasting experience, on the board. Previous staff-elected directors have been experienced broadcasters who have brought valuable insights into policy issues and have been frequently called on by the board to share their experience. Kirsten Garrett, a former staff-elected director, said:

It is rare for other directors have a working knowledge of the dynamics of journalism or program making.

I would like now to turn to independence from political interference. Recent appointments have been blatantly political. The loss of a staff-elected director means that the actions of the ABC management are likely to receive less scrutiny. We need a position on the board which is beyond government’s capacity to influence or control. There is a strong public perception that this bill represents an ideologically motivated attack on the ABC. The ABC has been chronically underfunded for years. ABC historian Professor Inglis has said:

The ABC is bound to broadcast information and opinion useful and harmful to people in public life. More particularly, the ABC accommodates criticisms, sometimes severe, of the government on which it depends for revenue, and that is bound to be a rich source of conflict.

It is absolutely essential that we have independent people on the ABC board, and the only way at the moment that we can as a nation ensure that is by having a staff-elected director. That staff-elected director is at least one person who has shown independence, who has been willing to stand up and ensure that the charter of the ABC is maintained.

The Greens are deeply concerned that there is a real risk that the strength of ABC Online and the incredible diversity of its content will result in a push for the ABC board to enter into commercial agreements with such things as search engines, for example, or some other online provider and to more generally go down the line of commercial exploitation of the ABC’s content. We are deeply concerned that this commercial exploitation will further push and ignore the charter of the ABC. A number of us are deeply concerned about the commercialisation that has taken place at SBS and that the SBS charter has been further marginalised. We are deeply concerned that, with the loss of the staff-elected director, the ABC will be pursuing this line.

We believe that the process for appointments to the ABC board needs to be open and transparent. As was articulated in the dissenting report:

There should be an open and transparent process for making appointments to the ABC board. Vacancies should be advertised and there should be clear merit-based selection criteria.

An independent selection panel should conduct the shortlist selection process.

If the Minister does not appoint a short-listed candidate he or she should be required to table in Parliament a formal statement of the reasons for departing from the shortlist.

We heard overwhelmingly in the committee that it is a bad idea to take away the staff-elected director position. We will oppose this legislation. We believe it is really about making the ABC less independent. We urge the government not only to reconsider this position but also to put in place a much more open and transparent process to make our ABC really independent and to maintain the quality that we believe is essential and which all Australia is looking for from the ABC.