This is a service specifically targeted at the needs of busy non-executive directors. We aim to give you a “heads up” on the things that matter for NEDs in the week ahead – all in two minutes or less.  

In this Edition, we examine the Governance Institute of Australia’s Board Diversity Index for 2021, ASIC’s recent quarterly update, actions and proceedings, and its findings following the first round of reviews of super fund annual members’ meetings. We also consider registration risks facing charities and the Treasury’s consultation on the potential automatic moratorium on creditor claims in schemes of arrangement.

This week’s Over the Horizon discusses the Treasury’s Economic Impact Analysis of the Federal Government’s National Plan to Transition to Australia’s National COVID-19 Response.


Governance Institute of Australia publishes its Board Diversity Index for 2021. In last week’s edition of Boardroom Brief, we noted the publication of an independent report identifying Australia as one of three countries to have reached 30% female representation on boards voluntarily. Now, the Governance Institute of Australia has published its Board Diversity Index for 2021 which affirms that gender representation on boards has improved significantly in recent years. The report, which examined 300 organisations and more than 2000 board seats, found there was an almost 60% increase in the number of board seats occupied by women in the last five years, and that boards with no women have decreased from 59 in 2016 to 14 in 2021. However, while gender equality is moving in the right direction, the report notes that improvement in cultural diversity is “moderate at best” and that “based on current trends, it will take 18 years for the boardroom to be reflective of Australia’s cultural diversity”. As the report notes, investors and shareholders are increasing pressure on boards to be more reflective of the community in which they operate.

ASIC releases quarterly update April to June 2021. ASIC has published its quarterly update for April to June 2021. The report notes ASIC has focused on economic recovery from the impact of COVID-19, including by extending deadlines for lodgement of financial reports for listed and unlisted entities and extending the “no action” position on annual general meetings held out of time.  ASIC has also aimed to strengthen market integrity by, among other things, implementing penalties for misconduct (notably, including a private company’s payment of a $20 million penalty for engaging in “systemic unconscionable conduct”, discussed in a previous edition of Boardroom Brief), releasing information on activist short selling and banning the sale of binary options to retail clients. See ASIC’s media release.

ASIC releases findings following its first round of reviews of super fund annual members’ meetings.  The Treasury Laws Amendment (Improving Accountability and Member Outcomes in Superannuation Measures No. 1) Act 2019 introduced the requirement for superannuation trustees to hold annual members’ meetings, and ASIC will review those meetings.  ASIC representatives sat in on meetings held by superannuation funds (ranging from industry, retail, corporate and public sector funds) from October 2020 to March 2021, and focused its review on whether trustees met attendance requirements, published minutes of the meeting (including answers to members’ questions) and provided a reasonable opportunity for members to ask questions.  ASIC notes it did not identify any significant failures by the funds to comply with the above requirements, however it did identify room for improvement in trustees’ communications to members and the ways in which they provide opportunities for questions at these meetings.  ASIC also notes that the key themes of questions raised by members related to cybercrime, ESG considerations, fund performance and fees and the impact of COVID-19.  The first two items in this list remind funds and companies that members and shareholders are increasingly concerned with what entities are doing beyond providing positive financial returns.  See ASIC’s media release.

ASIC takes action for companies failing to comply with financial reporting obligations. ASIC has released a media release noting it has prosecuted ten companies between 1 January 2021 and 30 June 2021 for failing to comply with their obligations to lodge financial reports.  The penalties included fines of up to $12,000 and companies being placed on bonds and ‘good behaviour’ orders. 

Australian Charities and Not-for-profits Commission flags charities are at risk of losing registration.  The Australian Charities and Not-for-profits Commission (ACNC) has reported that hundreds of charities are at risk of losing their ACNC charity registration as they have failed to submit two or more Annual Information Statements.  ACNC Commissioner, Dr Gary Johns has stated those responsible for running charities (such as Boards or committee members) must make it a priority to comply with these crucial reporting obligations.  Once a charity’s registration is revoked, it will no longer receive Commonwealth charity tax concessions or other benefits as a registered charity.  See ACNC’s media release.


Treasury consults on the potential automatic moratorium on creditor claims in schemes of arrangement.  On 2 August 2021, the Treasury announced that the Federal Government is seeking stakeholder input on the appropriateness and impact of applying an automatic moratorium on creditor claims during the formulation of a creditors’ scheme of arrangement.  Currently, no such automatic moratorium is applied.  The Productivity Commission has separately found that an automatic moratorium may enhance the utility of schemes by allowing companies and their creditors breathing space to formulate and effect the scheme.  The consultation is part of wider reforms being considered to facilitate the successful restructuring of companies, including those impacted by COVID-19.  See the Treasury’s consultation page.


In last week’s edition of Boardroom Brief, we noted the announcement of the National Cabinet’s updated four-step National Plan to transition Australia’s National COVID-19 Response (National Plan). Now, Treasury has published its Economic Impact Analysis, which estimates the direct economic costs of the COVID-19 management strategies modelled by the Doherty Institute, which contributed to the development of the National Plan. Treasury reached four key conclusions. First, it is more cost effective to manage the COVID-19 Delta variant by maintaining a minimising strategy and a “Track, Trace, Isolate and Quarantine” strategy. Second, it is more cost effective to apply strict localised lockdowns for shorter durations than applying moderate lockdowns for longer periods. Third, the direct economic costs of managing the virus decline sharply as the vaccine is rolled out, regardless of the strategy adopted. Finally, under a minimisation strategy, once vaccination rates reach 70 per cent, lockdowns are unlikely to be required, which will significantly reduce the economic cost of managing COVID-19. It therefore appears that if vaccination targets are reached by the end of the year and states continue with strict lockdowns, the nation may be on track for economic recovery. However, whether the vaccination targets will be achieved remains to be seen.  

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