Effective 1 July 2022
Introduction
CSIRO is a body corporate constituted and operating under the Science and Industry Research Act 1949 (SIR Act) and a corporate Commonwealth entity operating under the Public Governance, Performance and Accountability Act 2013 (PGPA Act) .
The main purpose of this instrument is to set out the formal directions given by the Board of CSIRO to the Chief Executive of CSIRO under the SIR Act.
The directions are also intended to harmonise the requirements of the SIR Act and the PGPA Act so that CSIRO will be governed seamlessly and be fully compliant with the requirements of both Acts.
Roles of Board and Chief Executive
The Board is responsible to the Commonwealth Government for the overall strategy, governance and performance of CSIRO. The functions of the Board are:
- to ensure the proper and efficient performance of the functions of the Organisation
- to determine the policy of the Organisation with respect to any matter
- to give directions to the Chief Executive; and
- such other functions as are conferred on it by the SIR Act 1949.
The Board has the power to do all things necessary or convenient to be done for, or in connection with, the performance of its functions [SIR Act s12].
The Board, as the accountable authority for CSIRO, also has a range of duties under the PGPA Act.
The Board has articulated how it will fulfil its functions and duties in more detail in the CSIRO Board Charter and Board Governance Document.
The SIR Act specifies that the affairs of CSIRO shall be conducted by the Chief Executive subject to any policies determined by the Board and any directions given to the Chief Executive by the Board [SIR Act s10A].
The Board works with and through the Chief Executive of CSIRO to ensure the Organisation fulfils its functions.
The Chief Executive is responsible to the Board for the overall development of strategy, management and performance of CSIRO. The Chief Executive manages the Organisation in accordance with the strategy, plans and policies approved by the Board to achieve the Organisation's objectives.
Directions to the Chief Executive
By a resolution of the Board of Commonwealth Scientific and Industrial Research Organisation (CSIRO) dated 1 July 2018, pursuant to subsection 10A(3) and paragraph (1c) of section 12 of the Science and Industry Research Act 1949 [SIR Act], the following directions were given to the Chief Executive of CSIRO. The directions remain in force until amended or revoked by the Board of CSIRO.
The Chief Executive of CSIRO must:
1 General
1.1 Assist the Role of the Board
(a) Assist the Board and its committees to fulfil the functions and duties of the Board and their respective Charters by:
- providing high quality management reports, discussion papers and proposals as required, including on the focus areas identified from time to time by the Board and those needed for the annual programs of work (Forward Planner) set by the Board and its committees
- ensuring matters presented to the Board for decision are supported by reliable and competent information and advice so the Board may exercise due diligence and care [PGPA Act s25] and make decisions in the best interest of CSIRO
- provide timely information to the Board of possible events and changes that might affect the direction and operations of the Organisation including emerging risks and opportunities
- reporting regularly against the strategies and plans approved by the Board, including the Corporate Plan, and performance measures, to ensure that the Board and its committees are kept properly informed about progress and promptly advised of any departures from plans or policies; and
- ·offering proposals for improvement in Board operations and the working relationship with management.
(b) Facilitate communication between Board Members, Board Committee members, senior managers of CSIRO and the internal and external auditors of CSIRO in order to promote good governance, with particular reference to the duties of the Board under the PGPA Act.
1.2 Governance
(c) With the Board, govern CSIRO in a way that:
- promotes the proper use and management of public resources for which CSIRO is responsible
- promotes the achievement of the purposes of CSIRO (i.e., the functions of CSIRO in the SIR Act s9)
- promotes the financial sustainability of CSIRO; and
- promotes the health and safety of CSIRO staff, visitors and affiliates.
In making decisions in relation to (i to iii), take into account the effect of those decisions on public resources generally [PGPA Act s 15].
When enacting decisions approved by the Board, ensure those decisions align with the Board’s agreed position.
Proper, when used in relation to the use or management of public resources, means efficient, effective, economical and ethical.
1.3 Personal duties
(d) Give written notice to the Board of all direct or indirect pecuniary interests the Chief Executive has or may have in any business or in any body corporate carrying on a business [SIR Act s10F] and notice of any material personal interest in a matter that relates to the affairs of CSIRO [PGPA Act s29]. This may include a standing notice of the nature and extent of the interest.
2. Direction
2.1 Strategy development and implementation
(a) In close consultation with the Board, prepare and submit for consideration and approval by the Board a draft Corporate Plan [PGPA Act s35] for an agreed planning period setting out:
- the objectives of CSIRO in performing its functions
- an outline of the policies and strategies to be pursued by CSIRO to achieve those objectives
- the activities CSIRO proposes to carry out; and
- the resources CSIRO proposes to allocate to each such activity
The plan must cover CSIRO and any subsidiaries. [PGPA Act s35(5)].
(b) Ensure the Corporate Plan sets out how the activities of CSIRO will contribute to achieving the key priorities and objectives of the Australian Government as related to the purpose of CSIRO; and ensure the Plan complies with the prescribed Rules [PGPA Act s34 & s 35].
(c) Give the Corporate Plan to the responsible Minister and the finance minister, following approval by the Board, in accordance with the prescribed Rules [PGPA Act s35(1)(b)].
(d) Ensure the strategy and operations of CSIRO are informed by effective advisory mechanisms and when issued, by the Ministerial Statement of Expectations for CSIRO.
(e) Encourage CSIRO leaders to cooperate with others to achieve common objectives, where practicable [PGPA Act s 17]; and ensure CSIRO cooperates with other organisations [SIR Act s10] in the coordination of scientific research, with a view to:
- the prevention of unnecessary overlapping; and
- the most effective use of available facilities, collections and staff.
(f) Conduct an annual review of the approved Corporate Plan with the Board.
(g) Ensure the effective governance, communication and delivery of the approved Corporate Plan.
(h) Submit more detailed strategies and investment proposals to support delivery of the Corporate Plan to the Board for advice, endorsement or approval as appropriate. This includes all matters which would have a material impact on the Organisation.
Material matters include matters involving a major, long-term research, relationship or financial commitment; a major change in CSIRO's research priorities and capacity; high enterprise level residual risk; and matters potentially outside of the policies and strategies of the Board. Examples include industry and international strategies, new policy proposals to the Government and internal portfolio investment cases.
2.2 Resource allocation and efficient use of public resources
(i) Prepare budget estimates for approval by the Board for each reporting period, and for any other periods directed by the finance minister and give the estimates to the Finance Secretary in accordance with their written directions, once approved by the Board [PGPA Act s36(1)].
(j) Ensure the budget estimates fairly present the estimated financial impacts of CSIRO's activities for the reporting period or other period and comply with Finance Secretary Directions [PGPA Act s36(2)].
(k) When imposing requirements on others in relation to the use or management of public resources for which CSIRO is responsible, take into account:
- the risks associated with that use or management; and
- the effects of imposing those requirements [PGPA Act s 18].
3. Transformation
3.1 Operations
(a) Ensure CSIRO has an effective Operating Model that:
- adopts best practice relevant to organisation of CSIRO’s type
- embeds performance related metrics
- delivers sustainable efficient, effective and timely business operations and services
- supports a positive culture and clear direction
- strengthens stakeholder, customer and market focus
- is fit for service with sufficient flexibility for a dynamic environment
- provides for security of the Organisation's human, physical and virtual assets
- incorporates a continuous improvement program; and
- supports the execution of CSIRO’s Strategy.
(b) Ensure the Board is consulted on:
- ·organisational structure, including the senior executive structure immediately below the Chief Executive, the portfolio responsibilities of members of the Executive Team, and the structure of business units
- selection of people to fill these positions and the overall balance of the Executive Team including skill mix and diversity; and
- succession planning for senior executive positions.
3.2 Capability
(c) Ensure that CSIRO's organisational capability:
- delivers world class scientific research and delivers valued impacts for our customers.
- incorporates mechanisms to reward and recognise our scientists where world class impacts are delivered
- supports the acceleration of our overall rates of international engagement, operations and collaboration where there is a higher potential impact value return to Australia than available domestically; and
- is maintained and enhanced through programs that attract and cultivate diverse and world-class staff, retains the right people, and plans for succession.
(d) Ensure a cohesive, healthy and safe working environment in which teamwork, inclusion, trust, creativity and innovation flourish; and in which staff are treated with equity and respect, act with integrity, honesty and openness, and may contribute effectively to the achievement of CSIRO's purpose and objectives
(e) Ensure staff consultation, in accordance with the Enterprise Agreement, and through the Consultative Council [SIR Act s56]
(f) Encourage and foster effective communication processes.
3.3 Risk
(g) Establish and maintain an organisational risk framework that facilitates the identification and management of strategic, operational and external risk [PGPA Act s 16(a)] to a level commensurate with CSIRO's risk appetite and is supported by plans and reporting systems to confirm their efficiency and effectiveness. The framework should identify, at a minimum, risks associated with:
i. the brand and reputation of the organisation.
ii. customer delivery through science, collaboration and innovation including a recognition that the risk of failure is inherently high in undertaking challenging science, however actions that compromise scientific integrity, impartiality and independence are unacceptable.
iii. people, health, safety and environment recognizing that in pursuing our science we undertake many activities with a high inherent risk relating to health, safety and the environment but these risks must be managed to an aspiration of zero harm. There is no tolerance for actions that endanger the safety of our people.
iv. commercial and financial risks that imperil a long term sustainable financial position whilst recognising that Strategy 2020 and the dynamic global environment in which CSIRO operates demands engagement with new commercial business models and approaches in a global context.
v. governance and compliance risk that conflict with the objective of consistently demonstrating accountable, transparent, inclusive and informed decision making.
vi. Innovation through resilient strategies to solve the big problems facing Australia within the context of maintaining good governance and learning from failure.
vii. Our high public profile combined with the strategic necessity and attendant advantages of being closely aligned to areas of policy contention, while maintaining our trusted advisor positioning and close adherence to our public comment policy.
In addition, the framework should explicitly address organisational resilience and the processes and practices in place to identify, mitigate and, when required, respond to the myriad of threats that inevitably arise in a large, multi-faceted and geographically diverse organisation.
The risk framework is to be reviewed annually and presented to the Board for confirmation.
3.4 Policies
(h) Formulate for Board approval a Policy Framework and the policies necessary to ensure that CSIRO achieves its objectives and complies with all applicable laws and Government policies and directives.
(i) Maintain a complementary set of more detailed standards, procedures and guidelines to be approved by the Chief Executive or Senior Managers in accordance with the Policy Framework.
(j) In complying with Directions 3(g) & 3(h), ensure that policies (including policies embodied in resource allocation decisions) relating to CSIRO's scientific research and technology transfer activities [SIR Act s9(1)(a) and (b)] are so expressed that they can be reported for purposes of SIR Act s51:
- as at the start of each reporting period; and
- as developed during the reporting period.
3.5 Processes – Systems of Internal Control
(k) Establish and maintain an appropriate system of internal controls for CSIRO [PGPA Act s 16(b)].
(l) Implement and maintain systems to ensure CSIRO's scientific research is conducted in accordance with Australian and international standards for responsible conduct of research, and to ensure the high quality of CSIRO's research and scientific and technical advice.
(m) Implement and maintain prudent and effective human resource, commercial, financial and administrative arrangements to secure the financial position and sustainability of the Organisation [PGPA Act s15(c)].
(n) Implement measures directed at ensuring compliance with all applicable laws and Government policies and directives, including the Commonwealth Procurement and other Rules [PGPA s16(b)] and CSIRO’s policies, standards and procedures; and implement and maintain systems to identify and address breaches in such matters.
(o) Implement and maintain systems, including suitable induction and staff education, to ensure CSIRO's statutory obligations and policies, standards and procedures are understood and complied with, including the CSIRO Code of Conduct.
(p) Promote CSIRO's values and the CSIRO Code of Conduct and provide guidance to CSIRO and its researchers when engaging in public debate.
3.6 Delegations and Authorities
(q) Ensure that delegations [SIR Act s10J(1)] and authorities [SIR Act s10A(4)] by the Chief Executive and delegations by the Board [SIR Act s22A] are appropriate and are properly documented in the CSIRO Delegations and Authorities Manual, and that:
I) all delegations to eligible persons and committees of eligible persons are approved by the Board [SIR Act s10J(2)].
II) the Delegations and Authorities Framework is presented to the Board annually for (re)confirmation.
III) ensure CSIRO does not enter into major transactions unless and until relevant approvals have been given in accordance with the Chief Executive and Board Major Transactions Threshold Table, as approved by the Board; and
IV) at each Board meeting a report is provided on:
- transactions entered by the Chief Executive
- matters notified to Minister
unless those matters have been separately reported to the Board in accordance with Direction 3(p)(iii) and Direction 4(j).
4. Assurance
4.1 Compliance
(a) Conduct the affairs of CSIRO in accordance with the requirements of all applicable laws and regulations including the SIR Act and PGPA Act and prescribed Rules, the applicable policies of the Government, and the policies of CSIRO.
(b) Ensure that CSIRO performs its functions in accordance with:
- the Corporate Plan and other plans approved by the Board for the relevant period; and
- the policies of the Organisation, including:
- CSIRO Freedom to Conduct CSIRO Research and Technology Transfer Policy, as approved by the Board in November 2006; and
- CSIRO Science and Delivery; People; Governance; Risk; Child Safe, Finance, Shareholding and Health, Safety and Environment Policies, as approved by the Board in February 2010 and amended from time to time.
(c) Ensure that any policies of the Government notified to CSIRO are carried out in relation to CSIRO and any subsidiary of CSIRO, so far as practicable [PGPA Act s22].
(d) ensure that any directions or guidelines given to the CSIRO Board by the Minister are complied with [SIR Act s13].
(e) Ensure, as far as practicable, that none of CSIRO's subsidiaries does anything that the CSIRO does not itself have power to do [PGPA Act s86].
(f) Report regularly to the Board on compliance with policies approved by the Board and to the Board Audit and Risk Committee and Board People, Health and Safety Committee on compliance with standards and procedures as relevant to the Charters of those committees.
4.2 Financial management
(g) Ensure that all banking, borrowing and investment by CSIRO is properly conducted and authorised in accordance with the PGPA Act and prescribed Rules [PGPA Act s54, s57, s59].
(h) Ensure that accounts and records are kept that properly record and explain the transactions and financial position of CSIRO and in a way that:
- enables the preparation of the financial statements required by the PGPA Act; and
- allows those financial statements to be conveniently and properly audited in accordance with the PGPA Act [PGPA Act s41].
(i) Ensure that the granting of indemnities, guarantees or warrantees by CSIRO, and the obtaining of insurance by CSIRO, complies with the PGPA Act and prescribed Rules [PGPA Act s61 & s62].
4.3 Duty to inform and Ministerial notifications
(j) Keep the Board and the Minister informed of the activities of CSIRO and its subsidiaries, give the Board and the Minister reasonable notice of significant issues that affect CSIRO, and notify the Board and the Minister of significant events [PGPA Act s19].
(k) Give the Board and the Minister or the Finance Minister in a timely way any reports, documents and information in relation to those activities as that Minister requires [PGPA Act s19(1)(b)].
(l) Ensure information on company and share dealings, as set out in PGPA Act s72 and prescribed Rules, is provided to the Minister in order to cause a notice of the event to be tabled in each House of the Parliament as soon as practicable after the event occurs.
(m) Keep the Board informed of any non‐compliance with the PGPA Act or events which may materially affect CSIRO's financial sustainability.
(n) Provide support to Commonwealth organisations and bodies where such relationships reinforce CSIRO's strategic objectives.
5. Performance
(a)Implement processes to properly record and explain, and measure and assess, the performance of CSIRO [PGPA s37‐39].
(b) Prepare an annual performance statement, in accordance with the PGPA Act, for consideration by the Board and inclusion in the annual report [PGPA s37‐39]; and have the report available for examination by the Auditor‐General, if required [PGPA s40].
(c) Ensure that the financial statements of CSIRO and any subsidiary of CSIRO are:
- prepared in accordance with the PGPA Act and prescribed Rules and present fairly CSIRO's financial position, financial performance and cash flows [PGPA s42 & 44].
- audited by the Auditor‐General [PGPA Act s42‐44].
(d) Prepare for consideration by the Board an Annual Report in accordance with s51 of the SIR Act and Division 6 of the PGPA Act and prescribed Rules by 31 August immediately following the end of the reporting period for CSIRO. Following approval of the annual report by the Board, give the annual report to the Minister on or before 15 October immediately following the end of the reporting period which is the subject of the report [SIR Act s51 & PGPA Act s46].
(e) Prepare any other performance and compliance as required by the Government in a timely and accurate manner for approval by the Board.
Effective 1 July 2022
Introduction
CSIRO is a body corporate constituted and operating under the Science and Industry Research Act 1949 (SIR Act) and a corporate Commonwealth entity operating under the Public Governance, Performance and Accountability Act 2013 (PGPA Act) .
The main purpose of this instrument is to set out the formal directions given by the Board of CSIRO to the Chief Executive of CSIRO under the SIR Act.
The directions are also intended to harmonise the requirements of the SIR Act and the PGPA Act so that CSIRO will be governed seamlessly and be fully compliant with the requirements of both Acts.
Roles of Board and Chief Executive
The Board is responsible to the Commonwealth Government for the overall strategy, governance and performance of CSIRO. The functions of the Board are:
- to ensure the proper and efficient performance of the functions of the Organisation
- to determine the policy of the Organisation with respect to any matter
- to give directions to the Chief Executive; and
- such other functions as are conferred on it by the SIR Act 1949.
The Board has the power to do all things necessary or convenient to be done for, or in connection with, the performance of its functions [SIR Act s12].
The Board, as the accountable authority for CSIRO, also has a range of duties under the PGPA Act.
The Board has articulated how it will fulfil its functions and duties in more detail in the CSIRO Board Charter and Board Governance Document.
The SIR Act specifies that the affairs of CSIRO shall be conducted by the Chief Executive subject to any policies determined by the Board and any directions given to the Chief Executive by the Board [SIR Act s10A].
The Board works with and through the Chief Executive of CSIRO to ensure the Organisation fulfils its functions.
The Chief Executive is responsible to the Board for the overall development of strategy, management and performance of CSIRO. The Chief Executive manages the Organisation in accordance with the strategy, plans and policies approved by the Board to achieve the Organisation's objectives.
Directions to the Chief Executive
By a resolution of the Board of Commonwealth Scientific and Industrial Research Organisation (CSIRO) dated 1 July 2018, pursuant to subsection 10A(3) and paragraph (1c) of section 12 of the Science and Industry Research Act 1949 [SIR Act], the following directions were given to the Chief Executive of CSIRO. The directions remain in force until amended or revoked by the Board of CSIRO.
The Chief Executive of CSIRO must:
1 General
1.1 Assist the Role of the Board
(a) Assist the Board and its committees to fulfil the functions and duties of the Board and their respective Charters by:
- providing high quality management reports, discussion papers and proposals as required, including on the focus areas identified from time to time by the Board and those needed for the annual programs of work (Forward Planner) set by the Board and its committees
- ensuring matters presented to the Board for decision are supported by reliable and competent information and advice so the Board may exercise due diligence and care [PGPA Act s25] and make decisions in the best interest of CSIRO
- provide timely information to the Board of possible events and changes that might affect the direction and operations of the Organisation including emerging risks and opportunities
- reporting regularly against the strategies and plans approved by the Board, including the Corporate Plan, and performance measures, to ensure that the Board and its committees are kept properly informed about progress and promptly advised of any departures from plans or policies; and
- ·offering proposals for improvement in Board operations and the working relationship with management.
(b) Facilitate communication between Board Members, Board Committee members, senior managers of CSIRO and the internal and external auditors of CSIRO in order to promote good governance, with particular reference to the duties of the Board under the PGPA Act.
1.2 Governance
(c) With the Board, govern CSIRO in a way that:
- promotes the proper use and management of public resources for which CSIRO is responsible
- promotes the achievement of the purposes of CSIRO (i.e., the functions of CSIRO in the SIR Act s9)
- promotes the financial sustainability of CSIRO; and
- promotes the health and safety of CSIRO staff, visitors and affiliates.
In making decisions in relation to (i to iii), take into account the effect of those decisions on public resources generally [PGPA Act s 15].
When enacting decisions approved by the Board, ensure those decisions align with the Board’s agreed position.
Proper, when used in relation to the use or management of public resources, means efficient, effective, economical and ethical.
1.3 Personal duties
(d) Give written notice to the Board of all direct or indirect pecuniary interests the Chief Executive has or may have in any business or in any body corporate carrying on a business [SIR Act s10F] and notice of any material personal interest in a matter that relates to the affairs of CSIRO [PGPA Act s29]. This may include a standing notice of the nature and extent of the interest.
2. Direction
2.1 Strategy development and implementation
(a) In close consultation with the Board, prepare and submit for consideration and approval by the Board a draft Corporate Plan [PGPA Act s35] for an agreed planning period setting out:
- the objectives of CSIRO in performing its functions
- an outline of the policies and strategies to be pursued by CSIRO to achieve those objectives
- the activities CSIRO proposes to carry out; and
- the resources CSIRO proposes to allocate to each such activity
The plan must cover CSIRO and any subsidiaries. [PGPA Act s35(5)].
(b) Ensure the Corporate Plan sets out how the activities of CSIRO will contribute to achieving the key priorities and objectives of the Australian Government as related to the purpose of CSIRO; and ensure the Plan complies with the prescribed Rules [PGPA Act s34 & s 35].
(c) Give the Corporate Plan to the responsible Minister and the finance minister, following approval by the Board, in accordance with the prescribed Rules [PGPA Act s35(1)(b)].
(d) Ensure the strategy and operations of CSIRO are informed by effective advisory mechanisms and when issued, by the Ministerial Statement of Expectations for CSIRO.
(e) Encourage CSIRO leaders to cooperate with others to achieve common objectives, where practicable [PGPA Act s 17]; and ensure CSIRO cooperates with other organisations [SIR Act s10] in the coordination of scientific research, with a view to:
- the prevention of unnecessary overlapping; and
- the most effective use of available facilities, collections and staff.
(f) Conduct an annual review of the approved Corporate Plan with the Board.
(g) Ensure the effective governance, communication and delivery of the approved Corporate Plan.
(h) Submit more detailed strategies and investment proposals to support delivery of the Corporate Plan to the Board for advice, endorsement or approval as appropriate. This includes all matters which would have a material impact on the Organisation.
Material matters include matters involving a major, long-term research, relationship or financial commitment; a major change in CSIRO's research priorities and capacity; high enterprise level residual risk; and matters potentially outside of the policies and strategies of the Board. Examples include industry and international strategies, new policy proposals to the Government and internal portfolio investment cases.
2.2 Resource allocation and efficient use of public resources
(i) Prepare budget estimates for approval by the Board for each reporting period, and for any other periods directed by the finance minister and give the estimates to the Finance Secretary in accordance with their written directions, once approved by the Board [PGPA Act s36(1)].
(j) Ensure the budget estimates fairly present the estimated financial impacts of CSIRO's activities for the reporting period or other period and comply with Finance Secretary Directions [PGPA Act s36(2)].
(k) When imposing requirements on others in relation to the use or management of public resources for which CSIRO is responsible, take into account:
- the risks associated with that use or management; and
- the effects of imposing those requirements [PGPA Act s 18].
3. Transformation
3.1 Operations
(a) Ensure CSIRO has an effective Operating Model that:
- adopts best practice relevant to organisation of CSIRO’s type
- embeds performance related metrics
- delivers sustainable efficient, effective and timely business operations and services
- supports a positive culture and clear direction
- strengthens stakeholder, customer and market focus
- is fit for service with sufficient flexibility for a dynamic environment
- provides for security of the Organisation's human, physical and virtual assets
- incorporates a continuous improvement program; and
- supports the execution of CSIRO’s Strategy.
(b) Ensure the Board is consulted on:
- ·organisational structure, including the senior executive structure immediately below the Chief Executive, the portfolio responsibilities of members of the Executive Team, and the structure of business units
- selection of people to fill these positions and the overall balance of the Executive Team including skill mix and diversity; and
- succession planning for senior executive positions.
3.2 Capability
(c) Ensure that CSIRO's organisational capability:
- delivers world class scientific research and delivers valued impacts for our customers.
- incorporates mechanisms to reward and recognise our scientists where world class impacts are delivered
- supports the acceleration of our overall rates of international engagement, operations and collaboration where there is a higher potential impact value return to Australia than available domestically; and
- is maintained and enhanced through programs that attract and cultivate diverse and world-class staff, retains the right people, and plans for succession.
(d) Ensure a cohesive, healthy and safe working environment in which teamwork, inclusion, trust, creativity and innovation flourish; and in which staff are treated with equity and respect, act with integrity, honesty and openness, and may contribute effectively to the achievement of CSIRO's purpose and objectives
(e) Ensure staff consultation, in accordance with the Enterprise Agreement, and through the Consultative Council [SIR Act s56]
(f) Encourage and foster effective communication processes.
3.3 Risk
(g) Establish and maintain an organisational risk framework that facilitates the identification and management of strategic, operational and external risk [PGPA Act s 16(a)] to a level commensurate with CSIRO's risk appetite and is supported by plans and reporting systems to confirm their efficiency and effectiveness. The framework should identify, at a minimum, risks associated with:
i. the brand and reputation of the organisation.
ii. customer delivery through science, collaboration and innovation including a recognition that the risk of failure is inherently high in undertaking challenging science, however actions that compromise scientific integrity, impartiality and independence are unacceptable.
iii. people, health, safety and environment recognizing that in pursuing our science we undertake many activities with a high inherent risk relating to health, safety and the environment but these risks must be managed to an aspiration of zero harm. There is no tolerance for actions that endanger the safety of our people.
iv. commercial and financial risks that imperil a long term sustainable financial position whilst recognising that Strategy 2020 and the dynamic global environment in which CSIRO operates demands engagement with new commercial business models and approaches in a global context.
v. governance and compliance risk that conflict with the objective of consistently demonstrating accountable, transparent, inclusive and informed decision making.
vi. Innovation through resilient strategies to solve the big problems facing Australia within the context of maintaining good governance and learning from failure.
vii. Our high public profile combined with the strategic necessity and attendant advantages of being closely aligned to areas of policy contention, while maintaining our trusted advisor positioning and close adherence to our public comment policy.
In addition, the framework should explicitly address organisational resilience and the processes and practices in place to identify, mitigate and, when required, respond to the myriad of threats that inevitably arise in a large, multi-faceted and geographically diverse organisation.
The risk framework is to be reviewed annually and presented to the Board for confirmation.
3.4 Policies
(h) Formulate for Board approval a Policy Framework and the policies necessary to ensure that CSIRO achieves its objectives and complies with all applicable laws and Government policies and directives.
(i) Maintain a complementary set of more detailed standards, procedures and guidelines to be approved by the Chief Executive or Senior Managers in accordance with the Policy Framework.
(j) In complying with Directions 3(g) & 3(h), ensure that policies (including policies embodied in resource allocation decisions) relating to CSIRO's scientific research and technology transfer activities [SIR Act s9(1)(a) and (b)] are so expressed that they can be reported for purposes of SIR Act s51:
- as at the start of each reporting period; and
- as developed during the reporting period.
3.5 Processes – Systems of Internal Control
(k) Establish and maintain an appropriate system of internal controls for CSIRO [PGPA Act s 16(b)].
(l) Implement and maintain systems to ensure CSIRO's scientific research is conducted in accordance with Australian and international standards for responsible conduct of research, and to ensure the high quality of CSIRO's research and scientific and technical advice.
(m) Implement and maintain prudent and effective human resource, commercial, financial and administrative arrangements to secure the financial position and sustainability of the Organisation [PGPA Act s15(c)].
(n) Implement measures directed at ensuring compliance with all applicable laws and Government policies and directives, including the Commonwealth Procurement and other Rules [PGPA s16(b)] and CSIRO’s policies, standards and procedures; and implement and maintain systems to identify and address breaches in such matters.
(o) Implement and maintain systems, including suitable induction and staff education, to ensure CSIRO's statutory obligations and policies, standards and procedures are understood and complied with, including the CSIRO Code of Conduct.
(p) Promote CSIRO's values and the CSIRO Code of Conduct and provide guidance to CSIRO and its researchers when engaging in public debate.
3.6 Delegations and Authorities
(q) Ensure that delegations [SIR Act s10J(1)] and authorities [SIR Act s10A(4)] by the Chief Executive and delegations by the Board [SIR Act s22A] are appropriate and are properly documented in the CSIRO Delegations and Authorities Manual, and that:
I) all delegations to eligible persons and committees of eligible persons are approved by the Board [SIR Act s10J(2)].
II) the Delegations and Authorities Framework is presented to the Board annually for (re)confirmation.
III) ensure CSIRO does not enter into major transactions unless and until relevant approvals have been given in accordance with the Chief Executive and Board Major Transactions Threshold Table, as approved by the Board; and
IV) at each Board meeting a report is provided on:
- transactions entered by the Chief Executive
- matters notified to Minister
unless those matters have been separately reported to the Board in accordance with Direction 3(p)(iii) and Direction 4(j).
4. Assurance
4.1 Compliance
(a) Conduct the affairs of CSIRO in accordance with the requirements of all applicable laws and regulations including the SIR Act and PGPA Act and prescribed Rules, the applicable policies of the Government, and the policies of CSIRO.
(b) Ensure that CSIRO performs its functions in accordance with:
- the Corporate Plan and other plans approved by the Board for the relevant period; and
- the policies of the Organisation, including:
- CSIRO Freedom to Conduct CSIRO Research and Technology Transfer Policy, as approved by the Board in November 2006; and
- CSIRO Science and Delivery; People; Governance; Risk; Child Safe, Finance, Shareholding and Health, Safety and Environment Policies, as approved by the Board in February 2010 and amended from time to time.
(c) Ensure that any policies of the Government notified to CSIRO are carried out in relation to CSIRO and any subsidiary of CSIRO, so far as practicable [PGPA Act s22].
(d) ensure that any directions or guidelines given to the CSIRO Board by the Minister are complied with [SIR Act s13].
(e) Ensure, as far as practicable, that none of CSIRO's subsidiaries does anything that the CSIRO does not itself have power to do [PGPA Act s86].
(f) Report regularly to the Board on compliance with policies approved by the Board and to the Board Audit and Risk Committee and Board People, Health and Safety Committee on compliance with standards and procedures as relevant to the Charters of those committees.
4.2 Financial management
(g) Ensure that all banking, borrowing and investment by CSIRO is properly conducted and authorised in accordance with the PGPA Act and prescribed Rules [PGPA Act s54, s57, s59].
(h) Ensure that accounts and records are kept that properly record and explain the transactions and financial position of CSIRO and in a way that:
- enables the preparation of the financial statements required by the PGPA Act; and
- allows those financial statements to be conveniently and properly audited in accordance with the PGPA Act [PGPA Act s41].
(i) Ensure that the granting of indemnities, guarantees or warrantees by CSIRO, and the obtaining of insurance by CSIRO, complies with the PGPA Act and prescribed Rules [PGPA Act s61 & s62].
4.3 Duty to inform and Ministerial notifications
(j) Keep the Board and the Minister informed of the activities of CSIRO and its subsidiaries, give the Board and the Minister reasonable notice of significant issues that affect CSIRO, and notify the Board and the Minister of significant events [PGPA Act s19].
(k) Give the Board and the Minister or the Finance Minister in a timely way any reports, documents and information in relation to those activities as that Minister requires [PGPA Act s19(1)(b)].
(l) Ensure information on company and share dealings, as set out in PGPA Act s72 and prescribed Rules, is provided to the Minister in order to cause a notice of the event to be tabled in each House of the Parliament as soon as practicable after the event occurs.
(m) Keep the Board informed of any non‐compliance with the PGPA Act or events which may materially affect CSIRO's financial sustainability.
(n) Provide support to Commonwealth organisations and bodies where such relationships reinforce CSIRO's strategic objectives.
5. Performance
(a)Implement processes to properly record and explain, and measure and assess, the performance of CSIRO [PGPA s37‐39].
(b) Prepare an annual performance statement, in accordance with the PGPA Act, for consideration by the Board and inclusion in the annual report [PGPA s37‐39]; and have the report available for examination by the Auditor‐General, if required [PGPA s40].
(c) Ensure that the financial statements of CSIRO and any subsidiary of CSIRO are:
- prepared in accordance with the PGPA Act and prescribed Rules and present fairly CSIRO's financial position, financial performance and cash flows [PGPA s42 & 44].
- audited by the Auditor‐General [PGPA Act s42‐44].
(d) Prepare for consideration by the Board an Annual Report in accordance with s51 of the SIR Act and Division 6 of the PGPA Act and prescribed Rules by 31 August immediately following the end of the reporting period for CSIRO. Following approval of the annual report by the Board, give the annual report to the Minister on or before 15 October immediately following the end of the reporting period which is the subject of the report [SIR Act s51 & PGPA Act s46].
(e) Prepare any other performance and compliance as required by the Government in a timely and accurate manner for approval by the Board.