Appendix C: A Corporate Governance Statement

Local Authority Governance of Subsidiary Entities.

In paragraph 777 on page 110 we recommend that shareholding local authorities encourage company boards to include a corporate governance statement in their Statement of Corporate Intent. A corporate governance statement could cover the following elements.

  • Structure, function, and obligations of the board, addressing:
    • role of the board;
    • mix of executive and non-executive directors;
    • size and structure of the board, including the composition and roles of board committees;
    • obligations of the board in relation to the SCI, the annual report, and the statement of shareholder expectations;
    • policies for the provision of services to the company by directors; and
    • customer service obligations.
  • Guidance and resources provided to directors, identifying:
    • resources available to directors to carry out their duties;
    • ongoing director training programmes;
    • succession planning for the board;
    • the code of conduct for the organisation, including a commitment to having appropriate regard for its social obligations, environmental responsibilities and community welfare; and
    • processes for evaluating the performance of the board and of individual directors.
  • Significant policies in place for accountability, including:
    • specific policies for communicating with shareholders and other stakeholders;
    • risk management policies and procedures; and
    • policies for the selection and remuneration of directors and the chief executive.
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