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Corporate Governance Statement (continued)

1.5 Directors’ Independence

The Board considers that it should include significant representation by

Directors who are capable and willing to make decisions which are in

the best interests of members, free from interests and influences which

conflict with that duty and are also independent of management.

The Board assesses the independence of each Director in accordance

with the terms of the Board Charter, the interests they have disclosed

and such other factors as the Board determines are appropriate to

take into account. This assessment is carried out upon appointment,

annually and on an ongoing basis where circumstances in relation to a

Director may warrant reconsideration.

In making this determination the Board sought to assess whether

Directors were:

– independent of management; and

– free of any business or other relationship that could materially

interfere or be perceived to materially interfere with their unfettered

and independent judgement; and

– capable of making decisions without bias and which are in the best

interests of all members.

As noted in the Corporate Governance Principles and

Recommendations, the determination of independence as it relates to

the Trust as an externally managed entity, is made in relation to the

Responsible Entity in its corporate capacity rather than the Trust.

A non–executive Director is not regarded as an independent director if

that Director:

– is a substantial securityholder of Scentre Group or an officer of, or

otherwise associated directly with, a substantial securityholder of

Scentre Group ;

– within the last 3 years had been employed in an executive capacity

by any member of Scentre Group, or has been a Director after

ceasing to hold any such employment;

– within the last 3 years had been a partner or a senior management

executive with audit responsibilities of a firm which has acted in the

capacity of statutory auditor of any member of the Group;

– within the last 3 years had been a principal, employee or consultant

of a material professional adviser to any member of the Group – for

this purpose a material professional adviser is an adviser whose

billings to the Group exceed 1% of the adviser’s total revenues;

– is a principal, employee or associate of a material supplier to, or

material customer of, any member of the Group – for this purpose

a material supplier to the Group means a supplier whose revenues

from the Group exceed 5% of the supplier’s total revenues. A

material customer is a customer whose payments to the Group

exceed 1% of the customer’s operating costs;

– has a material contractual relationship with any member of the

Group other than as a Director of the Board; and

– has any interest or business or other relationship which could

materially interfere with the Director’s ability to act in the best

interests of the Group and independently of management.

The Board currently comprises 8 members. Of these, applying the

above criteria, 5 are independent non–executive Directors. They

are: Mr Brian Schwartz, Mr Richard Egerton–Warburton, Mr Andrew

Harmos, Mr Michael Ihlein and Ms Aliza Knox.

These Directors are considered by the Board to be independent of

management and free from any business or other relationship or any

other circumstance that could materially interfere with the exercise of

objective, unfettered or independent judgement. Before commencing

on the Board, each non–executive Director signs a letter of appointment

which, amongst other things, requires each independent Director to

promptly and fully disclose to the Board any matter or circumstance

which may have impacted on their status as an independent Director, or

the likely perception of their status, as an independent member of the

Board. In addition, Directors also consult with the Chairman before

accepting any additional commitments which may impact or conflict

with the time Directors can devote to Scentre Group. If a Director

loses their status as an independent Director, that determination will be

reported to the market.

The Nomination Committee’s Charter sets out the process for selection

and appointment of new Directors and re–election of incumbent

Directors. The role and responsibilities of the Nomination Committee

are set out later in this statement.

1.6 Chairperson and Independence

The Responsible Entity notes the ASX Corporate Governance Council’s

recommendation 2.5 that listed entities should have an independent

director as Chairman. Recommendation 2.5 does not apply to externally

managed entities.

However, the Responsible Entity has, in previous reports, outlined

reasons why the Board considered Mr Frank Lowy as the most

appropriate person to act as the Chairman of then Westfield Group

boards, and now Scentre Group boards.

Mr Lowy is the co–founder of Westfield and has overseen the success

of Westfield since 1960. With almost 55 years direct experience in

the design, construction and management of shopping centres and

associated fund and asset management, Mr Lowy’s depth of knowledge,

range of experience and reputation is unrivalled in the industry. Mr

Lowy’s exposure to and understanding of the industry is considered to

be of significant value to the Board.

In Australia and internationally, Mr Lowy is regarded as an exceptional

and unique individual who has overseen the growth of a global retail

business which is widely regarded as a leader in its field.

For these reasons, the Board takes the view that it is in the best

interests of members that Mr Lowy, with his extensive background and

experience, be the Chairman of Scentre Group and the Trust.

In arriving at this view, the Board notes that there is presently a

majority of independent Directors on the Scentre Group Board. This

was also the case during the financial year.

1.7 The Company Secretary

The Company Secretary is appointed and removed by the Board. The

Company Secretary operates with the Chairman, the Board and the

Board Committees on all governance related issues. All Directors

have access to the Company Secretary for the purpose of obtaining

information or advice. The Company Secretary may also retain the

services of independent advisory bodies, if requested by the Board or

Board Committees. The Company Secretary is responsible for ensuring

proper processes and procedures are in place for the Board and Board

Committees and that these are complied with. The Company Secretary

also advises the Board and Board Committees on governance matters.

The office of the Company Secretary is responsible for developing

and managing the systems and processes that enable the Board to

perform its role and provides secretariat services for each of the Board

Committees. Committee agendas, papers and minutes are available to

all members of the Board.

The Company Secretary is accountable to the Board, through the

Chairman, on all governance matters.

32 / Carindale Property Trust

Annual Report 2015