AUSTRALIAN Wool Innovation is in the mood to adopt the recommendations of the body’s latest performance and governance review, AWI chief executive officer Stuart McCullough said today.
Mr McCullough said the maximum 10-year board term recommendation is one of several which could have far reaching ramifications on the director appointments and elections.
“AWI will fully consult with wool grower shareholders on any such recommendations.
“Recommendations like this are likely to require a constitutional vote at an AGM,” he said.
“It is premature to comment on potential resolutions for the next AGM.
“As noted above, AWI will fully consult with wool grower shareholders on any and all such matters, this may have to be undertaken by way of AGM resolutions.”
An AWI statement said its board is happy to accept the recommendations and plan the adoption forthwith. There are constitutional matters that will be presented as resolutions for shareholders to vote upon at the November 23 AGM. The board believes this report offers a way forward that will take the industry to a new level for the future, the statement said.
Mr McCullough said the review has recommended timelines for the introduction of various of the recommendations.
“Operationally we don’t see any issue, besides cost, in delivery these changes expeditiously and we will make sure wool growers are kept well informed of the progress.
“Board issues will be a matter for the board, but I can report the mood is to work to adopt these recommendations,” he said.
AWI today said it welcomed the release of the independent review into its performance and governance for the period 2015-2018. More than 1300 documents were submitted by AWI as part of the forensic examination, with the views of over 400 wool growers recorded together with 56 written submissions and face-to-face interviews with over 100 stakeholders and public comment.
In summary, 82 recommendations have been suggested, AWI said, with the areas of monitoring and evaluation, consultation and governance being the focus. The recommendations range in levels of importance from ‘mandatory’, ‘critical’ and ‘recommended’ and provide the company with timing suggestions for completion helping to pave the way for greater consultation, transparency and accountability.
Mr McCullough said the assessment of how AWI was performing against its responsibilities will be of great benefit to AWI in refining its processes and approach going forward.
“AWI acknowledges there are areas where we can enhance the way we operate and we look forward to improving delivery of our services to Australian wool growers, and the report provides a detailed roadmap to assist that process.”
Mr McCullough said AWI was pleased the report included important context about the scale of the Australian wool industry and the scope of AWI’s research and development role, including:
– The significant contribution of the wool industry to the Australian economy, including a $4.3 billion contribution to exports in 2017/18 (up from $1.9 billion 2009/10) and the employment of 200,000 people. This has seen the gross value of the Australian wool clip double since AWI recommenced a focus on strategic targeted marketing investments to drive demand for wool.
– EY’s finding of a gap between perception of AWI operations, policies and procedures, compared to the evidence they have reviewed. This has highlighted the need for AWI to focus on better explaining our processes and procedures and ensuring targeted open two-way consultation and communications.
– The range of forces impacting on the Australian wool industry and AWI’s role, including changes in processing, consumer behaviour, design trends, digital disruption and emerging markets.
– The current healthy state of the wool market for Australian growers, assisted by the marketing and research and development activities of AWI.
– The relatively low operational costs associated with the running of AWI.
“From an operational perspective we can advise that we intend to expeditiously adopt key recommendations that will assist to enhance our transparency and accountability and our consultation mechanisms with our shareholders and stakeholders,” Mr McCullough said.
A summary of the review’s findings will be sent to all wool growers as part of the WoolPoll process.
To hear more from Mr McCullough, listen to the latest edition of The Yarn here.
Under its funding model, AWI has a statutory obligation through the Statutory Funding Agreement to undergo a triennial independent performance review and is required to report this to levy-payers and the government prior to each WoolPoll event. On 27 February 2018, EY was engaged by the Department of Agriculture and Water Resources to conduct an independent review of AWI, into its performance and governance. AWI last underwent an independent performance review in 2015, covering performance over the preceding three years 2012-2015.