Corporate governance a box ticking exercise for ASX 50 firms

Australia’s 50 largest publicly-listed corporations are approaching corporate governance reporting as a ‘box-ticking’ exercise rather than a key factor in their sustainability and performance, according to research by the Association of Chartered Certified Accountants (ACCA).

Its 'Disclosures on Corporate Governance' report found the top 50 companies were generally effective in meeting criteria subject to Australian Securities Exchange (ASX) regulations, including disclosing the structure of their board (average score 90 per cent) and safeguards and integrity in financial reporting (average score 81 per cent).

However, it found they fell short when it comes to following international guidelines and global best practice in corporate governance reporting as well as in other categories.

ACCA’s Australia and New Zealand head, Michaela Campbell, said overall, the ASX top 50 are reporting on their corporate governance, however, the emphasis is on meeting mandatory ASX requirements.

“They must support policies with strong leadership, accountability and a culture that fosters an ethical, sustainable approach to corporate governance.

“With the global economic downturn diminishing faith in corporations, there is a real opportunity for companies to go beyond the minimum and reinforce the very purpose of governance — transparency, accountability, fairness and responsibility."

The report scored the overall performance of the ASX 50.

ANZ was the report’s top scorer on disclosure of corporate governance practices with 77 per cent, followed by Westpac (74 per cent) and BHP Billiton (69 per cent).