Qantas 2004 Annual Report Download - page 39

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2004 Corporate Governance Statement continued
Qantas Annual Report 2004 37Spirit of Australia
THE BOARD IS STRUCTURED TO ADD VALUE
Qantas has 12 Directors (see details on pages 32 to 35). Eight Directors are Independent Non-Executive Directors elected by shareholders
other than British Airways – the Independent Non-Executive Directors are:
Director Year of Appointment
Margaret Jackson (Chairman) 1992
Paul Anderson 2002
Michael Codd 1992
Patricia Cross 2004
Trevor Eastwood 1995
Jim Kennedy 1995
James Packer 2004
John Schubert 2000
Independence
Independent Directors are those who have the ability to exercise their duties unfettered by any business or other relationship and are
willing to express their opinions at the board table free of concern about their position or the position of any third party. The Qantas Board
does not believe it is possible to draft a list of criteria which are appropriate to characterise, in all circumstances, whether a Non-Executive
Director is independent. It is the approach and attitude of each Non-Executive Director which is critical and this must be considered in
relation to each Director while taking into account all other relevant factors, which may include whether the Non-Executive Director:
is a substantial shareholder (within the definition of section 9 of the Corporations Act) of Qantas, or an officer of, or otherwise
associated directly with, a substantial shareholder of Qantas (as such, the BA Directors are not considered to be independent);
has, within the last three years, been employed in an executive capacity by the Qantas Group;
has, within the last three years, been a principal of a material professional adviser or a material consultant to the Qantas Group
or an employee materially associated with the service provided;
is a material supplier or customer of the Qantas Group, or an officer of or otherwise associated directly or indirectly with, a material
supplier or customer;
has any material contractual relationship with the Qantas Group other than as a Director;
has served on the Board for a period which could materially interfere with the Director’s ability to act in the best interests of the Qantas
Group (and it is neither possible nor appropriate to assign a fixed term to this criteria); or
is free from any interest and any business or other relationship which could, or could reasonably be perceived to, materially interfere
with the Director’s ability to act in the best interests of Qantas.
All Qantas Independent Non-Executive Directors bring a real independent view to the consideration of Board issues. In addition, two new
Independent Non-Executive Directors have been appointed in the last 12 months (Patricia Cross and James Packer). The appointment of
these new Directors has refreshed the Board and incorporated new ideas and energy.
Qantas believes that the following materiality thresholds are relevant when considering the independence of Non-Executive Directors:
for Directors:
a relationship which accounts for more that 10% of his/her gross income (other than Director’s fees paid by Qantas); or
when the relationship is with a firm, company or entity, in respect of which the Director (or any associate) has more than
a 20% shareholding if a private company or 2% shareholding if a listed company; and
for Qantas:
in respect of advisers or consultants – where fees paid exceed $2 million pa;
in respect of suppliers – where goods or services purchased by the Qantas Group exceed $100 million pa (other than banks,
where materiality must be determined on a case by case basis); or
in respect of customers – where goods or services supplied by Qantas Group exceed $100 million pa.
Qantas, as the principal Australian airline, has commercial relationships with most, if not all, major entities in Australia. As such, in
determining whether a Non-Executive Director is independent, simply being a non-executive director on the board of another entity is
not, in itself, sufficient to affect independence. Nevertheless, any Director on the board of another entity is ordinarily expected to excuse
themselves from any meeting where that entity’s commercial relationship with Qantas is directly or indirectly discussed. BA Directors must
consult with the Chairman, on a case by case basis, their attendance during discussions concerning the relationship between Qantas and
British Airways.