Qantas 2010 Annual Report Download - page 23

21 ANNUAL REPORT 2010
for the year ended 30 June 2010
Corporate Governance Statement continued
THE BOARD IS STRUCTURED TO ADD VALUE
Qantas currently has ten Directors (see details on pages 10 and 11).
Nine Directors are Independent Non-Executive Directors elected by
shareholders. The Independent Non-Executive Directors are:
Director
Year of
Appointment
Leigh Clifford (Chairman) 2007
Peter Cosgrove 2005
Patricia Cross 2004
Richard Goodmanson 2008
Garry Hounsell 2005
Paul Rayner 2008
John Schubert 2000
James Strong 2006
Barbara Ward 2008
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 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 de nition of section 9 of the
Corporations Act) of Qantas, or an of cer of, or otherwise associated
directly with, a substantial shareholder of Qantas
—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 of cer
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  xed term
to this criteria)
—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
The Board Charter requires each Director to immediately disclose to the
Board if they have any concerns about their independence.
All Independent Non-Executive Directors bring an independent view
to the consideration of Board issues.
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 than 10 per cent of their
gross income (other than Director’s fees paid by Qantas), or
– When the relationship is with a  rm, company or entity, in respect
of which the Director (or any associate) has more than a 20 per cent
shareholding if a private company or two per cent shareholding if
a listed company
—For Qantas:
– In respect of advisers or consultants – where fees paid exceed
$2 million per annum
– In respect of suppliers – where goods or services purchased by
the Qantas Group exceed $100 million per annum (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
the Qantas Group exceed $100 million per annum
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,
suf cient to affect independence. Nevertheless, any Director on the
board of another entity is ordinarily expected to excuse themselves
during any meeting where that entity’s commercial relationship with
Qantas is to be directly or indirectly discussed.
Qantas currently has one Executive Director Alan Joyce, who is not
treated as independent.
Independent professional advice is available to the Directors if necessary,
at the expense of Qantas.
At the 2000 AGM, shareholders approved Qantas entering into Director
Protection Deeds with each Director.
Nominations Committee
The Nominations Committee:
—Has four Members who are Independent Non-Executive Directors
—Is chaired by Leigh Clifford
—Has a written Charter which is available in the Corporate Governance
section on the Qantas website
—Meets as required to assist the Board in ful lling its corporate
governance responsibilities in regard to:
– Board appointments, re-elections and performance
– Directors’ induction and continuing development
– Committee Membership
– Endorsement of Executive Management appointments
– Diversity obligations
The experience and quali cations of Members of the Nominations
Committee are detailed on pages 10 and 11. Membership of and
attendance at 2009/2010 Nominations Committee Meetings are
detailed on page 29.
Appointment and Re-Election of Directors
When appointing new Directors, the Board and its Nominations
Committee looks to ensure that an appropriate balance of skills,
experience, expertise and diversity is maintained. External consultants are
engaged to assist with the selection process as necessary and each Board
Member has the opportunity to meet with the nominated Director.
Directors receive formal letters of appointment setting out the key terms,
conditions and expectations of their appointment.
Directors to be re-elected are reviewed by the Nominations Committee.
Directors are re-elected in accordance with the Qantas Constitution and
the ASX Listing Rules.