Qantas 2011 Annual Report Download - page 25

23 ANNUAL REPORT 2011
for the year ended 30 June 2011
Corporate Governance Statement continued
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 
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  per cent of their
gross income (other than Directors’ fees paid by Qantas), and
— When the relationship is with a rm, company or entity, in respect of
which the Director (or any associate) has more than a  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
$ million per annum
— In respect of suppliers – where goods or services purchased
by the Qantas Group exceed  per cent of Qantas’ annual
consolidated gross revenue (other than banks, where materiality
must be determined on a case-by-case basis), and
— In respect of customers – where goods or services supplied
by the Qantas Group exceed  per cent of Qantas’ annual
consolidated gross revenue
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 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  Annual General Meeting, 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
– Diversity obligations
– Directors’ induction and continuing development
– Committee Membership
– Endorsement of Executive Management appointments
The experience and qualications of Members of the Nominations
Committee are detailed on pages  and . Membership of and
attendance at / Nominations Committee Meetings are
detailed on page .
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.
Diversity
Qantas has reported on diversity in its Sustainability Report since .
The ASX Principles have been revised to require companies to establish
diversity-related measurable objectives, undertake an annual
assessment against the objectives and make related disclosures
in the  Annual Report. In the interim Qantas has continued to
report diversity statistics, including the following gender statistics,
in the Sustainability Statistics and Notes on pages  and :
— The proportion of women employees in the organisation
— The proportion of women in senior executive positions
— The proportion of women on the Board of Directors
Qantas is currently developing and formalising targets for diversity
in line with the requirements under the ASX Principles, which will be
disclosed in the  Annual Report.
The Diversity Statement is available in the Corporate Governance
section on the Qantas website.
Induction and Continuing Development of Directors
A formal induction program is available to new Directors to ensure
they have a working knowledge of Qantas (including its culture and
values) and the aviation industry. The Directors have open access
to all relevant information, including discussions with Management
and subject matter experts, and visits to operations. Directors may
meet independently with Management at any time to discuss areas
of interest or concern.