Telstra 2010 Annual Report Download - page 55

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Telstra Corporation Limited and controlled entities
Corporate Governance Statement
regulatory issues, and other matters arising from, or in
connection with, the NBN.
Risk Oversight and Management
Management of opportunities and risks
Telstra faces a variety of risks due to the complexity of
its business and the dynamic business environment in
which we operate. The effective management of risks
enables Telstra to achieve its objectives, create value
for our shareholders, satisfy our customers, and protect
our staff, our assets, the community, and the natural
environment. Telstra’s commitment is to manage those
risks that arise in the course of Telstra’s business to an
acceptable level, so as to maximise opportunities and
minimise negative outcomes. Recognising this, Telstra
has established a formal and robust approach for
assessing, treating and monitoring risks related to the
successful pursuit of its business objectives.
This approach is supported by Telstra’s Risk
Management Framework which includes the Telstra Risk
Management Policy, and Risk Management Methodology
and Tools. The Framework aligns with ISO 31000 Risk
Management – Principles and Guidelines, the global
standard for risk management, and is also supported by
Telstra’s Business Principles and a number of other
policies that directly or indirectly seek to manage risks.
Risk management roles and responsibilities
Risk management occurs at all levels of the Company.
Telstra management and staff have primary
responsibility and accountability for the proactive
identification, ownership and management of risks.
Management are responsible for ensuring that they
have appropriate resources and expertise available to
detect, prevent and respond to risks and to provide
comprehensive, timely and reliable risk information to
key stakeholders.
In addition, Telstra has groups which manage and
report in specialised areas such as Compliance, Climate
Change, Treasury, Insurance, Credit, and Regulatory
risks.
Your Board monitors the integrity of the internal control
and reporting systems, the strategic risk management
systems, and the processes for managing Telstra’s
strategic risks. In addition, the Board has established a
program for its review and oversight of Telstra’s
strategic risks.
The Audit Committee monitors and advises on Telstra's
risk management process and the management of
specific risk areas as directed by the Board, in particular
in relation to financial, operational and compliance risks.
Telstra’s Risk Management and Assurance group
supports management, the Audit Committee and the
Board by working with the business to facilitate risk
assessments in key areas and by providing independent
assurance that the internal control and risk
management system, environment and processes are
operating effectively.
For the financial year ended 30 June 2010, the CEO and
CFO have provided the Board with the certifications
required by the Corporations Act and the ASX Principles
and Recommendations. Specifically, your Board has
received:
• Reports from management as to the
effectiveness of the Company’s management of
its material business risks;
• The declaration from the CEO and CFO required
in accordance with section 295A of the
Corporations Act that the Company’s financial
reports for the year ended 30 June 2010
presented a true and fair view of the Company’s
financial position and performance and were in
accordance with relevant accounting standards;
and
• Assurance from the CEO and CFO that the
section 295A declaration was founded on a
sound system of risk management and internal
control and that the system is operating
effectively in all material respects in relation to
financial reporting risks.
Telstra Values, Telstra Business Principles, Code
of Conduct and other Company policies
We have a number of internal operating policies and
principles which promote ethical and responsible
decision making and behaviour.
We provide guidance to our Directors, senior
management and employees on the standards of ethical
business and personal behaviour required of all of our
officers and employees in performing their daily
business activities through the Telstra Values, the
Telstra Business Principles and our Company policies,
including our Code of Conduct. A mandatory training
program for all employees is in place to reinforce these
standards.
Our Values, the Telstra Business Principles and our Code
of Conduct are available on our website.
Whistleblower policy and service
We have a whistleblower policy and a confidential
whistleblower service which provides our staff with an
avenue to raise concerns they might have with
behaviour that is potentially illegal, improper or
unethical. The whistleblowing process is supported by
an independent service provider who specialises in
receiving sensitive reports or disclosures. All reports or
disclosures are treated as confidential and reports can
be made anonymously. Reports are referred to our
Ethics Committee which is made up of senior managers
and oversees the investigation of these matters and the
implementation of any recommendations considered
appropriate.
The Audit Committee oversees the whistleblowing
program, receives regular reports from the Ethics
Committee, and provides an escalation channel for the
Ethics Committee where required. Our whistleblowing