Annual Report 2003-2004

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Corporate governance

The department has a strong framework in place to ensure it is fulfilling its corporate governance responsibilities. The structures, decision-making processes and internal controls and behaviours outlined in this section support the effective achievement of our performance outcomes.

Senior Executive

The Secretary and the four deputy secretaries comprise the department's Senior Executive (see also Departmental Overview: Organisational structure on page 15). The Senior Executive is responsible for providing leadership and strategic direction for the department and for ensuring we are meeting our corporate governance requirements.

Dr Ashton Calvert AC, as Secretary and Chief Executive, provided direction on major foreign and trade policy issues, as well as in the corporate management of the department. He provided direct leadership in shaping and communicating the professional values and culture of the department in Australia and abroad. He decided personally all Senior Executive Service (SES) staff placements.

The four deputy secretaries supported the Secretary in overseeing the department's divisions as follows:

In addition to these responsibilities, the Senior Executive frequently represented the Government at high-level meetings, both in Australia and overseas. The deputy secretaries also chaired key corporate governance bodies (see below).

Management mechanisms

Our management mechanisms—listed below—ensure effective decision-making on, and communication of, corporate governance issues and policy and corporate priorities.

Senior Executive meetings

The Senior Executive held regular meetings on current policy issues with Mr Downer and Mr Vaile.

Weekly meetings of the Senior Executive, chaired by the Secretary, considered a range of issues requiring liaison with portfolio ministers, and monitored and guided corporate policy issues. The heads of the Corporate Management Division, and the Diplomatic Security, Information Management and Services Division, and, as appropriate, the Director General of AusAID, also attended these meetings. These meetings considered regular reports on the department's budgetary and staffing situation, IT budget and performance, property issues, passport developments, and divisional performance on ministerial correspondence and security breaches.

Senior management committees

Audit Committee

The Audit Committee, which meets quarterly, helps the Secretary ensure that the assurance and control framework operating in the department is effective and supports departmental objectives. Chaired by a Deputy Secretary not directly responsible for overseeing the Corporate Management Division, the Audit Committee is charged with:

In addition to senior departmental officers, the committee includes an independent member. Our Chief Finance Officer and staff from our Evaluation and Audit Section and the ANAO attend each meeting as observers.

Ethics Committee

The Ethics Committee oversees the development and implementation of policy on ethics and conduct issues and the work of the Conduct and Ethics Unit. The committee comprises ten members from various levels within the department and is chaired by a Deputy Secretary. It meets quarterly to provide guidance and management of DFAT practice and process in handling ethics-related issues. In doing so, it draws on the expertise of its ex-officio members, including the First Assistant Secretary, Corporate Management Division; the Director, Administrative and Domestic Law Group; and the Director, Management Strategy, Conduct and Coordination Section.

Workplace Relations Committee

The Workplace Relations Committee is the primary consultative body for human resource management and conditions of service issues affecting Australia-based employees. It provides a forum for discussions between management and staff representatives about the working environment, conditions of service and matters of concern to staff.

The committee is chaired by the Secretary or his nominee, normally a Deputy Secretary. Members include representatives from management areas and nine elected staff representatives (two from each of the four employee broadbands and one SES employee). The Association of Foreign Affairs and Trade Employees (AFTE), the Community and Public Sector Union (CPSU), the Australian Manufacturing Workers' Union (AMWU) and the Media, Entertainment and Arts Alliance (MEAA) are also represented on the committee. The committee meets at least four times a year.

Other senior management meetings and mechanisms

Weekly meetings with division heads, chaired by the Secretary, are the central means of communicating corporate and policy priorities more broadly throughout the department. In addition, the Secretary's regular strategic planning meetings with division heads provide senior executive staff with an opportunity to develop collectively a stronger sense of coherence and corporate unity in our policy work and in determining corporate management strategies. In a similar vein, the Secretary's seminars for branch heads offer a forum for forward-looking discussion on foreign and trade policy developments and major corporate management and leadership issues.

The Secretary communicates with staff in a variety of ways, including through his weekly reports, administrative circulars, our intranet and a staff newsletter, DFATNEWS.

Overseas posts participated in, and were kept informed of, policy and corporate developments through a variety of mechanisms:

Planning and review

At a broad level, the department's corporate plan, which was updated during the year, provides guidance on our future directions in implementing foreign and trade policy, and informs the planning for our activities. Each year, our performance expectations and planned use of resources are set out in our portfolio budget statements.

A series of departmental planning and review processes takes place throughout the year, ensuring we maintain a sharp focus on government priorities. They ensure that our resources are best directed to support the Government's foreign and trade policy objectives.

Divisional evaluation reviews

Divisional evaluation reviews take place in August each year, with a mid-term review in February. They serve two main purposes:

At the review in August 2003 and the mid-term review in February 2004, the Senior Executive evaluated the performance of all divisions and fine-tuned their work programs to take account of key government priorities. They also reviewed the resource allocations for all divisions, posts and state and territory offices, reallocating resources to meet new requirements and to facilitate projects that had acquired a higher priority.

Post evaluation reports

The department undertakes an annual evaluation of the performance of its overseas posts over the previous twelve months. The process acts as a central mechanism for ensuring that the work of the posts is focused on the Government's priorities. The evaluation assesses contributions by posts to policy outcomes, examines the quality of post management and sets priorities for the coming year. Post evaluation also provides valuable input into the Senior Executive's appraisal of the performance of individual heads of mission and post.

A key element of post evaluation is to incorporate the views of other departments and agencies with which posts work closely. Strategic-level assessments of posts' performance in pursuing the Government's policy objectives are sought; feedback on operational issues is also welcome. Written feedback from 29 departments and agencies was received for the 2003–04 post assessment period. Comments provided by agencies were very positive overall, indicating that posts were meeting whole-of-government objectives.

Evaluation of performance of state offices

As with posts, state and territory offices are subject to a performance review at the end of each financial year. Office evaluation reporting focuses on key areas including support to ministers, liaison with the local consular corps, business liaison programs and trade advocacy and outreach activities, as well as areas such as assistance with major meetings, notarial services and office administration.

Post liaison visits

In 2003–04, deputy secretaries led small teams to conduct post liaison visits at eleven posts. The annual program of post liaison visits allows us to assess at first hand post performance against agreed objectives and enables staff and their families to raise any concerns they may have. The visits also provide an opportunity to assess whether posts are appropriately staffed and resourced.

Internal audit

The Audit Committee has governance responsibility in the department for internal and external audit. It guides and reviews our audit program to ensure that an effective assurance and control framework is maintained, and the department complies with its legislative and other obligations.

We completed business-assurance focused audits covering:

We completed audits at six overseas posts covering a range of compliance and performance elements. In addition, nine desk audits of overseas posts were carried out from Canberra. These audits revealed a generally improving trend in the standard of financial management and administration, which may be attributable to the department's evolving control self-assessment approach to management. All findings and recommendations were dealt with promptly by the audited posts.

Risk management and business continuity planning

The Audit Committee also has governance responsibility for risk management and business continuity planning. In 2003–04 the department undertook a comprehensive update of its risk management plan, developing improved outreach, training and review mechanisms with assistance from Comcover. We also finalised a business continuity plan for the department to ensure critical functionality in the event of a major emergency affecting our core operations.

Conduct and ethics

An Australian Public Service (APS)-wide survey in 2003, conducted by the Australian Public Service Commission (APSC), found that departmental staff were among the best informed on APS values and code of conduct. The department continued to work hard to build on strong staff awareness of ethics and conduct issues.

The Conduct and Ethics Unit conducted investigations as required. The department again recorded low levels of reported fraud and misconduct. The Unit continued its extensive outreach activities, including mandatory ethics training for all staff on pre-posting training and for lateral recruits and graduate and administrative trainees. Conduct and ethics awareness was a component of other staff development and management courses, such as the Overseas Financial Management Course and Regional Management Conferences. Training was delivered to staff in the Brisbane and Darwin state offices.

The department made available to all staff the publications APS values and code of conduct in practice and Embedding the APS values, which were issued by the Australian Public Service Commission.

A new chapter, 'Conduct and ethical behaviour', was added to the department's human resources manual. The new chapter brings together information regarding the APS values and code of conduct with departmental-specific policy guidance on issues such as procedures for dealing with gifts, benefits and hospitality, SES Returns of Private Interests, offers of sponsored travel and diplomatic and consular privileges.

The department was the first of six agencies to participate in the APSC's evaluation of the management of suspected breaches of the APS code of conduct, foreshadowed in the 2002–03 State of the service report. The evaluation will help the APSC produce a good practice guide in 2005.

Fraud measures

The department complies with the Government's fraud control guidelines and has in place a fraud control plan developed in 2003. Departmental investigators with primary responsibility for fraud control have mandatory qualifications.

Management of corporate records

The department recognises that good record keeping is an essential enabler in its corporate governance and critical to its accountability. In 2002–03, the department convened a Records Management Task Force to review the state of paper and electronic record keeping in the department. Acting on the recommendations of that task force, the department strengthened its management of corporate records during the year by bringing responsibility for record keeping issues into a new Information Resources Branch, established to give greater focus to a range of information functions. In February 2004, we established a new specialist position (at Executive Level 2) to advise on all aspects of record keeping policies and practices. We conducted a request for tender to select a panel of service providers to help us over the next three years to improve our record keeping capacity and performance across both paper and electronic records.



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Department of Foreign Affairs and Trade Annual Report 2003–2004
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