Corporate governance

The department's achievement of its performance outcomes is underpinned by a robust institutional governance framework.

The Executive

The Secretary oversaw all significant foreign and trade policy and corporate management issues and decided placements of senior executive staff. The deputy secretaries supported the Secretary through management of the department's work units.(See Figure 1, for the executive structure and the deputy secretaries' areas of responsibility.) Members of the executive also represented the government at meetings in Australia and overseas and chaired key corporate governance bodies.

Senior management committees and their roles

Portfolio coordination

As the lead agency in the foreign affairs and trade portfolio, the department worked closely with portfolio agencies to coordinate objectives and ensure consistency. The department held routine consultations with AusAID, Austrade, ASIS and ACIAR at the executive and working levels.

The department worked with AusAID and central agencies, including through the Development Effectiveness Steering Committee, to support the government's ongoing commitment to increase levels of development assistance to 0.5 per cent of Gross National Income.

Whole-of-government coordination

The Prime Minister's Directive: Guidelines for the Management of the Australian Government Presence Overseas sets out the department's leading coordination role, including for the growing number of other government agency representatives attached to our diplomatic missions. The department worked closely with agencies to achieve whole-of-government objectives, including in hosting and participating in major international meetings, in responding to consular crises, in building and maintaining regional cooperation on issues such as counter-terrorism and people smuggling, and in coordinating policy approaches to bilateral and multilateral trade negotiations.

The Secretary and executive met senior officers from other Australian government departments and agencies regularly to coordinate whole-of-government approaches to current and emerging foreign and trade policy matters, as well as shared management challenges.

Management mechanisms

The department maintains a structure of management bodies and meetings designed to: share information; provide robust corporate governance; convey priorities; and embed strong and ethical organisational values.

The departmental executive (DE)—comprising the senior executive, the head of Corporate Management Division, the Chief Financial Officer, the Chief Information Officer and representatives from the senior executive service (SES)—is the department's major formal management body. Meeting weekly, the DE focuses on strategic resource management and priorities, including the budget and cross-cutting policy matters requiring high-level attention. The DE also oversees the Budget Allocation Review (BAR) and Capital Management Plan (CMP) processes, which address six-monthly, unavoidable resourcing bids from posts and work areas. The DE evaluates performance and discusses the priority and challenges for overseas and state and territory offices. Evaluation of divisions is undertaken directly by the senior executive. (See also Evaluation and planning)

The following committees, chaired at deputy secretary-level, support the DE.

The Audit and Risk Committee provides independent assurance on the department's risk, control and compliance framework and its external accountability responsibilities. In 2012–13, the committee met five times. It considered a range of completed external and internal audits, reports and reviews on cyber security, ICT access and security controls, the Windows 7 rollout, recordkeeping and management, accountable documents inspections and a performance audit of travellers' emergency loans.

The Workplace Relations Committee considers ways to improve the quality of the department's work environment and address matters of employment concern, including those arising from the implementation and operation of the department's current Enterprise Agreement 2011–14. Membership includes representatives from management areas and elected staff representatives at each level. The Community and Public Sector Union, the Australian Manufacturing Workers' Union, the Media, Entertainment and Arts Alliance and the Association of Foreign Affairs and Trade Employees are also represented. In 2012–13, the committee met four times and focused on issues ranging from recruitment of specialists, postings and placements processes, conditions of service, performance management, parking, and the impact of the budget.

The Ethics Committee oversees and makes recommendations on the development and implementation of the department's conduct and ethics policies. The committee met once during 2012–13 to make recommendations on development and implementation issues relating to the APS Values and APS Code of Conduct. The department's Conduct and Ethics Manual, which is regularly updated, is available on the departmental website at http://www.dfat.gov.au/publications/conduct-ethics/index.html.

The DE and the above committees are supported by other subject-specific committees and taskforces, including:

  • Indigenous Task Force
  • Business Continuity Task Force
  • ICT Strategy Committee
  • International Communications Network Program Board
  • Passports Redevelopment Program Sponsor Group
  • SAP Development Program Sponsor Group.

Intradepartmental communication

The Secretary communicated with departmental staff through the following mechanisms:

  • weekly meetings with division heads to communicate the department's foreign and trade policy and corporate priorities
  • administrative circulars and the department's intranet
  • regular meetings with relevant senior officers to discuss policy, staffing, budget and other corporate management issues
  • regular forums open to all staff to discuss policy and corporate issues affecting the department (transcripts of these forums are made available to all staff in Australia and overseas)
  • regular meetings with divisions, on a rolling basis, to discuss policy and corporate issues
  • circulation to all staff of public speeches made by the Secretary
  • staff policy forums on selected policy issues, chaired by the Secretary or a senior departmental officer on a rotational basis.

The overseas network was informed of policy and corporate issues through:

  • regular formal and informal communication with divisions in Canberra
  • regional heads of mission/post meetings
  • video conferences between the Secretary and some overseas posts
  • regional management conferences
  • post liaison visits led by a deputy secretary.

Evaluation and planning

Our performance was regularly evaluated to ensure departmental resources were best directed to support the government's foreign and trade policy objectives.

Performance expectations and planned use of resources were outlined in our Portfolio Budget Statements. The department updated its deliverables and key performance indicators for the Portfolio Budget Statements 2013–14 to ensure they closely aligned with Australia's current international priorities.

Divisional evaluation reviews, conducted on a rolling basis throughout 2012–13, enabled the executive to evaluate each division's performance and to determine or refine priorities for the year ahead.

The department evaluated the performance of posts and state and territory offices (PER/OER), on a rolling basis (each post and office is reviewed once every 18 months). The department sought feedback from other agencies and departments on the performance of our posts and state and territory offices as part of the review process. One OER and 47 PERs were discussed at the regular DE meeting with the relevant state director and heads of mission present.

In 2012–13, deputy secretaries led post liason visits to Kabul, Taipei, Athens and New York to assess at first hand each post's performance against agreed objectives.

The Budget Allocation Review (BAR) and Capital Management Plan (CMP) are the primary mechanisms through which the executive considers and decides on budget supplementation within the department. Work units in Australia and overseas are able to bid for additional funds annually and mid-term through these reviews. The reviews allow for strong budget planning and expenditure forecasting, and ensure internal processes align with the government's budget timetable. BAR/CMP meetings this year were held in November 2012 and May 2013 for 2012–13 and 2013–14 budget allocations. The base budget for work areas was put to the DE as part of the June BAR/CMP process.

Then Deputy Secretary Bruce Gosper (right) leading the post liaison visit to Kabul, July 2012. Team members (left to right): Paul Wood (AusAID); Barry Jackson (Overseas Property Office); Bryce Hutchesson (Executive Branch); and Mal Skelly (Corporate Management Division). [DFAT]

Then Deputy Secretary Bruce Gosper (right) leading the post liaison visit to Kabul, July 2012. Team members (left to right): Paul Wood (AusAID); Barry Jackson (Overseas Property Office); Bryce Hutchesson (Executive Branch); and Mal Skelly (Corporate Management Division). [DFAT]

 

Conduct and ethics

The department's Conduct and Ethics Unit (CEU) investigates allegations of fraud and misconduct. Out of five allegations of fraud against DFAT officers in 2012–13, only one minor case relating to an LES member was substantiated.

The CEU also promotes the APS Values, APS Code of Conduct and the department's own Code of Conduct for Overseas Service. It provides conduct and ethics and fraud awareness training to all staff, including pre-posting briefings on overseas conduct and ethics issues for heads of mission, deputy heads of mission and senior administrative officers.

During 2012–13, the CEU introduced two mandatory e-learning modules specifically designed to increase access to training on APS values, ethical behaviour and accountable decision-making for all staff in Australia and overseas.

Countering fraud

The department's fraud prevention, investigation, reporting and data collection procedures comply with the Commonwealth Fraud Control Guidelines and the Australian Government Investigation Standards. The department's Fraud Control Plan (FCP) emphasises the department's zero tolerance policy for dishonest or fraudulent behaviour by employees, contractors or clients, and underlines the department's strong commitment to reducing the risk and incidence of fraud across its operations both within Australia and overseas. The FCP 2011 underwent a process of mandated biennial review in 2013. As part of the department's commitment to fraud prevention and detection, and in accordance with the FCP, areas of the department that manage functions more prone to fraud risks reviewed the risks of their functions and the effectiveness of the control systems in place.

Certification of compliance with the commonwealth fraud control guidelines

Risk management and business continuity planning

In 2012–13, the department's risk management practices were further embedded across the department. We conducted a series of outreach sessions to raise awareness of risk management policies and processes and produced a comprehensive training module that has been integrated into the department's general management courses. We issued a revised departmental Risk Management Handbook to assist staff to identify, categorise, treat and monitor risks within their respective areas. In the 2013 Comcover Risk Management Benchmarking Survey, the department achieved its best result to date with the highest possible rating for its business continuity and disaster recovery policies and processes.

We continued to strengthen the department's business continuity planning processes in Canberra, at state and territory offices and across our diplomatic network. In particular, the department focused on improved business continuity management (BCM), taking account of lessons learned from an August 2012 desktop exercise of the RG Casey Building Business Continuity Plan (BCP). We developed an enhanced communication strategy to ensure provision of more efficient and systemic information about business continuity events to key stakeholders. We raised staff awareness of the RG Casey Building BCP by updating the plan on the department's intranet and through presentations to staff. BCPs for our overseas posts and state and territory offices were tested, updated and checked for inclusion of new requirements related to ICT and security.

Regulatory practice

The department provided comment on the government's revised Best Practice Regulation Handbook which changes the way new regulations, such as sanctions and free trade agreements, are assessed for their impact on business and the community. We also participated in interdepartmental consultations, as part of the Commonwealth's regulatory reforms, to improve how regulatory change is communicated to the public, including through the department's annual regulatory plan.

Internal audit

Internal audit forms an important part of the department's governance framework by contributing to governance, risk management and control. Internal audits presented to the Audit and Risk Committee in 2012–13 included:

  • eight post compliance audits
  • one state office compliance audit
  • reporting of inspections of accountable Cabinet documents (a quarterly requirement)
  • an internal control audit on travellers' emergency loans
  • an internal control audit on compliance with legislated spending approval requirements (Financial Management and Accountability Act 1997, Regulations 9 and 10).

Audits commenced in the latter part of the financial year will be finalised in early 2013–14. All recommendations arising from these audits were either satisfactorily addressed during the year or are in the process of being addressed.