Corporate governance
Challenger's approach to Corporate GovernanceThe Board and management of Challenger recognise their duties and obligations to stakeholders to implement and maintain a robust system of corporate governance. Challenger believes that the adoption of good corporate governance adds value to stakeholders and enhances investor confidence.
The Board is accountable for Challenger performance and overseeing the development of sustainable shareholder value within an appropriate framework of risk management and regard for all stakeholder interests. The Board has identified the key functions which it has reserved for itself. These functions are outlined in the Board Charter.
The Board has delegated to the CEO the authority and powers necessary to implement the strategies approved by the Board and to manage the business affairs of Challenger within the policies and specific delegation limits specified by the Board from time to time. The CEO remains accountable for all authority delegated to management.
To assist it in undertaking its duties, the Board has established the following committees:
- the Group Audit and Compliance Committee
- the Nomination Committee
- the Remuneration Committee
Risk Management and Compliance
The management of risks is fundamental to the Company's business and to building shareholder value. The Board recognises the broad range of risks which apply to Challenger as a participant in the financial services industry, including, but not limited to, market risk, funding and liquidity risk, credit risk, investment, strategic and business risk, reputation, licence (compliance) and operational risk. The Board is responsible for determining the Group's risk management strategy. Management is responsible for implementing the Board's strategy and for developing policies and procedures to identify, manage and mitigate risks across the whole of the Group's operations.
The key design component of Challenger's approach to risk management is that all the heads of business units have accountability for managing the risks within their divisions in line with the Group's risk management framework with oversight, analysis, monitoring and reporting of these risks by executives who are independent of the business units and are responsible to the CEO and the Board or its Committees.
Code of Conduct
The Board has adopted a Code of Conduct which applies to all Directors, executives, management and employees of the Company and its subsidiaries. The Code articulates the standards of honest, ethical and law-abiding behaviour expected by the Company. Employees are actively encouraged to bring any problems to the attention of management or the Board, including activities or behaviour which may not comply with the Code of Conduct, other policies and procedures in place, or other regulatory requirements or laws.
Directors and staff trading policy
Directors and staff are subject to restrictions under the law relating to dealing in securities, including the securities issued by the Company, if they are in possession of insider information. The Board has approved the Group's Staff Trading Policy which prescribes the manner in which staff can trade in the Company's shares. Challenger prohibits any Director or staff member from trading in derivatives in respect of Challenger shares or other listed Challenger financial products. Challenger prohibits Directors and staff members margin lending over Challenger shares. The Staff Trading Policy also sets out measures to manage actual and perceived conflicts of interest relating to personal dealing. Those staff designated as potentially having access to insider information are required to seek prior approval to trade in other securities.
Integrity of Financial Reporting
The Board has the responsibility to ensure truthful presentation of the Company's financial position. The Board has established an Audit and Compliance Committee to assist the Board to focus on issues relevant to the integrity of the Group's financial reporting. In accordance with its Charter, the Audit and Compliance Committee must have at least three members and is comprised of all Non-Executive Directors and a majority of independent members. The Committee is chaired by an Independent Director, who is not Chair of the Board.
Continuous Disclosure
The Company is committed to ensuring all investors have equal and timely access to material information concerning the Company and that Company announcements are factual and presented in a clear and objective manner. The Board has approved and implemented a Continuous Disclosure Policy. The policy is designed to ensure compliance with the Corporations Act and ASX Listing Rules continuous disclosure requirements.
