vic_logo

Guide to public entity board governance

The minimum standards of good governance that all Victorian Government boards, statutory bodies and advisory committees are expected to meet.

‘Boards’ is a generic term for the governing body of a non-departmental entity. This can also include:

  • authorities
  • committees
  • councils

This information applies to the boards of non-departmental entities:

  • that are established by or under an Act (including the State Owned Enterprises Act 1992 and the Corporations Act 2001)
  • that are established by Governor in Council, by a Minister or by a Secretary of a Victorian Government department
  • where the right to appoint at least one half of the directors is vested in the state
  • that exercise a public function, which is not judicial or quasi-judicial, on behalf of the state
  • that are wholly owned by the state

This information also applies to departments and non-departmental entities conducting:

  • recruitment and selection of board members
  • induction for board members

If a non-departmental entity, or the department running processes on their behalf, intends to not follow this guidance, the responsible Minister must provide reasons for doing so in the relevant Cabinet submission or in writing to the Premier.

Role of boards

The boards of non-departmental entities help the Victorian Government with:

  • service delivery
  • asset management
  • regulation
  • specialist advice
  • localised governance

Our boards should comply with all relevant frameworks and legislation and exercise their duties to the highest standards.

Role of departments

Refer to the Public Administration Act 2004 for information on the role of departments in:

  • advising ministers on matters relating to public entities
  • working with public entities on matters relating to public administration and governance

Recruitment and selection

Ministers are responsible for board appointments. Cabinet has oversight of significant appointments.

Departments and non-departmental entities should assist with recruitment and selection processes that are:

1. Merit-based

All appointees must be selected on merit.

Ministers should select the strongest candidate for each vacancy, based on a position description that reflects the skills and experience required by the board.

Position descriptions and selection criteria should be developed in accordance with input from the chair of the board.

All chairs must maintain a skills matrix to inform vacancies and assist succession planning.

2. Fair

The selection process must be managed consistently for all candidates. This includes objective assessment against set criteria.

3. Open

Vacancies should be publicly advertised in order to attract a strong and diverse range of suitable candidates.

If a decision is made not to advertise, reasons must be given in the relevant Cabinet submission or in writing to the Premier, before the appointment is finalised.

4. Diverse

Board appointments should broadly mirror the diversity present in Victoria’s communities.

Appointments must comply with the government’s commitment that at least 50% of appointments to paid boards be women.

Refer to the best practice guidance in the Victorian Public Sector Commission's (VPSC) Recruitment and Appointment to the Board (Toolkit).

Appointment and remuneration of board members

Victoria’s standard processes for appointment and remuneration are outlined in the Guidelines on Appointment and Remuneration.

Induction

Induction is essential for all new board members, especially those board members who are new to government boards.

Induction can be conducted by the department or the public entity.

Induction procedures should be in place to allow new board members to participate fully and actively in board decision-making at the earliest opportunity. To be effective, new directors need to have appropriate knowledge of the public entity and the industry within which it operates.

At a minimum, all board members should be provided with:

  • Welcome to the Board – Director’s Guide to Public Entity Governance
  • a code of conduct – either material endorsed by the board and specific to the non-departmental entity or the VPSC's Code of Conduct for Directors
  • a conflict of interest policy and guidance – either material endorsed by the board and specific to the non-departmental entity or the VPSC's Conflict of Interest and Duty Guidance for Directors
  • relevant establishing legislation, Order-in-Council instruments or constituting terms of reference
  • all policies adopted by, or relevant to, the non-departmental entity or the board of the non-departmental entity
  • an accurate overview of the current financial, strategic and operational position of the non-departmental entity
  • a description of the respective roles of, and the relationships between, the entity, the relevant department and the responsible minister
  • if applicable, an understanding of the roles and responsibilities of senior executives

Source: this information was first disseminated in Premier's Circular No. 2015/02 Good Board Governance.

Reviewed 15 April 2019

Contact us

Governance Branch

Was this page helpful?