The body has put forward two policy proposals calling for listed entities to regularly assess their culture and disclose their actions, with the condition that if companies do not set a reasonable time frame or their targets don’t improve gender diversity by 2025, regulatory intervention should occur.
Gender balance refers to a minimum of 40 per cent of either gender, ACSI said, with 20 per cent leeway to allow flexibility for appropriate renewal.
The ACSI has backed the ASX Corporate Governance Council’s recommendations that entities articulate and disclose their values, as well as disclose codes of conduct and whistleblowing, bribery and corruption policies.
But it said in addition, boards should conduct their own culture assessments to identify and address issues, ACSI said, with the recommendations of the banking royal commission being relevant across the market, not just in the financial services sector.
“It is widely accepted that poor culture is a key contributor to major behavioural and governance failings, which harm investors, consumers and markets,” Louise Davidson, chief executive, ACSI said.
“Australia’s response to cultural failings has traditionally been reactive, happening only after significant consumer and investor harm has occurred. Our proposals would focus companies on the risks and opportunities associated with their corporate culture.”
The suggestions from the ACSI is part of a larger policy agenda it released in the lead up to its annual conference, which includes bids to improve corporate accountability, culture and diversity, and stewardship.
