Structure and composition of the Board
Wesfarmers is committed to ensuring that the composition of the Board continues to include directors who collectively bring an appropriate mix of skills, commitment, experience, expertise and diversity (including gender diversity) to Board decision-making.
The Board currently comprises nine directors, including eight non-executive and independent directors. Details of the directors, including their qualifications and date of appointment are set out below. Detailed biographies of the directors as at 30 June 2020 are set out on pages 80 and 81 of the company’s 2020 annual report.
Tony Howarth retired as a non-executive director at the end of the 2019 Annual General Meeting on 14 November 2019 after serving as a director for 12 years.
The Board is of the view that the tenure profile, represented by the length of service of each of its directors, is appropriately balanced such that Board succession and renewal planning is managed over the medium to longer term. The Board is of the view that the current directors possess an appropriate mix of skills, commitment, experience, expertise (including knowledge of the Group and the relevant industries in which the Group operates) and diversity to enable the Board to discharge its responsibilities effectively and deliver the company’s strategic priorities as a diversified corporation with current businesses operating in home improvement; apparel; general merchandise and office supplies; and businesses in chemicals, energy and fertilisers, and industrial and safety products.
The Board skills matrix, describes the combined skills, experience and expertise presently represented on the Board. To the extent that any skills are not directly represented on the Board, they are augmented through management and external advisors. This may be viewed on page 5 of the 2020 Corporate Governance Statement.
David Cheesewright who has extensive experience in international retailing and manufacturing, including 19 years with Walmart, was appointed as an advisor to the Wesfarmers Board in August 2018.
Directors are expected to bring views and judgement to Board deliberations that are independent of management and free of any interest, position, association, business or other relationship or circumstance that could materially interfere with the exercise of objective, unfettered or independent judgement, having regard to the best interests of the company as a whole.
Each non-executive director is required to notify the Chairman prior to accepting an invitation to become a director of any other company. In considering the new appointment, the Chairman is to consider:
- the terms of Wesfarmers’ Conflicts of Interest Policy; and
- the time commitment required of the director to properly exercise his or her powers and discharge his or her duties as a director of Wesfarmers and member of any Board committees.
An independent director is a non-executive director who is not a member of management and who is free of any interest, position, association, business or other relationship that could influence, or could reasonably be perceived to influence, the independent exercise of their judgement.
The Board regularly assesses the independence of each non-executive director in light of the information which each director is required to disclose in relation to any material contract or other relationship with Wesfarmers in accordance with the director’s terms of appointment, the Corporations Act 2001, the Board Charter and Wesfarmers’ Conflicts of Interest Policy. Each non-executive director may be involved with other companies or professional firms which may from time to time have dealings with Wesfarmers. Details of some of the offices held by directors with other organisations are set out on pages 80 and 81 of the company’s 2020 annual report and on the company’s website at www.wesfarmers.com.au/cg.
The Board considers any changes to each non-executive director’s interests, positions, associations or relationships that could bear upon his or her independence. The Board’s assessment of independence and the criteria against which it determines the materiality of any facts, information or circumstances is formed having regard to the ASX Principles. In particular, the Board focuses on the factors relevant to assessing the independence of a director set out in recommendation 2.3 of the ASX Principles and the materiality guidelines applied in accordance with Australian Accounting Standards.
The Board considers that a relationship could influence, or could reasonably be perceived to influence, a director’s independent judgement, where it is of such substance and consequence that there is a real and sensible possibility that it would affect the director’s judgement.
The Board has reviewed the position and relationships of all directors in office as at the date of the company’s 2020 annual report and considers that all eight non-executive directors are independent.