(1) This Policy sets out the framework for the governance and oversight of University of Wollongong (UOW) controlled entities to ensure compliance with the University of Wollongong Act 1989 (the UOW Act) and other relevant legislation and higher education governance standards. (2) This Policy: (3) The implementation of this Policy will facilitate good governance and assist the University Council (Council) to meet its responsibilities under the University of Wollongong Act 1989 in relation to controlled entities. It clarifies the interface between the University and controlled entities, including the requirements attaching to transactions between the University and a controlled entity, the role of controlled entities within the University’s legislative compliance framework and risk management framework, and reporting by controlled entities to the University. (4) This Policy covers the lifespan of UOW controlled entities, from their establishment to winding up or disposal, and includes controlled entity reporting, monitoring and transactions. (5) This Policy applies to new controlled entities and existing controlled entities of UOW as at the approval date that meet the definition of a controlled entity (see Definitions above), whether in Australia or overseas. (6) If there is any inconsistency between this policy and any agreement relating to a controlled entity, advice should be sought from the Office of General Counsel or the Governance Unit. (7) Except to the extent that a contrary intention is expressed, this policy binds the University, controlled entities, and their employees. (8) Where a controlled entity is a Subsidiary within a holding company structure, the Subsidiary is taken to have complied with this Policy if its Holding Company has satisfied the requirements of this Policy on behalf of the Subsidiary. (9) UOW may establish controlled entities, both within Australia and offshore, to conduct activities within the scope of UOW’s statutory functions, where there are sound business, education or research reasons for doing so. (10) Under the UOW Act, the University Council (Council) is responsible for the monitoring and oversight of the functions, governance and activities of UOW controlled entities. (11) To enable Council to discharge its responsibilities, there must be appropriate governance, financial and operational frameworks in place for controlled entities. (12) UOW will ensure that Council meets its responsibilities relating to controlled entities under: (13) As far as possible, and having regard to the size, objects, nature and complexity of the controlled entity in question, UOW will apply a consistent approach to controlled entities, including in relation to: (14) When considering the establishment of a controlled entity, the University must take into account how decisions will be made, particularly if a majority of the directors on the controlled entity board are University staff. (15) Controlled entities are those entities over which UOW has control. UOW has control over an entity when it is exposed, or has rights, to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Power over the entity exists when UOW has existing rights to direct the relevant activities of the entity. The specific facts and circumstances of each entity must be considered. The following are examples of circumstances in which an entity will be considered to be a controlled entity of the University: (16) Other circumstances may be relevant to the issue of control and where there is doubt the Chief Operating Officer and Vice-President Operations shall determine whether the entity is controlled by the University, based on advice from the General Counsel, the Chief Governance Officer and Secretary to Council and Chief Financial Officer that takes into account relevant matters including the view of the Risk and Assurance Division. (17) The approval of Council is required to establish a controlled entity. The process described in this section must be followed. (18) Staff must not commit the University to any contracts or other legally binding commitments before Council grants approval to establish the controlled entity, except for the engagement of legal and tax advice through the Office of General Counsel or the Financial Services Division (as applicable), in relation to a proposal. (19) When acquiring an interest in an existing entity where the acquisition would give the University a controlling interest in the entity, whether in Australia or overseas, advice regarding the application of this Policy must be sought from the Chief Operating Officer and Vice-President Operations who will consult with the Office of General Counsel for legal advice as necessary. (20) Generally, the reasons for which UOW may wish to establish a controlled entity include the following: (21) If these or similar reasons are not met, a controlled entity will not be established. (22) When a new controlled entity is proposed, the Proposer (see Definitions) will prepare a brief written proposal with a request for in principle approval to proceed with the controlled entity business case. The proposal must address, at a minimum, points a), c), g) , h) and n) of Appendix A: Checklist of business case items required to consider the establishment of a controlled entity. (23) If the Vice-Chancellor and President and the Chief Operating Officer and Vice-President Operations provide in principle approval of the proposal, the proposer will prepare a detailed written business case. (24) The proposer must prepare a detailed written business case addressing each point set out in Appendix A and arrange a briefing session for the reviewers. The business case and all supporting documentation (e.g. draft constitution, business plan, initial budget and cashflow forecast) will be reviewed by the following staff, who will provide feedback based on their expertise: (25) Depending on the core subject matter, the proposal will also be reviewed by one or more appropriate members of the Senior Executive (e.g., Deputy Vice-Chancellor (Research and Sustainable Futures) (or nominee) for research and enterprise proposals). (26) The business case and comments from the reviewers will then be submitted to the Vice-Chancellor and President. (27) Where the Vice-Chancellor and President supports the establishment of the controlled entity, the business case will be submitted via the Finance and Infrastructure Committee to Council for approval. (28) Where the controlled entity is a joint venture between the University and one or more other parties, the joint venture agreement should be consistent with the UOW’s statutory obligations and the requirements of this Policy. If any departure from these requirements are thought to be necessary for commercial reasons, advice from the Office of General Counsel must be obtained. (29) At all stages of the proposal, evaluation and approval process, UOW staff and Council members must ensure that their decisions and actions are not affected or influenced by actual, perceived or potential conflicts of interest. Conflicts of interest must be disclosed and managed in accordance with the Conflict of Interest Policy. (30) The constitution of a wholly owned controlled entity established after the effective date of this Policy (new controlled entity) must: (31) Where the entity is an offshore entity, the constitution must be reviewed by a legal practitioner in the relevant jurisdiction to ensure that local legal requirements are satisfied. (32) In the case of wholly owned controlled entities existing at the effective date of this Policy (existing controlled entities), the applicable UOW Senior Executive Member appointed by the Vice-Chancellor and President is responsible for: (33) The Board of a controlled entity must: (34) The Vice-Chancellor and President must be consulted prior to the nomination of any appointed director of a controlled entity. (35) The Board of a controlled entity must, or where a controlled entity has subsidiaries, the board of the holding company must for the controlled entity and its subsidiaries: (36) A controlled entity must, or where a controlled entity has subsidiaries, the Board of the holding company must for the controlled entity and its Subsidiaries: (37) A controlled entity that provides educational services in collaboration with the University or on the University’s behalf to offer a Higher Education Award or Pathway Program, for example under a third-party arrangement within the meaning of the Higher Education Standards Framework (Threshold Standards) 2021, must: (38) A controlled entity that provides educational services in collaboration with UOW or on UOW’s behalf to offer a CRICOS registered and/or UOW badged non-award offering, for example under a third-party arrangement, must comply with the relevant requirements of the Collaborative Delivery of a UOW Course Policy regarding the delivery of educational services, including processes for approval of delivery, monitoring and review of educational delivery, quality assurance of delivery and other relevant matters (39) A controlled entity must formally notify the Vice-Chancellor and President, Applicable UOW Senior Executive Member and the Chief Risk and Assurance Officer in writing immediately (and in all cases no later than 72 hours after) it becomes aware of circumstances or events with the potential to adversely impact UOW’s standing and reputation and/or the viability (including solvency) of the controlled entity and that have a high probability of occurring. (40) A controlled entity must comply with the requirements of the Reporting Protocol set out in Appendix B and discussed in the following sections. Council may amend the reporting protocol at its discretion and independently of the policy review process. (41) A controlled entity must submit an annual business plan that reflects and aligns with the strategic plan for the controlled entity and provide periodic updates in accordance with the reporting protocol (see Appendix B). (42) The controlled entity will be required to comply with the management and statutory reporting requirements communicated by UOW Financial Services to fulfil internal and external financial reporting obligations. This is in addition to any reporting requirements applicable to an offshore controlled entity in its own jurisdiction. (43) In consultation with the Chief Financial Officer, ensure the timing of financial reporting aligns with UOW financial reporting and budget setting timeframes as far as possible. (44) Ensure any matter involving the payment of taxes and other levies is discussed wth UOW Financial Services Division and it approved by Chief Operating Officer and Vice-President Operations. (45) The Board of each controlled entity will be required to annually certify to the UOW Risk, Audit and Compliance Committee that in respect of the reporting period the entity: (46) A controlled entity will be required to comply with requirements prescribed by the University for the conduct of “commercial activities” (as defined by the University of Wollongong Act 1989), including reporting requirements. (47) Council or the Risk, Audit and Compliance Committee may request additional reports to those specified in the reporting protocol from time to time. (48) Winding-up a solvent controlled entity is a process whereby the company's outstanding business is finalised, its assets are liquidated, and outstanding debts are paid. (49) The disposal sale of a controlled entity must be approved by Council. Disposal includes sale, transfer or surrender, with or without consideration. (50) A proposal will be produced that sets out the reasons for the proposed disposal, including all relevant financial and other information, to enable the Vice-Chancellor and President to make a recommendation to Council regarding the disposal. (51) The University Council is responsible for the approval of the establishment, winding up and disposing of controlled entities and is required to monitor and oversee of the functions, governance and activities of UOW Controlled Entities in accordance with relevant legislation and with the Voluntary Code of Best Practice for the Governance of Australian Public Universities. (52) The Risk, Audit and Compliance Committee monitors controlled entities by ensuring effective risk and safety management through an appropriate risk management plan, reviews evidence and assurance of effective legislative compliance management and receives and reviews risk and financial reports in accordance with the Reporting Protocol at Appendix B. (53) The Vice-Chancellor and President and UOW Senior Executive are responsible for reviewing business cases for new controlled entities, proposed strategic and risk management plans for controlled entities and proposals for the wind-up or disposal of controlled entities. (54) The Applicable UOW Senior Executive Member is responsible for being the main channel of communication between the Board of those controlled entities, the Vice-Chancellor and President and the UOW Senior Executive. (55) The Vice-Chancellor and President is responsible for oversight of processes relating to the establishment, winding up and disposal of Controlled Entities and, specifically, will approve any remuneration requests for controlled entity board members. (56) The Chief Operating Officer and Vice-President Operations is responsible for determining whether an entity is a controlled entity for receiving preliminary proposals and business cases for new controlled entities (with the Vice-Chancellor and President) and providing in principle approval before submitting full proposals to the Vice-Chancellor and President and UOW Senior Executive and the Council. (57) The Chief Governance Officer and Secretary to Council is responsible for providing advice to the Chief Operating Officer and Vice-President Operations as to whether an entity is a controlled entity and for ensuring controlled entity assurance information is included in the Council's annual assessment of the University’s compliance with the Voluntary Code of Best Practice for the Governance of Australian Public Universities. (58) The Chief Risk and Assurance Officer is responsible for providing advice in relation to controlled entity risk management plans and processes and receiving and reviewing reports from controlled entities in their portfolio areas regarding circumstances or events with the potential to adversely impact UOW’s standing and reputation and/or the viability (including solvency) of the controlled entity and that have a high probability of occurring. (59) The Chief Financial Officer is responsible for providing advice to the Chief Operating Officer and Vice-President Operations about whether an entity is a controlled entity, reviewing and advising UOW on the financial aspects of proposals to establish, wind-up or dispose of a controlled entity and for advising controlled entities in relation to insurance provisions and financial reporting. (60) The Office of General Counsel is responsible for providing legal advice to the University regarding the establishment, operation, winding up and disposal of UOW controlled entities. (61) All UOW staff members are responsible for complying with this policy. (62) A business case to support the establishment of a controlled entity must address the following points: (63) Controlled entities are required to comply with the following Reporting Protocol unless Council or its Delegate determine that specific controlled entities will be subject to a modified Reporting Protocol, considering the size, operations and risks relevant to the controlled entity:Controlled Entity Policy
Section 1 - Purpose of Policy
Section 2 - Application and Scope - Exclusions or Special Conditions
Section 3 - Policy Principles
Section 4 - What is a Controlled Entity?
Section 5 - Establishing a Controlled Entity
Reasons for Establishing a Controlled Entity
Process for Establishing a Controlled Entity
Preliminary Proposal
Business Case
Section 6 - Joint Venture Agreements
Section 7 - The Constitution of a Wholly Owned Controlled Entity
Top of PageSection 8 - The Board of a Controlled Entity
Section 9 - Obligations of a Board of a Controlled Entity
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Section 10 - Management of a Controlled Entity
Provision of Educational Services by a Controlled Entity
Section 11 - Reporting Requirements
Notifications to the University
Reporting Protocol
Business Plan
Financial Reporting
Legislative Compliance Certification
Commercial Activities Reporting
Other Reporting
Section 12 - Voluntary Winding Up of a Controlled Entity
Top of Page
Section 13 - Disposal of a Controlled Entity
Section 14 - Roles and Responsibilities
Section 15 - Appendix A
Checklist of Business Case Items Required to Consider Establishing a Controlled Entity
Top of Page
Section 16 - Appendix B: Reporting Protocol
Top of Page
Section 17 - Definitions
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Time frame
What is required
Notes
Annually
Business Plan for next financial year and updated objectives and KPIs to Council.
Quarterly
Quarterly Report against the Business Plan to Council.
See Section 11 above
Quarterly
Controlled Entity risk committee minutes to be provided to the UOW Risk, Audit and Compliance Committee
Risk Management Framework
Annually
Controlled Entity risk committee report to the UOW Risk, Audit and Compliance Committee including legislative compliance attestation
Annually
Financial Reporting (including audited accounts) to Council via Risk, Audit and Compliance Committee.
As Required
Commercial Activities Reporting to the Applicable Senior Executive Member
As Required
Immediate notification to the Applicable Senior Executive Member and Chief Risk and Assurance Officer of circumstances or events with the potential to adversely impact UOW’s standing and reputation and/or the viability (including solvency) of the Controlled Entity with reporting through to the Risk, Audit and Compliance Committee and Council.
See Section 11 above
Word/Term
Definition (with examples if required)
Applicable UOW Senior Executive Member
The UOW Senior Executive consists of the following members:
- Vice-Chancellor and President
- Senior Deputy Vice-Chancellor (Innovation, Enterprise and External Relations)
- Deputy Vice-Chancellor and Vice-President (Academic and Student Life)
- Deputy Vice-Chancellor (Research and Sustainable Futures)
- Deputy Vice-Chancellor (Strategy and Assurance)
- UOW Global Enterprises Group CEO and Managing Director
- Chief Operating Officer and Vice-President Operations
- Executive Deans
The applicable UOW Senior Executive Member is the representative officer designated by the Vice-Chancellor and President to act as the main channel of communication between the Board of the Controlled Entity and the Vice-Chancellor and President and UOW Senior Executive.
Commercial Activity
Commercial Activities are defined under the University of Wollongong Act 1989 (section 20A) as:
(a) any activity engaged in by or on behalf of the University in the exercise of commercial functions of the University; and
(b) any other activity comprising the promotion of, establishment of or participation in any partnership, trust, company or other incorporated body, or joint venture, by or on behalf of the University, that is for the time being declared by the Guidelines to be a University commercial activity.
Under the University of Wollongong Act 1989 (section 5(3)(a)) commercial functions comprise “commercial exploitation or development, for the University’s benefit, of any facility, resource or property of the University or in which the University has a right or interest (including, for example, study, research, knowledge and intellectual property and the practical application of study, research, knowledge and intellectual property), whether alone or with others,”.
Controlled Entity
Controlled Entities are those entities over which UOW has control, as defined in section 15A of the University of Wollongong Act 1989 (as amended) and section 1.2(1) of the Government Sector Finance Act 2018.
Delegate
Person or group of persons set out in the Delegations of Authority Policy with delegated authority to perform specific functions.
Higher Education Award
A higher education award is defined in section 4 of the Tertiary Education Quality and Standards Agency Act 2011 and includes a qualification covered by level 5, 6, 7, 8, 9 or 10 of the Australian Qualifications Framework other than an award offered or conferred for the completion of a vocational education and training course.
Holding Company
Has the meaning given in section 9 of the Corporations Act 2001.
Independent Director
A director who is free of any interest, position or relationship that might influence, or reasonably be perceived to influence, in a material respect their capacity to bring an independent judgement to bear on issues before the Board.
Members of Council or staff or students of the University are not considered to be independent for the purposes of Controlled Entity boards.
Proposer
The staff member putting forward a proposal to establish a Controlled Entity. The Proposer must be at the level of Executive Dean or above.
Subsidiary
Has the meaning given in section 46 of the Corporations Act 2001.