Annual Report 2007 Territory Insurance Office
Tabled paper 1190
Tabled papers for 10th Assembly 2005 - 2008; Tabled papers; ParliamentNT
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45 In addition, and as a result of changes to the legislation in 2006, TIO provides a report to the Minister within 3 months of the end of the financial year relating to the applicable Statement of Corporate Intent. PRINCIPLE 7: RECOGNISE AND MANAGE RISK ESTABLISH A SOUND SYSTEM OF RISK OVERSIGHT AND MANAGEMENT AND INTERNAL CONTROL. The Board Audit & Risk Committee has responsibility for oversight of TIOs risk management systems and processes. The Committee has adopted a Risk Management Framework, based on the Australian Standard, setting out the policies and procedures for risk management, assessment criteria and tolerance (or acceptance levels). An enterprise-wide approach to identifying the key corporate risks has been conducted. The resulting risks are recorded in a risk register and allocated to responsible officers for management. A rolling threeyear Internal Audit Plan is reviewed annually and based on the results of the enterprise wide risk assessment. The Board Audit & Risk Committee reviews the status of the Plan at each meeting along with audit reports from TIOs internal audit provider, Deloitte, and other third-party auditing organisations. The representation process detailed in the response to Principle 4 contains specific assertions regarding the adequacy and effectiveness of the risk management, internal control and compliance systems and processes. The Board, in March 2007, further recognised the importance of managing risks through the creation of a Reinsurance Committee. This Committee ensures that appropriate transfer of risk, through the use of reinsurance, in order to protect TIO from significant events that might impact on its insurance or Motor Accidents Compensation Scheme Business. PRINCIPLE 8: ENCOURAGE ENHANCED PERFORMANCE FAIRLY REVIEW AND ACTIVELY ENCOURAGE ENHANCED BOARD AND MANAGEMENT EFFECTIVENESS. The business performance of TIO is continually monitored and regularly reported at both a management and Board level. Through the Board Remuneration, Nomination & Succession Committee, the Board Chairman annually reviews the performance of individual Board Members. In turn the Committee also reviews the performance of the Board Chairman and the Chief Executive annually. The structure of the Chief Executives evaluation is consistent with TIOs Performance Review process under which every employees performance is formally assessed on a biannual basis. A strong commitment to the professional development of staff in terms of technical and personal effectiveness exists and this is linked to the Performance Review process. PRINCIPLE 9: REMUNERATE FAIRLY AND RESPONSIBLY ENSURE THAT THE LEVEL OF COMPENSATION IS SUFFICIENT AND REASONABLE AND THAT ITS RELATIONSHIP TO CORPORATE AND INDIVIDUAL PERFORMANCE IS DEFINED. The remuneration of Board Members is determined by the Minister and the Chief Executives remuneration is determined by the Board after consultation with and agreement by the Minister. The Board Remuneration, Nomination & Succession Committee make relevant recommendations to the Board on this and several other matters. All general and senior managers are employed on performance-based contracts. Performance criteria incorporating both corporate and position accountability elements are encapsulated in agreed annual performance plans. TIO has extended performance-based assessment and remuneration to all employees. PRINCIPLE 10: RECOGNISE THE LEGITIMATE INTERESTS OF STAKEHOLDERS RECOGNISE LEGAL AND OTHER OBLIGATIONS TO ALL LEGITIMATE STAKEHOLDERS. TIO has developed a compliance culture and systems aimed at identifying, actioning and reporting on the legislative, contractual and other obligations that TIO has to its stakeholders. The liaison and reporting processes between TIO, the Minister and the Northern Territory Treasury have been outlined in the preceding Principles. Recognising the important role it plays in the Northern Territory and the lives of Territorians, TIO has adopted a Triple Bottom Line (economic, social and community) approach in the establishment of its key result areas. TIO acknowledges its obligations to the Northern Territory community and contributes in terms of supporting community and sporting events and in the areas of road safety and accident prevention. 07 2 0 0 7 A N N U A L R E P O R T
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