Full Version - Essential Energy

Corporate governance
52
Establishment
Country Energy is a statutory State Owned Corporation
(SOC) under the State Owned Corporations Act 1989,
established by the Energy Services Corporations
Act 1995. Under this Act, the principal objectives of
Country Energy are:
(a) to be a successful business and, to this end:
(i) operate at least as efficiently as any comparable
businesses,
(ii) maximise the net worth of the State’s investment
in it,
(iii) exhibit a sense of social responsibility by having
regard to the interests of the community in which
it operates,
(b) to protect the environment by conducting its
operations in compliance with the principles of
ecologically sustainable development contained in
section 6 (2) of the Protection of the Environment
Administration Act 1991,
(c) to exhibit a sense of responsibility towards regional
development and decentralisation in the way in
which it operates,
(d) to operate efficient, safe and reliable facilities for the
distribution of electricity and other forms of energy,
(e) to be an efficient and responsible supplier of
electricity and other forms of energy and of services
relating to the use and conservation of electricity
and other forms of energy,
(f) to be a successful participant in the wholesale
and retail markets for electricity and other forms
of energy and for services relating to the use and
conservation of electricity and other forms of energy.
A statutory SOC is declared to be an excluded matter
for the purposes of section 5F of the Corporations Act
2001 (Commonwealth) in relation to the whole of the
Corporation’s Law other than certain provisions relating
to financial products, or as may be otherwise declared,
in the Regulations under the State Owned Corporations
Act 1989.
Shareholders
In accordance with the provisions of the State Owned
Corporations Act 1989 and the Energy Services
Corporations Act 1995, Country Energy has two
shareholders each holding one share of $1. The
shareholders in 2004-2005 were the Treasurer of New
South Wales and the New South Wales Treasurer
Special Minister of State. Shares in an energy services
corporation may not be sold or otherwise disposed of,
except to eligible ministers.
Constitution
Country Energy’s constitution comprises a
Memorandum and Articles of Association which
address areas normally covered within a Corporations
Law company, including the administration of shares,
general meetings, directors, chief executive officer,
remuneration, meeting and administrative procedures,
company secretary, dividends and indemnities of
directors and officers.
Country Energy Board
The Energy Services Corporations Act 1995 provides
that the Board consists of –
• the chief executive officer, and
• one director, to be appointed by the voting
shareholders on the recommendation of a selection
commity nominated by the portfolio minister and the
Labor Council of New South Wales, and
• at least two and not more than five other directors
to be appointed by the voting shareholders at their
discretion.
One of the directors referred to in the last point is
appointed by the voting shareholders as chairperson
of the Board.
The voting shareholders have appointed five
independent non-executive directors for fixed period,
renewable terms, as shown in the following table.
The Board is accountable to the voting shareholders
in the manner set out in Part 4 of the State Owned
Corporations Act 1989 and in Country Energy’s
Constitution.
COUNTRY ENERGY ANNUAL REPORT 2004–2005