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Louder and stronger
We continued to invest in growing our impact for consumers
(Graphic: Sandra Davey, Choice Chair.)
(Graphic: Alan Kirkland, Choice CEO.)
We are pleased to
present this report on
CHOICE's performance
during 2018–19.
One of the Board's most important
roles is to approve CHOICE's strategy,
which identifies the organisation's major
priorities. 2018–19 was the first year
of a new strategy, which identifies three
key priorities – to increase the power
of consumers, to engage more people
and to grow our revenue. The following
pages provide more detail on our work
on these priorities during 2018–19.
This was a particularly important year
to build the power of consumers through
campaigning for changes to the law.
The Banking Royal Commission
dominated the first part of the financial
year, wrapping up its hearings in
November 2018 and reporting to government in February 2019.
CHOICE played an important role
in influencing the recommendations
of the Royal Commission through
a number of submissions. We were
pleased to see this effort rewarded in
the Commission's recommendations,
which reflected some of our long-term
priorities for reform to the financial
system, in particular:
- protection from unfair terms
in insurance contracts
- a requirement for mortgage brokers to
act in the best interests of their clients
- an end to 'grandfathered' commissions on financial advice
- a compensation scheme of last resort
for consumers who lose money due
to poor advice or misconduct.
Our other major campaigning priority
was improvements to product safety
laws, through the introduction of a law
to require that goods are safe before
they are released onto the market
in Australia. While not yet achieved,
the Government has committed
to consulting on this reform.
We also continued to advance
campaigns in other important areas
such as food labelling, health insurance
and renters' rights, and worked with
Superannuation Consumers Australia
to set up a specialist centre based
at CHOICE.
Within the organisation, improving
our editorial work was an important
theme, with a focus on renewing our
reputation for investigative journalism
and growing our online audiences.
We applied our investment in digital
capabilities to improve choice.com.au
with a focus on improving the way that
it works on mobile devices. Behind the
scenes, we continued an important
program of technology modernisation,
which has the benefit of making the
website faster, improving information
security and making it easier for
us to launch future improvements.
Recognising the strategic importance of
technology to our future, we introduced
a new role of Chief Data and Technology
Officer, reporting to the CEO.
We launched one of our boldest
experiments with new ways of helping
consumers in complex markets, through
our Transformer energy switching
service. While we ultimately had to
close this service before it reached
profitability, after the New South Wales
Government launched a free alternative,
it demonstrated some important benefits
for consumers. It helped over 2500
people to save almost $1.7m on energy
bills and provided data on how much
some consumers were being ripped
off, which supported our successful
campaign for fairer default electricity
prices. It also demonstrated the
feasibility of a service based on scanning
consumers’ bills to help identify savings,
which was adopted in the New South
Wales Government’s service.
Transformer was the latest of over
15 new ideas to be tested by our New
Things team, which has had an enormous
impact on our approach to innovation.
In 2019–20, we will be winding down
this team, as the changes in culture
influenced by New Things have allowed
us to embed a commitment to innovation
across the organisation.
Finances
As a not for profit, we need to ensure
that the organisation has an adequate
level of cash reserves to weather any
unexpected factors, while also ensuring
that our resources are put to best use for
the benefit of consumers. This tends to
mean that we go through cycles, building
reserves over several years, then using
them to invest in the organisation. In
accounting terms, this is reflected in
periods of surplus and periods of deficit.
After five years of above-budget
surpluses, in 2016 the Board recognised
the need to make some strategic
investments in building the people,
technology and capabilities that
CHOICE requires to help consumers
in increasingly complex markets. This
has taken the form of planned deficit
budgets over the past three years,
which have helped us to build our profile
as a campaigning organisation and
modernise the technology that is critical
to the way that we engage with the over
one million consumers who visit
us online every month.
In 2018–19, while our expenses grew by
2%, revenue grew by 3.5%, as we started
to reap some of the rewards of our
investment. Importantly, while growing
membership revenue we continued
to diversify, with non-membership
revenue growing by 16%. Our deficit of
$1.78m (of which $1.53m was from
operating activities and $0.25m
was for expenditure against a
grant received in a prior year)
was consistent with the financial
strategy overseen by the Board.
We ended the year with a cash
and investments balance of
$9.63m, which provides a healthy
margin over the cash reserves floor
of $5.12m set by the Board
for 2019–20. We have budgeted
for a significantly lower
deficit in 2019-20.
Governance
We were sad to bid farewell to Ben
Slade, who stepped down from the
Board in November 2018. In his five
years on the Board, Ben applied his
deep knowledge of consumer law to
guide our approach to campaigning,
chairing our Campaigns and Advocacy
Committee for most of that time.
He was replaced by another Ben
– Ben Heuston – who was elected
unopposed to the Board. Ben brings
important commercial and digital
experience from roles with a range of
organisations including Telstra and the
Copyright Agency Ltd.
Recognising the importance of strong
editorial strategy to CHOICE's success,
we conducted a search process for a
person with these skills and were pleased
to co-opt Ben Naparstek as an additional
member of the Board. Ben brings strong
editorial experience from his time with
Fairfax, SBS and The Monthly.
We continued to invite CHOICE
members to apply for voting membership,
helping to maintain a healthy number
of voting members, at 5806 as at 30
June 2019. Voting members received an
email update after each Board meeting
and many took up the invitation in these
updates to ask questions or make
suggestions via the Chair.
Looking ahead
As we prepare to celebrate our 60th
anniversary, we feel privileged to work
together in leading the Board and
staff of this critical pillar of Australian
civil society. Knowing that members
are the lifeblood of our organisation,
our greatest priority for the coming
year is to refresh the way we think and
communicate about what it means to
be a member of CHOICE, so that we
can do more to demonstrate the value
of membership to the people who
already know us, as well as introducing
CHOICE to new generations of
Australian consumers.
We thank all of the members, staff
and volunteers that have contributed
to our achievements in the past year,
and look forward to working with you
in 2019–20.
The difference we've made
We secured major change to benefit all consumers through
research, policy work, engaging with politicians and
harnessing the power of our supporters
(GOAL: Increase the power of consumers)
(Graphic: Alan Kirkland, Erin Turner and Sarah Agar present CHOICE's research into the consumer
experience of renting at Australian Parliament House.)
This year we worked to make
Australian laws and business
practices fairer, better and
safer – work that is only
possible thanks to the financial support
of our members and the action taken
by CHOICE campaign supporters.
New laws for consumers
Our policy and campaigns team worked
tirelessly to get great laws passed and
poor laws improved. We’re often the
only voice in the room representing
consumer interests, pushing back
against well-resourced corporations.
(Graphic: 515,585
Victorian rental
households have
stronger protections.)
Held accountable
We regularly complain to regulators
about shoddy business behaviour.
This year our complaints led to major
action against the following companies
caught doing the wrong thing:
- Timeshare company Ultiqa was
fined $135,000 and had to refund
$3 million to customers for failing
to comply with credit laws.
- A court found that serial offender
Viagogo had been misleading
consumers on its ticket resale site.
- Retail giant Kogan changed its
terms and conditions after our
investigators caught it failing to be
upfront about the consumer law.
- Jetstar paid $1.95 million after a
CHOICE complaint. All domestic
airlines agreed to clean up their
act on claims about consumers' rights when flights are delayed
or cancelled.
- White King paid up $700,000 for
misleading customers about not-so-flushable wipes.
(Graphic: CHOICE banking experts Madison Cartwright and
Patrick Veyret representing consumer interests
outside the hearings of the Banking Royal Commission.)
(Graphic: We're fighting to fix $5 million
superannuation
accounts in
underperforming
funds.)
In 2018–19, we saw the passage of a
number of laws that we were
arguing for, including:
- new Federal Laws
that mean gift card
expiry has to
last for at least
three years
- strong changes in NSW to make
it easier to access tribunals and
reform lengthy contracts and unfair
non-disclosure agreement practices
- changes to superannuation laws
to deal with poor performing funds
and improve default insurance, leaving
more money for people in retirement
- increased penalties
for big banks and
big companies
that break
consumer laws
- new rules in the
energy market that will save
consumers up to $450 a year
thanks to fairer default prices and a
ban on misleading discount practices.
Collaborating with
other not-for-profits
Our work with other trusted groups
further amplified our impact. We
continued to partner with the Consumer
Action Law Centre, Financial Rights Legal
Centre, Financial Counselling Australia
and other respected advocates to get
better protections in the finance sector.
In December 2018 we released
the second edition of our research into the rental
market in
partnership
with National Shelter and the National
Association of Tenants Organisations.
Drawing upon this research, we
supported a campaign
led by the Make
Renting Fair
coalition in
Victoria, who
secured major
reform, and
we’re hoping
for action in
South Australia
and Queensland.
(Graphic: 750,000
households on lower
electricity prices)
(Graphic: Super Consumers Australia)
For years CHOICE has been calling
for funding for a stand-alone consumer
group in the superannuation sector
to help navigate the complex debates
that directly impact the quality of our
retirement. In 2018 we helped to secure
$2.5 million for superannuation advocacy.
CHOICE is now working alongside Super
Consumers Australia to deliver this. The
organisation is being incubated within
our building where we can provide direct
support to the five specialist policy,
economics and communications experts
that are going to deliver big changes for
many years to come.
The near future
Systemic change typically takes several
years to deliver. As of June 2019, we
were expecting changes to your data
rights – which would give you access to
the data that businesses hold about you
– and changes to make insurance
in superannuation fairer.
In the next year, we'll be pushing
hard to get added sugar labels,
improve health star ratings, make
pet food safe, get bank advertising
out of schools, improve product
safety laws and deliver more
improvements to the laws that apply
to banks, brokers and insurers.
(Graphic: CHOICE supporters send in their hand-written letters to Ministers calling for better food labelling.
In August 2019 all state and territory Ministers agreed to label added sugar on the back of packs, a
major win secured thanks to our supporters.)
Investigations that matter
We used our unique position to shine a light on consumer
issues – and to demonstrate the need for stronger
protections in both products and services
(GOAL: Increase the power of consumers)
One of our key priorities in
2018–19 was to rebuild
CHOICE’s reputation for
investigative journalism.
In March 2019 Andy Kollmorgen
reported on the continued dangers
posed by button batteries and the failure
of manufacturers to follow the voluntary
button battery safety standard. This
investigation, which checked 17 common
household items against the standard,
found that 10 of the items failed to keep
batteries from being easily accessed,
creating a significant danger to toddlers
and young children.
Our work in this area didn't end there.
We also obtained interviews with the
two Australian mothers who have
tragically lost children to button battery
ingestion. Their heart-breaking stories,
published in April and May, helped
reinforce the clear need for better
safety regulation and underlined the
importance of our investigative work.
(Graphic: Isabella Rees, died January 2015 aged 14 months.)
(Graphic: Summer Steer, died June 2013 aged 4 years.)
Button battery safety failures
Battery was not secured and was easily accessed by our testers
(Graphic: Surgipack digital infrared ear thermometer model #6182)
(Graphic: Petsport Bling Bling Blinkers pet lead )
(Graphic: Ready Set Travel digital luggage scale)
(Graphic: Heller remote for pedestal fan model #RPF50CR)
(Graphic: The really tiny book light 5101)
(Graphic: Roche blood glucose meter ACCU-CHEK Guide 929)
(Graphic: Avanti digital fridge/freezer thermometer model #12931)
(Graphic: Beurer Living kitchen scale model #KS28)
(Graphic: Baccarat global electronic kitchen scale model #1026649)
(Graphic: Sanitas glass scale model #SGS 06)
Read more about the dangers of button batteries at choice.com.au/buttonbatteries
(Graphic: Children decorate their mother's coffin for a funeral arranged by death doula Lola Rus-Hartland.)
In May we also released the first
of our investigations into the funeral
industry, written by Saimi Jeong, a
Walkley Award winning journalist who
joined our team in January. This series
will continue into 2019–20, but we've
already found evidence of widespread
problems with the industry in Australia,
and ample motivation to continue
to investigate this sector.
During the year we made some
important changes to our editorial
teams, to diversify the types of content
that we produce to help consumers.
We have begun commissioning more articles from external writers, including
opinion columns by experts. These have
included contributions
from dental health expert
Matt Hopcraft on the
subject of added sugar,
Dr Ruth Barker, director
of the Queensland Injury
Surveillance Unit, on
product safety, and Karen
Cox from the Financial
Rights Legal Centre on
the dangers of buy now,
pay later services.
We also established
a new team focussed on
creating content that we can use
to supplement and amplify the great
work of our investigative journalists,
campaigners and reviewers. Their
stories and videos are crafted
specifically to be shareable on social
media, helping us to inform more
consumers and raise awareness of
CHOICE's work. They produced some
great content in the second half of
the year, including a series helping
consumers work out which mattresses,
TVs, ovens and coffee machines not
to buy in the EOFY sales season – all
product areas that matter to many
consumers. Through their efforts
our work has reached hundreds
of thousands
more Australians.
We also refreshed
our flagship publication,
CHOICE, introducing a
unifying theme for each
edition. The response
from members has been
overwhelmingly positive
and we're looking
forward to continuing
this experiment.
Finally, an interesting
email from a researcher
at the Oxford English Dictionary alerted
us to the fact that CHOICE magazine’s
contribution to modern language is
to be celebrated. We were able to
supply scans of our June 1999 issue
which helped prove we had the earliest
recorded use of the term 'e-waste',
in an article by former CHOICE
journalist Karina Bray. This unexpected
achievement demonstrates CHOICE's
innovation and impact – something
we strive to maintain.
Campaigning for change
Over 200,000 campaign supporters helped us fight for reform
(GOAL: Engage more people)
We make change
happen by working
with hundreds of
thousands of people
across Australia to influence decisions:
people who through 2018–19 signed
petitions, emailed politicians and
encouraged their friends to
take action.
In line with our new strategy,
we intensified our work on a smaller
number of issues. This means we are
more likely to win campaigns for
bigger reforms in areas like health
insurance, the superannuation
system and the banks.
Quality and quantity: Engaging
more people in meaningful action
We tested new ideas in our campaign
initiatives, aimed at making a deeper
impact. Here's how our supporters
worked with us:
Writing letters:
700+ supporters agreed to
send a handwritten letter to
their health minister about
added sugar labelling.
Supporting investigations:
1700+ supporters sent us copies of
letters from their health funds so we
could investigate whether providers
had been transparent about changes.
Collecting evidence:
We received 300+
supporter-submitted
photos as part of our
safe pet food, added
sugar and unit pricing
actions, giving us case studies
to explain why change
is needed.
Attending strategic events:
20+ people (and pets!) turned out
to our safe pet food media event with
a live cross to the Today show.
Making phone calls:
We asked
dedicated supporters to call
politicians in our banking and
food campaigns, making
a real difference at
crucial points of the
law reform process.
We're going to continue this work
next year. Our petitions and email
actions contribute to major change but
our aim is to work with more Australians
in more creative ways to ensure that
consumers' voices are heard.
Many of our voting
members have
already signed up to
support our campaigns.
You can do so at
choice.com.au/campaigns
(Graphic: Christina, Adelaide: "Our doctor told us that there
would be a gap fee of $3500 and
our health fund told us part of the
procedure was covered. But on the day before the
surgery the hospital called us and said eye surgery was
excluded under my cover and we'd have to pay an
additional $4000 on admission." Campaign supporter Christina worked with us to highlight the high out-of-pocket costs that you
can face even when you have high-level health insurance. )
(Graphic: Campaign supporters and pets join us in Mackey Park for a live cross to the Today show to highlight
the need for stronger laws to make pet food safe.)
Membership matters
We focussed on the sustainability of membership
through improving our online tools and introducing
our first price rise in over four years
(GOAL: Grow our revenue)
(Graphic: 21,874,600 visits to choice.com.au in 2018–19 )
Recognising that the majority
of members choose to
engage with us online,
improving choice.com.au
was a priority. A large in-house team
worked to rebuild the website to
improve critical features used by
members and ensure that it is fast
and easy to use on mobile devices.
Importantly, this work also improved
how choice.com.au is rated by search
engines, which will ensure that
consumers who don't know about
CHOICE continue to find us when
searching online.
Some of the key upgrades launched
through 2018–19 included:
- an improved home page that does a
better job of showcasing everything
that we do
- a new navigation menu, to make it
easier for people to find the information
they need
- a new product finder tool for our
test results that is easier to use
on mobile devices
- improvements to the infrastructure
behind choice.com.au, so that the
website loads faster and is
more secure.
The team also worked hard to
get some timely and helpful health
insurance advice up on the website
after the government introduced the
new gold, silver and bronze scheme at
the end of the year, and nearly 50,000
people accessed our advice in the
first few weeks of it being published.
We also continued to improve
our fortnightly emails to members,
which resulted in a 15% increase in
the number of people who clicked
through from a member email
to the website. And recognising
the importance of CHOICE
magazine to many members,
we began a program of
iterative improvements,
as reported on pages 5–6.
An increase in prices
for quarterly memberships
– our first in over five years –
commenced for new members
in October 2018 and current
members from January 2019. As this
had an impact on the numbers of
new members joining CHOICE and
of existing members renewing, our
number of subscriptions dropped from
182,077 as at 30 June 2018 to 174,906
as at 30 June 2019.
Keen to reward the loyalty of longer
term members, we left the price of one and two-year memberships unchanged.
An increasing proportion of members
chose to take out these options which
provides greater financial stability
for CHOICE. As at June, 27% of
choice.com.au members had a one or two-year membership, up from
18.5% a year earlier
Overall, these changes led to a 1%
increase in membership revenue.
Late in the year, we commenced a new
project to reimagine membership and
ensure that it reflects the increasingly
diverse ways in which consumers wish
to engage with us. We
see this as critical
to our future
sustainability
and look
forward to
reporting
to voting
members
on our
progress
during the year.
(Graphic: 50,000 people read our advice on health insurance in the first few weeks)
Reviews and testing
Our testing of consumer goods and analysis of service
providers expanded and continued to add value
(GOAL: Grow our revenue)
(Graphic: Staff test a range of products in the CHOICE labs, including children's cots and toasters.)
(Graphic: 328,000 people a month used our tools to choose products and services)
The results of our testing
of household products and
analysis of services like
insurance are highly valued by
CHOICE members. During 2018–19, we
brought together all of our staff involved
in this work across into a new team,
known as CHOICE Reviews and Testing.
This shift recognised that the boundaries
between products and services are
breaking down, and that decisions about
services are increasingly important and
complex for consumers.
In April 2019, we retired our popular
health insurance finder tool after
regulatory changes introduced gold,
silver and bronze policy tiers. Once
the impact of these changes became
clearer, we began work on a new version
of the tool that will incorporate these
changes and other improvements.
Other service areas we examined
during the year included grocery
delivery, car rental, ridesharing, food
delivery and appliance retailers.
We also expanded our testing further
into the fast-moving consumer goods
market. In the food category, we
covered numerous popular products
such as bread, black tea, peanut butter,
yoghurt and butter. We also shone
a light on
some nonfood items that
have not been
particularly well
covered in the past,
such as menstrual pads
and incontinence pads, as well
as testing a broad range of cleaning
products. The results of many of these
tests were made available to the public,
to introduce potential members to the
value of CHOICE testing.
Recognising the growth of Internet
of Things products, we tested voice-activated home assistants and 'smart' appliances, with a focus on consumer
concerns around privacy issues.
Our testers also supported CHOICE's
work for stronger product safety laws,
as there is currently no general
requirement for goods sold in Australia
to be safe. Our deep background in
testing children’s and babies' products
and our ability to design tests to
demonstrate the risks from products
containing button batteries provided
a wealth of data to support CHOICE's
campaign. This is an excellent
example of CHOICE's testing for
members providing benefits
to the broader population
of Australian consumers.
Our test research
arm – which provides
expert testing services to
government, manufacturers
and our sister organisation
Consumer New Zealand
– delivered over $1m to the
bottom line. We also tested new
partnerships with e-commerce sites and
online retailers. These arrangements
help consumers to complete a purchase
after reading a CHOICE review, as well
as providing new sources of potential
revenue to improve our sustainability.
CHOICE Recommended
Highlighting the best products and services
(GOAL: Grow our revenue)
While decisions
about which
products
we test and
review are always driven
by consumer needs, where
a product or service has
performed to a high level
in our research and testing,
our endorsement program
recognises this. Qualifying
brands can apply to use our
logo on their products and
advertisements under
strict approval and
licensing conditions.
In 2018–19, after a
few years fast growth for
the CHOICE Recommended
program, we focused on
expanding into new areas
and streamlining our
internal processes:
- We increased
competition by
highlighting emerging
brands that were shown
through our testing
to have introduced
high quality products
and services.
- We expanded into new
categories, including
food, to help consumers
choosing everyday
grocery items at
the supermarket.
- We automated our
internal processes so that
we are able to work
more efficiently.
Importantly, we always put our values
first, turning down
licensing opportunities
with businesses that
have treated their
customers poorly.
Overall, CHOICE
Recommended
delivered 12% year-on-year growth, playing
an important role
in strengthening our
position, our brand and
sustainability into the future.
(Graphic: Choice Recommended logo, Choice Recommended Provider logo, Choice Best Brand logo, Choice Consumers' Choice logo)
Expanding our social impact
CHOICE staff led environmental and fundraising initiatives, to improve our impact as an organisation
Our staff-led Environmental
Impact Committee
continued their initiatives
to reduce our waste and
contribute to the local environment.
Our office recycling program expanded
to include soft plastics and beverage
containers, coffee capsules, batteries
and light globes. And our composting
volunteers collect our organic food
waste daily to feed our worm farms and
compost bins, with gardening working
bees providing healthy activities during
lunch breaks.
In March 2019, with support from
Inner West Council and local
community group, The Mudcrabs,
staff volunteers planted 50 new native
seedlings along the Cooks River. Two
wattles have grown into tall trees and
are now flowering, along with native
violets and bluebells.
(Graphic: BushCare: Native Geranium planted March 2019 and flowering in September 2019.)
We participated in Plastic Free
July, providing tote bags to staff
to reduce single-use plastic and
promoting reusable items and reduced
waste practices.
We continued to benefit from solar
panels installed on the CHOICE building
in late 2017, with a 15% year-on-year
reduction in electricity consumption.
Social impact
Our staff-led Social Impact
Committee continued to oversee
our partnership with the Women’s
and Girls' Emergency Centre (WAGEC),
which is the beneficiary of regular staff
fundraising and donations of goods
that have been tested by CHOICE.
We donated over $40,000 worth
of goods to help WAGEC clients
in 2018–19, and in May 2019 a team
of CHOICE staff banded together to raise a further $8637 at the Walk
for WAGEC fundraiser.
The Committee surveyed staff
to seek ideas for improving CHOICE's
social impact initiatives. This led us
to train new leaders for our BushCare
site, expand volunteer leave to cover
ethics teaching in schools and blood
donation, and explore new partners
for our payroll-based workplace
giving program.
Within the office, we reviewed our
procurement practices for stationery
and office supplies and provided
information on how to make ethical
product selections.
Diversity and inclusion
CHOICE understands that to meet
the needs of Australian consumers,
we need a workforce that reflects the
diversity of the Australian population.
Through 2018–19 we expanded our
work to attract and retain a diverse
and inclusive workforce.
Early in 2019 we engaged Aboriginal-owned company Mirri Mirri
Productions to provide Indigenous
cultural awareness training. This is
an ongoing program, with the intention
that all staff will participate. A number
of staff were inspired to explore further
opportunities for including Indigenous
communities in our work.
We report annually to the Workplace
Gender Equality Agency on our strategies
to promote and improve gender equality.
This helps us to track our performance and benchmark against other
organisations. As at the reporting date:
- 54.5% of the CHOICE Board
was female
- 56.1% of our workforce was
female and 43.9% male
- 62.5% of our key management
personnel were female
- Of the staff members ranked as
“professional”, 55% were female
- 60% of all manager promotions
had gone to women.
We upgraded our offices to improve
accessibility for people with physical
disabilities and developed a relationship
with JobSupport to explore employment
opportunities for people with disability.
To promote cultural inclusion, a staff-led group organised celebrations for
significant events including Lunar New
Year and Pride Month.
Investing in our future
We invested in technology and innovation and tested new ways of assisting consumers
We entered 2018–19
in a strong financial
position, with $10.24m
in cash and term
deposits as well as a substantial
property asset in the form of CHOICE's
headquarters in Marrickville.
Most of our cash had been built
up over five successive years of above
budget surpluses in the period to
2015–16. The total value of these
surpluses was $6.31m, excluding the
impact of a grant to help consumers
in the travel market (noted below).
Given the rapid changes in the way
that consumers engage with CHOICE,
in 2016 the Board recognised the
need to make some strong strategic
investments to support our future
sustainability. These investments,
which have taken the form of planned
deficits totalling $3.26m over the past
three years (excluding expenditures
related to the travel grant), have allowed
us to build the organisation's profile
as a campaigning organisation, invest
in technology that will support future
growth, and develop our own in-house
capability to build and improve digital
tools to help consumers. It has also
helped us to grow our annual revenue,
which has increased by $2.36m, or
12.9%, over the past three years.
In 2018–19, our revenue grew
by 3.5%, from $20.01m to $20.72m,
driven by modest growth
in membership revenue and
strong growth in non-membership
revenue from the CHOICE
Recommended licensing scheme,
Transformer, and product testing
services. Total non-membership
revenue accounted for 21.1% of
total revenue, up from 18.9% in
2017–18. This is in line with our
strategy to diversify our revenue
sources so that we are less
exposed to fluctuations in
membership revenue.
Our operating expenses
(excluding cost of sales) increased
by 2%. Reflecting the areas of
strategic investment approved
by the Board, the key areas of
increases in expenditure were
in technology and innovation.
Our investment in technology
supported improvements to
choice.com.au – the way that most
consumers engage with us – as well
as enhancements to our technology
and data platforms, so that they are
more flexible and able to support future
innovation. Some of these changes
also delivered significant savings
in recurrent operating costs.
Our investment in innovation
allowed us to continue to test new
ways of assisting consumers in
complex markets, including the
Transformer energy switching service.
This was a bold and innovative
service that demonstrated great
results for its customers but we
decided to close it after the New
South Wales Government launched
a free alternative. This resulted in
a net operating loss for Transformer
of $0.72m, which is incorporated
in the overall deficit.
Our full-year deficit (inclusive
of $0.25m travel grant expenditure)
decreased from $1.99m in 2017–18
to $1.78m in 2018–19. This was
consistent with the financial strategy
approved and monitored by the
Board. We have budgeted for
a significantly lower deficit in 2019–20
as we continue to target investment
in areas that have demonstrated
the greatest potential for growing
our revenue and impact.
Despite our deficit, over $1m
growth in deferred revenue meant
that our cash and investments
balance reduced by $609k, leaving
us with $9.63m in cash and term
deposits as at 30 June. This is a strong
financial position, with a significant
buffer over the cash reserves floor
of $5.12m set by the Board
for 2019–20.
| |
Year ended 30 June 2019
|
Year ended 30 June 2018
|
|
Revenue
|
$20,270,643
|
$19,582,832
|
|
Other income
|
$447,234
|
$427,747
|
|
Less: Direct costs
|
($1,715,512)
|
($1,614,318)
|
|
Less: Operating costs
|
($20,785,948) |
($20,386,835) |
|
Net surplus/(deficit)
|
($1,783,583) |
($1,990,574) |
|
Current assets
|
$11,043,957
|
$11,255,901
|
|
Non-current assets
|
$10,192,344
|
$11,066,484
|
|
Current liabilities
|
($8,190,753)
|
($7,562,741)
|
|
Non-current liabilities
|
($360,895) |
($291,408)
|
| Net equity |
$12,684,653
|
$14,468,236 |
Meet our Board
CHOICE's Board brings a broad range of skills to guide our strategy
Sandra Davey (Chair)
Sandra is an experienced digital and
internet executive and managing director
of Product Space. Her love is coaching
and helping organisations streamline their
digital product practices to improve agility,
innovation and product success.
Increasingly she works with organisations to unpack the cultural
and structural issues that impact their ability to create value.
Sandra’s industry experience crosses telco/broadband, digital
media, interactive TV, sport, libraries, industry associations and
consumer advocacy. She served as a director and chair of the
Australian Interactive Media Industry Association (AIMIA) during
the 2000s and was one of the co-founders and inaugural directors
of the Australian Domain Name Authority (auDA). For her
contribution to the digital media industry, she was inducted into
AIMIA’s Hall of Fame in 2015. She joined the Board of CHOICE in
2012 and was elected Chair in 2017. She chairs the Governance and
Culture Committee and Investment Committee, and is a member
of the Commercial Sustainability Committee and Technology and
Data Committee. Sandra also serves on the Marketing Advisory
Committee to the Board of Bush Heritage Australia.
William Davidson (Deputy Chair)
Bill is CEO of the Worklink Group in Tropical
North Queensland, providing support
services, including employment services, to
people experiencing mental health
challenges. Bill is committed to making a
difference to people’s lives by creating an
environment that fosters positive impact. He was Managing
Director of Australian Hearing from 2013 to 2018. For the four years
prior to that he was Managing Director of Job Futures Limited, now
known as CoAct. He has extensive experience in the delivery of
contracted, outsourced services here in Australia, and overseas in
the UK and South East Asia. Bill was also the interim CEO of
CHOICE in 2008 whilst we sought a new CEO. Bill is passionate
about finding ways to provide fair competition and deliver a better
deal for the Australian consumer. He served on the CHOICE Board
from November 2006 to August 2008. Following the appointment
of Nick Stace as CEO in February 2009, he was co-opted onto the
Board in November 2009, and then elected to the Board in
November 2010. He is Deputy Chair of the Board and member of
the Finance, Risk and Audit Committee, Commercial Sustainability
Committee, and Impact and Engagement Committee.
Fiona Guthrie AM
Fiona has over 30 years' experience in
consumer advocacy, including a number of
years on the executive of the Consumers
Federation of Australia. Her main interest is
advocating for people on low incomes or in
vulnerable circumstances, particularly in the
financial services marketplace. For ten years, she has been CEO of
Financial Counselling Australia, the peak body for financial
counsellors. She has held directorships on Energex Retail Pty Ltd,
the Insurance Ombudsman Service and the Financial Ombudsman
Service, and was chair of ASIC’s Consumer Advisory Panel. Fiona is
currently a member of the ACCC’s Consumer Consultative
Committee, the Australian Government Financial Literacy Board
and a board member of Way Forward Debt Solutions and the
Queensland Competition Authority. She holds a BA, LLB and MBA
and was made a member of the Order of Australia in 2017 for her
work in social welfare and financial counselling. She joined the
Board in November 2015 and is a member of the Finance, Risk and
Audit Committee and Investment Committee.
Alexandra Kelly
Alexandra is Director of Casework at
the Financial Rights Legal Centre, which
operates the National Debt Helpline
in NSW, Mob Strong Debt Help and the
Insurance Law Service. She is a member
of the Law Council’s Australian Consumer
Law Committee and is the consumer representative on the Life
Insurance Code Compliance Committee. She served on the
Board of the Financial Counsellors of NSW from 2009 to 2012.
Alexandra has considerable experience developing consumer
rights in the financial services sector through lobbying, working
with regulators and government, and raising public awareness
of issues in the media and through online financial literacy
campaigns. She brings to the CHOICE Board high-level legal
expertise, extensive sectoral knowledge, and understanding of
social enterprises. Alexandra holds a Bachelor of Laws (Hons)/
Bachelor of Psychology and Master of Laws. She was appointed
to the Board in 2017 and is a member of the Governance and
Culture Committee and Impact and Engagement Committee.
Ben Heuston
Ben has almost two decades' experience
growing new businesses, brands and
service lines with various organisations.
He has headed up digital, innovation and
product teams in media at Telstra, with
Australia’s largest magazine company,
and at the Copyright Agency. Ben is a
former innovation consultant, currently developing improved
customer experiences for consumers at Westpac Bank. He has an
MBA from Cranfield University in the UK, is a Chartered Marketer,
has a postgraduate diploma in Government and BA/LLB degrees
from the University of Sydney. Ben was appointed to the CHOICE
Board in November 2018. He is a member of the Commercial
Sustainability Committee and Technology and Data Committee.
Ben Naparstek
Ben has almost a decade's experience
managing cross-functional teams
across content, marketing and emerging
technologies. He headed up online services
at SBS and served as the digital director of
communications marketing firm Edelman,
leading the Australian office’s team of videographers, designers,
UX experts, social curators, paid media specialists, programmers
and producers. Ben has served as editor-in-chief of Fairfax Media’s
Good Weekend magazine and national current affairs magazine
The Monthly. Currently, Ben is Director of Audible Originals,
overseeing original documentaries, dramas and series for Audible,
the Australian arm of the world’s largest seller and producer of
spoken word entertainment. He was appointed to the CHOICE
Board in October 2018 and is a member of the Governance and
Culture Committee and Impact and Engagement Committee.
Robert Southerton
Robert is an experienced professional
in marketing, digital, analytics and
statistics. He has a broad range of
experience across IT, telecommunications,
finance and biotechnology industries,
having worked for companies including BT
Financial Group, ING Direct and Unwired. He has a strong interest
in data-driven decision making and holds qualifications in
statistics and operations research. He also gained a Foundations
of Directorship qualification from the AICD in 2015. Robert is
currently the Managing Director and co-founder of Gondwana
Genomics, an Australian biotechnology start-up exporting
genetic technology developed in Eucalyptus. He joined
the CHOICE Board in September 2014, and is a member
of the Finance, Risk and Audit Committee and the Governance
and Culture Committee.
Anita Tang
Anita has a strong background in public
policy reform, having spent 12 years with
the Cancer Council where she led the
transformation of its advocacy work. She
currently runs her own advocacy and
campaigning consultancy working with a
range of NGOs to bring about social change. She has held senior
roles in policy and advocacy at the Community Services
Commission and the Social Issues Committee of the NSW
Legislative Council, and has completed Harvard University's
Leadership, Organizing and Action: Leading Change program and
the Stanford Executive Program for Non-Profit Leaders. She has
served on the Boards of the Council for Intellectual Disability NSW,
the Intellectual Disability Rights Service, and the Centre for
Australian Progress, and is currently Chair of the Board of
Democracy in Colour, a racial justice campaigning organisation.
She is a long-standing CHOICE member, and with the Cancer
Council led a number of collaborative projects including campaigns
against junk food advertising to children and the regulation and
eventual ban of commercial solariums. She joined the Board in
March 2017 and is a member of the Commercial Sustainability
Committee and Impact and Engagement Committee.
Helen Wiseman
Helen Wiseman is a nonexecutive director, professional
mentor and philanthropist with over
30 years business experience across
a range of sectors including
technology, food, pharmaceutical,
insurance, energy and not for profits. A former KPMG
partner, she is a highly experienced audit committee chair,
having held this role for a number of boards. Helen is
currently a non-executive director and audit committee
chair for the South African holding company of the global
Bidfood foodservice business and also the privately owned
Soho Flordis International – a multinational natural
healthcare products business. In 2018, she completed
the 2018 INSEAD International Directors Program. Helen
also has a deep interest in supporting children of prisoners
through her role as a Patron of SHINE for Kids. She also
established the By My Side sub-fund of the Sydney
Community Foundation to further her philanthropic
support in this area. Helen joined the CHOICE Board
in November 2014 and is Chair of the Finance, Risk
and Audit Committee.
Jennifer Zanich
Jennifer is a senior corporate executive
and start-up CEO with a strong
entrepreneurial background. Jennifer
spent 10 years in San Francisco, where
she successfully started and funded
several companies including one of the
first programmatic ad networks, SeeSaw Networks, and Xumii,
a pioneer in mobile messaging (later acquired by Myriad Group).
She was also CEO of Wedgetail Communications, an enterprise
security company. She is experienced in corporate operations,
strategy and marketing, having spent eight years as Microsoft’s
Marketing Director in Australia and Asia Pacific. She has created
and delivered 12 products into international markets. Currently,
Jennifer is using her experience and skills to give back to the
next generation of entrepreneurs with her work at UNSW
where she is raising a fund to invest in university-led startups,
creating an Angel Investment Group and developing an
entrepreneurial ecosystem. Jennifer is a strong advocate for
the start-up community in Australia and is a member and
participant in many committees and think tanks. She is sought
after as a speaker on entrepreneurship and females in
innovation. Jennifer has more than 18 years’ experience as
a non-executive director and is a graduate of the Australian
Institute of Company Directors. She also serves on the board
of Jobhawk and as an advisor to Bullpen Capital, a US Venture
Capital company. Jennifer was appointed to the Board of
CHOICE in 2015 and is Chair of the Commercial Sustainability
Committee and a member of the Investment Committee.
