How CHOICE is run

Read accessible text version below, or download CHOICE Board Charter 2016 (PDF, 417kB)

BOARD CHARTER As reviewed by the Board at its meeting on 25 July 2016

Contents

1. Purpose, objectives and values
2. Board Composition
3. Role of the Board
4. Role of individual Directors
5. Role of the Chair
6. Role of the CEO
7. Role of the Company Secretary
8. The Board and strategy
9. Risk management
10. Policy framework
11. Stakeholder communication
12. Decision making
13. Board meetings
14. Board agenda and papers
15. Committees
16. Director protection
17. Board evaluation and development
18. Director selection
19. Director expenses
20. Director induction
21. Review of Directors' performance
22. Appendices

1. Purpose, objectives and values

CHOICE's purpose and objectives were updated as part of a review of the constitution in 2013. They are set out in rule 2 of the constitution:

Purpose and objectives of the company

2.1 Recognising the inequality in bargaining power between consumers and businesses, the overall purpose of the company is to work for fair, just and safe markets that meet the needs of Australian consumers. To achieve this purpose, the company seeks to:

2.1.1 ensure that consumers are able to understand and use or defend their rights;

2.1.2 empower consumers to engage actively in markets and make informed choices that reflect their best interests and values;

2.1.3 drive transformation of markets to create better products and services at fair and competitive prices;

2.1.4 give consumers a voice in the debates that matter to them;

2.1.5 achieve strong consumer protection through appropriate laws and industry behaviour; and

2.1.6 ensure that consumers receive a fair deal.

2.2 The company pursues its purpose and objectives by:

2.2.1 conducting research and testing in relation to products, services and markets;

2.2.2 promoting good practice in the production, marketing and delivery of products and services, including transparency around claims made about products and services;

2.2.3 promoting transparency around the price, quality, characteristics and safety of consumer products and services;

2.2.4 pursuing market and regulatory arrangements that enhance and protect the interests of consumers and ensure easy, effective redress for concerns about products, services or other conduct by suppliers;

2.2.5 raising awareness among industry, government and the broader community about issues that matter to consumers;

2.2.6 providing information, tools and services to meet the diverse needs of consumers; and

2.2.7 doing all other activities ancillary to, or necessary for, the fulfilment of the purpose and objectives of the company.

Our values are:

• We are fearless in finding TRUTH. We speak it, hear it, see it, share it & live it.
• We HELP each other, our members and all consumers.
• We make an IMPACT with a mix of rigour and humour.

2. Board Composition

The company has between 9 and 12 Directors, comprising:

• 9 elected Directors; and
• up to 3 co-opted Directors.

Three of the elected Director positions are elected each year. Co-opted Directors are appointed by the Board. The co-option process is used from time to time, to address skill gaps identified by the Board. The normal term of office of a Director is three years and Directors are generally only able to serve for three consecutive terms.

3. Role of the Board

The Board is responsible for overseeing the effective performance of the company, including:

• maintenance of the company's purpose and values;
• the ongoing development and sustainability of the company; and
• providing input into and reviewing its strategic direction.

The Board is ultimately legally accountable but recognises management's need to act with certainty and with the clear support of the Board and therefore:

• delegates the majority of responsibilities to its managers, setting out clearly its expectations for performance and the way in which performance will be monitored; and
• defines those responsibilities that it reserves for itself and equally is clear about how these responsibilities will be performed.

The business of the Board includes:

• consideration and approval of the strategy and business plan including the policy framework and broad priorities;
• ensuring competent management and financial stability of the company through appointment of a CEO and broad oversight of management performance;
• consideration and approval of the annual budget and any proposed (material) changes to the plans or budgets;
• determining the nature, form and regularity of reports from management to the Board on the performance of the company, covering all material aspects of CHOICE's operations, including key areas of risk, and as appropriate, measurements against targets and budget;
• considering and commenting on reports from management;
• setting delegation limits and authorities for management to commit resources;
• understanding any significant risks to employees, the company's standing, profits and assets, and approving management's plans to mitigate those risks;
• oversight of audit processes and making recommendations as required about appointment of auditors;
• approval of corporate governance policies;
• ensuring compliance with the company's legal accountabilities, including approval of the financial statements, Directors' report and annual report; and
• Board operations including succession planning.

4. Role of individual Directors

Individual Directors are expected to maintain 100% attendance at Board meetings. Any application for leave of absence must be made through the Chair.

Code of Ethics

The Board considers that there are certain basic ethical values that underpin the role of Directors of CHOICE. Directors will therefore:

• have an active concern for the purpose and values of the company and the members and customers it serves;
• diligently apply themselves to the business of the Board with the level of skill and care expected of a Director under the Corporations Act;
• act at all times with integrity and in the interests of the company as a whole;
• avoid any situation of conflict of interest so far as is possible, and manage any conflict which cannot be avoided;
• recognise and respect the distinct roles of the Board and management;
• work co-operatively with each other as members of the Board, engaging in debate;
• work co-operatively with management;
• not make improper use of information gained through their position as Director;
• keep confidential all Board discussions and deliberations and papers; and
• observe the spirit and letter of the laws under which the company operates.

Conflicts of interest

The standard of behaviour at CHOICE is that all staff and Directors scrupulously avoid conflicts of interest between the interests of the company on the one hand and personal, professional and business interests on the other. This includes avoiding potential and actual conflicts of interest as well as perceptions of conflicts of interest.

Directors are required to disclose any interests that involve potential conflicts with their role as a Director. Interests such as employment, directorships, other relevant appointments and material personal interests relating to the affairs of the company should be listed in the Board Register of Interests Update form (see Appendix 3). Any interests declared on this form are published on the CHOICE website.

In addition, Directors are required to declare any significant direct shareholdings, including personal superannuation schemes, using the Board Register of Shareholdings form (see Appendix 3). The Chair retains the records of any such declarations and should not disclose them to other Board members, staff or the public unless required by law or in the interests of the company. The Chair would generally only use the information in these declarations to raise a potential conflict of interest with a Board member where the Board member has not done so.

At the start of each meeting, each Director is required to complete a form identifying any potential conflicts of interest relevant to the agenda for that meeting and any updates to his or her general declaration of interests.

5. Role of the Chair

The Chair's overarching responsibility is to ensure that the Board properly fulfils its responsibilities. The Chair must ensure that the Board fully utilises the knowledge and skill available to it. Inside the boardroom, the Chair's principal task is to ensure the Board considers the right matters, considers them properly, comes to clear conclusions, and ensures decisions are implemented. This includes setting of meeting agendas, allocation of times, keeping discussion focused, and expressing the consensus of the Board. Additionally the Chair, as leader of the Board, should work to ensure positive dynamics both inside and outside the boardroom.

The Chair is the link between the Board and management between meetings and should be aware of any developments that may require him/her to take action on behalf of the Board or call a special meeting. The Chair should provide the CEO with guidance on matters of Board concern.

Whilst the CEO is the primary spokesperson for the company, there may be times when it is appropriate for the Chair to represent the company externally.

If the Chair is unable to fulfil any aspect of his or her role due to a conflict of interest or other specified reason, the Deputy Chair will replace the Chair. If the Deputy Chair is unable to do so due to a conflict or other specified reason, the Board will appoint another director to fulfil the relevant functions. 

6. Role of the CEO

The role of the CEO is to lead CHOICE and to ensure the delivery of its purpose, by:

• developing the company's strategic priorities;
• ensuring their delivery; and
• measuring their success.

The CEO's role also includes:

• managing the operations of the company;
• providing regular reports on key activities and progress against the annual business plan and targets;
• ensuring compliance with reporting requirements and statutory obligations;
• ensuring that there are opportunities for members to inform the company's priorities and work;
• managing relationships with key external stakeholders; and
• representing and promoting CHOICE externally, including internationally.

The Board evaluates the CEO's performance annually, against performance goals set by the Board, as detailed in the CEO Performance Review Policy, Appendix 6.

7. Role of the Company Secretary

The Company Secretary performs the duties and responsibilities of a company secretary as required by the Corporations Act, the company's constitution and any other relevant legislation. Working to the Board through the Chair, the Company Secretary's role includes:

• maintaining a register of Board policies;
• advising the Board on compliance with the company's statutory obligations and constitution (drawing upon specialist external advice as required);
• managing the Board election process, and the provision of notice to members of general meetings;
• providing secretariat services to the Governance Committee and Nominations Committee;
• monitoring and advising the Board on developments in research and good practice in relation to corporate governance;
• ensuring completion and lodgement of statutory forms with ASIC; and
• coordinating Board induction and development.

 

8. The Board and strategy

The Board approves the organisational strategy. The plan is developed through a process led by the CEO, which provides opportunities for Board input and discussion before a final plan is presented for approval.

The Board also approves an annual business plan, as well as annual budget and targets. In approving the Business Plan, the Board agrees on a schedule for reporting against the plan during the year.

9. Risk management

Although the Board has established a Finance, Risk and Audit Committee to oversee and advise on risk management issues, this does not absolve Directors of their responsibility to understand and interrogate the company's approach to assessing and managing risks. To assist Directors with this responsibility, the Committee oversees the development and maintenance of an Enterprise Wide Risk Management Framework (see Appendix 7), drawing upon specialist advice as required.

The Board receives reports on risk issues through the CEO's reports to the Board and the reports of the Committee. The Board also receives a dedicated report on workplace health and safety issues at each meeting.

In addition to this regular reporting, the CEO is expected to report any significant risks and strategies to mitigate them, to the Board as they arise.

10. Policy framework

The Board approves policies as required to ensure the effective governance of the company, consistent with the constitution.

A review date is identified for each policy as it is approved, to ensure a regular cycle of review.

11. Stakeholder communication

Responsibility for stakeholder communication resides with the Chair and CEO.

In general, the Chair is responsible for communication with members and the CEO is responsible for communication with organisational stakeholders such as other consumer organisations, government bodies, politicians, business partners and industry associations.

Other Directors assist in managing relationships with stakeholders, where agreed with the Chair.

12. Decision making

While the constitution provides that resolutions are passed by a majority of the votes cast by eligible Directors, in practice, the Chair establishes whether there is majority support for a resolution through the discussion of the resolution and confirms this at the end of the discussion.

The constitution allows for circulating resolutions. This provision would usually only be used for urgent and non-controversial decisions.

The Board aims for respectful yet vigorous discussion in which disagreement is an accepted part of the process but the aim is eventual consensus. Once the Board has made a decision, Directors are expected to support it as a decision of the Board.

13. Board meetings

The Board meets on dates and at locations set in the Board calendar at the commencement of each year. The normal meeting pattern involves five face-to-face meetings per year and up to two teleconferences where required to progress business. The Chair may also call additional meetings where required.

The overall management of the business of the meetings is the responsibility of the Chair in consultation with the CEO.

Outside of Board meetings, the CEO is the principal point of contact with management on behalf of the Board. The Chair is the principal way through which Board members interact with management. Chairs of committees will also have direct contact with managers responsible for servicing those committees.

Board members are expected to exercise care and appropriate confidentiality in their communication on Board matters with each other and with external parties.

14. Board agenda and papers

At the start of each year, the Chair and CEO develop an agenda plan for the year that identifies the major items of business for each meeting. This is reviewed and updated as the year progresses.

The Chair and CEO agree on the agenda for each meeting. Directors who wish to raise items that are not listed in the agenda plan are expected to raise them with the Chair in advance.

Board papers are normally distributed one week before the meeting date.

Board papers are made available in electronic format by default, with printed copies available on request. Directors are expected to ensure that papers (whether electronic or hard copy) are stored in a secure manner, and that any papers and other records (including emails, data and reports relevant to your role as a Director) are destroyed or returned when they leave the Board.

15. Committees

The role and composition of Board committees is normally reviewed at the first meeting of the calendar year, following an evaluation of current committees.

The process for evaluating each committee will be determined annually by the Chair of the Board, in consultation with the Chair of the respective committee. Among other things, the evaluation may address:

• whether continuation of the committee is necessary;
• whether the committee's terms of reference need to be updated;
• whether the composition of the committee is correct; and
• any impediments to it effectively carrying out its role.

This forms the basis of a Board paper outlining any proposed changes to Board committees.

16. Director protection

Rules 11.1 and 11.4 of the constitution address indemnity and liability of Directors.

11.1 Indemnity

11.1.1 To the extent permitted by the Corporations Act, the company indemnifies every person who is or has been an officer of the company against:

11.1.1(a) any liability (other than the liability for legal costs) incurred by that person as an officer of the company; and

11.1.1(b) reasonable legal costs incurred in defending an action for a liability incurred by that person as such an officer of the company, unless prohibited by the Act.

11.1.2 The indemnity does not extend to and is not an indemnity against any amount in respect of which the indemnity would otherwise be illegal, void or unenforceable or not permitted by law and does not operate in respect of any liability of the officer to the extent that liability is covered by insurance.

11.4 Liability

An officer of the company is not liable for the act, neglect or default of any other officer or for joining in any act or for any other loss, expense or damage which arises in the execution of the duties of her or his office unless it arises through her or his own negligence, default, breach of duty or breach of trust.

CHOICE maintains Directors and Officers liability insurance. Information on the current policy is provided in Appendix 4.

17. Board evaluation and development

The Board conducts a self-evaluation every two years usually around the end of the calendar year so that any outcomes can be incorporated into Board planning for the following year. The self-evaluation addresses the Board's performance in relation to strategy, governance, skills, papers, meetings and committees. The process is also used to identify collective and individual development needs.

The Governance Committee is responsible for advising the Board on the way in which the evaluation is conducted and the best way to address the results of the evaluation.

In addition, the Board commissions external reviews of its performance at least every five years, on the advice of the Governance Committee.

18. Director selection

Before nominations open for the election of Directors, the Governance Committee is responsible for undertaking an audit of the skills of Directors who are not facing election and advising the Board on the priority skills for vacant positions. The Board will determine the priority skills areas so that this advice can be provided to members considering standing for election to the Board, and so that it can be used as a guide by the Nominations Committee when assessing candidates.

The Board will appoint a Nominations Committee before the close of nominations, in accordance with Rule 6.6 of the constitution. The role of the Nominations Committee is set out in Rule 6.7 of the constitution and includes to assess candidates against the skill priorities identified by the Board, and to advise the Board on the information that should be provided to members as part of the election process. The Board determines the final form of this information.

Where a casual vacancy arises, the Board will, on advice from the Governance Committee, identify the skills required of the Director appointed to the casual vacancy. The Board may also from time to time identify a skill gap that could be addressed through co-option. In either of these cases, the Governance Committee will normally advise the Board on the process for identifying suitable candidates. The process for identifying candidates will vary depending on the circumstances but may involve inviting nominations from voting members, conducting a search process through Directors' networks or engaging a search firm.

The Board is committed to gender equality in Board composition. The Board will consider this target when seeking candidates for casual vacancies and co-option. The Board will encourage nominations from women in Board elections and present information on gender diversity within the Board for members to consider when voting.

The Board will also strive to ensure that the Board reflects the diversity of the Australian community in areas other than gender.

19. Director expenses

Directors do not receive any remuneration for services in their capacity as Directors but CHOICE may reimburse Directors for reasonable out-of-pocket expenses. Records of any payments made to Directors are submitted to the Board for approval (after payments have been made). Unless agreed otherwise, CHOICE books air travel and accommodation on behalf of Directors.

20. Director induction

Each new Director is provided with an induction manual and expected to attend an induction program, organised by the company Secretary. This typically involves a series of briefings with senior managers, covering:

• the company's strategy
• key areas of operations;
• metrics and reporting; and
• risks.

Directors may also request briefings on other issues. New Directors are also offered the opportunity to attend the Governance for Directors course or Company Director's course offered by the Australian Institute of Company Directors.

The Governance Committee is responsible for conducting an annual review of the induction program for new Directors.

21. Review of Directors' performance 

Prior to the annual election process, the Chair conducts a review of the performance of any Directors seeking re-election, in consultation with the other Directors, as set out in the Review of Directors Performance policy, Appendix 6.

22. Appendices

Appendix 1 – Register of Board policies

Appendix 2 – Delegations

Appendix 3 – Conflict of interest forms

Appendix 4 – Management liability insurance

Appendix 5 – CEO Performance Review policy

Appendix 6 – Director Performance Review policy

Appendix 7 – Risk Management policy

Ms Sandra Davey, Chair

Current Employment: CEO, Product Space

Directorships: Nil

Other Appointments: Advisor to Marketing and Fundraising sub-committee, Bush Heritage Australia; Consultant to Enex TestLab

Other Material Personal Interests: Nil

Mr Bill Davidson

Current Employment: Nil

Directorships: Pat and Stick's Homemade Pty Ltd; Streetwize Publications Pty Ltd

Other Appointments: Nil

Other Material Personal Interests: Nil

Ms Fiona Guthrie

Current Employment: CEO, Financial Accounting Australia

Directorships: Debt Repayment Service Ltd; Financial Literacy Australia

Other Appointments: ACCC Consumer Consultative Committee; Australian Government Financial Literacy Board; ASIC External Advisory Panel; External Advisory Panel to CEO – Commonwealth Bank.

Other Material Personal Interests: Nil

Ms Alexandra Kelly

Current Employment: Principal Solicitor, Financial Rights Legal Centre (NSW) Inc

Directorships: Nil

Other Appointments: Member, Australian Consumer Law Committee, sub-committee of Law Council of Australia; Consumer representative, Life Code Compliance Committee

Other Material Personal Interests: Nil

Mr Ben Slade

Current Employment: Managing Principal – NSW, Maurice Blackburn Pty Ltd (law firm)

Directorships: BJS&ACL Nominees Pty Ltd; Larly Pty Ltd

Other Appointments: Chair, Class Actions Committee, Law Council of Australia; Chair, Australian Consumer Law Committee, sub-committee of Law Council of Australia; Federal Court Liaison Committee, Law Council of Australia

Other Material Personal Interests: Nil

Mr Robert Southerton

Current Employment: General Manager, Gondwana Genomics Pty Ltd

Directorships: Gondwana Genomics Pty Ltd; Robert Grindley Family Trust; Robert Grindley Pty Limited; Gondwana Genomics Holdings Pty Ltd

Other Appointments: Nil

Other Material Personal Interests: Nil

Ms Anita Tang

Current Employment: Self-employed (Anita Tang Pty Ltd)

Directorships: Centre for Australian Progress; Murrawan Pty Ltd

Other Appointments: Nil

Other Material Personal Interests: Nil

Ms Helen Wiseman

Current Employment: Director, Cookinvest Pty Ltd; Group Chair, The Executive Connection (self-employment as a consultancy)

Directorships: Imalia; Bid Corporation Limited; BidCorp Audit Committee; WPG Resources Ltd

Other Appointments: Nil

Other Material Personal Interests: Nil

Ms Jennifer Zanich

Current Employment: Self-employed

Directorships: Scout4 Limited (Isle of Man)

Other Appointments: Advisor, Bullpen Capital (US); Advisor, UNSW Accelerator Innovation; Advisor, Autonomous Group Management Consulting Blockchain

Other Material Personal Interests: Nil

Read the accessible text version below, or download CHOICE 2016–17 Annual Review (PDF, 1.2MB)

In the second year of our three-year strategy, we started to see the impact of some of the changes that we set out to achieve in 2015.

Implementing our strategy

The four goals in our Strategy 2015 to 2018 are to: 

• Drive change in areas where we can have a significant impact for consumers 
• Expand through innovation to assist consumers and grow revenue outside our existing business model 
• Improve and grow our existing business, to ensure our long-term sustainability 
• Live up to the standards that we expect of others.

We had one of our best years in recent times in terms of campaign wins, with the federal government agreeing to take action on credit cards, rental rights and banking competition. The review of the Australian Consumer Law supported many of our priorities, and the ACCC started new work on airline passenger rights and consumer guarantees for new cars, following CHOICE investigations. 

We continued to experiment with new ways of helping consumers. We launched a new version of CluckAR – our app that now allows users to share locations where they have seen genuine free range eggs – and grew our online forum, CHOICE.Community, to more than 10,000 users. We also began testing a new energy switching service, which is intended to make it much easier for consumers to navigate retail electricity markets.

At the same time, we doubled down on improvements to the core business model that supports CHOICE's purpose – providing information, tools and recommendations to help consumers choose the products and services that are right for their needs. Our major priority was the health insurance market, where we launched two new online tools, Do I Need Health Insurance as well as a health insurance comparison tool. 

Much of our work was on technological improvements that, although important, were not immediately obvious to the public – like improving website speed, enhancing data security and disability accessibility, and replacing some of the legacy technology behind our website. We also put a lot of work into improving our program of email communications with new members.

The best sign of success from all of this effort was 4% growth in the number of CHOICE memberships, taking it to 182,494 as at 30 June 2017. This was our highest end-of-year result since 2010 and the biggest year-on-year growth in 10 years.

We also focused on our broader impact as an organisation, through a social impact strategy led by CHOICE staff and an environmental impact plan that will help us to become carbon neutral. We also developed new relationships with Indigenous organisations to shine a light on some of the scams that target Indigenous communities, which will be a bigger focus in 2017–18.

A strong financial position supporting investment in a stronger CHOICE

We entered 2016–17 with strong cash reserves and given the low interest rates on offer for term deposits, we examined how best to invest some of this cash. Our analysis of past performance showed that investing in the organisation typically produced strong returns, so that is what we did. Investing in growing the teams within CHOICE responsible for campaigns, innovation and developing digital products and services allowed us to achieve the results described in this report – including growth in memberships.

While we ended the year with a deficit of $0.9m (or $0.4m if the impact of a grant received in 2014–15 is disregarded), CHOICE remained in a strong position at 30 June 2017, with $11.2m in cash. This is well in excess of the cash reserves floor of $4.7m set by the Board. 

Further strategic investments are planned for the 2018 financial year. This is intended not only to generate greater financial returns in future years, but also to increase our returns in other areas, such as achieving change for Australian consumers, improving our broader social impact and reducing our carbon footprint.

In keeping with this strategy, the Board has approved a deficit budget for 2017–18. The Board will be carefully monitoring the additional expenditure we have approved for 2017–18 against an agreed set of outcomes whilst ensuring that our underlying financial position remains sound.

Effective governance

Governing an organisation as important as CHOICE, with the complex challenges it faces, requires a diverse and highly skilled Board. The Board worked hard through 2016–17 to improve our governance practices and ensure that we can continue to attract the skills that the organisation requires.

We bid farewell to two Board members – Frank Muller and Allan Asher – at the Annual General Meeting in November 2016. Frank had been on the Board for nine years, chairing the Campaigns and Advocacy Committee for much of that time. Frank played an important role in encouraging us to do more to help consumers who want to make environmentally sustainable choices. Allan's involvement with CHOICE stretched back to more than 30 years ago, when he was a senior executive of the organisation. We benefited from his deep experience of consumer issues and public policy in his three years on the Board.

Robert Southerton was elected to the Board in November 2016, having previously been a co-opted director, and Bill Davidson was re-elected. There was one casual vacancy, which in March 2017 was filled by Anita Tang. Anita brings extensive experience in public policy and campaigning, most recently from 12 years at the Cancer Council of NSW.

Nicole Rich, who had been Chair of the Board since 2013, stepped down from this role in July 2017. Nicole, whose term on the Board ends in November, has played an important role in lifting standards of governance, improving engagement with voting members, and encouraging CHOICE to increase its impact as a campaigning organisation. The Board and the organisation are both significantly stronger as a result of her leadership. 

Voting members

The Board is only able to do its role with the support of a strong community of voting members, which numbered more than 5700 as at 30 September 2017. 

In March 2017, we provided an opportunity for Victorian voting members to engage directly with the CEO and members of the Board, through a forum at the RACV Club. All voting members continued to receive regular updates on Board deliberations through an email after each Board meeting. 

This has been a big year with some significant achievements that have given us confidence in our ability to grow CHOICE's impact on behalf of Australian consumers. We thank all CHOICE members, and especially our voting members, for supporting our important work. 

Investing in Impact

A strong financial position allowed us to invest in growing CHOICE's ability to help consumers. 

CHOICE entered 2016–17 in a strong financial position, with $12.6m in cash. Most of this cash had been built up through surpluses over the past five years, totalling $8.3m. 

We flagged in last year's Annual Review that we planned to use some of this cash to invest in a stronger CHOICE, and that is what we did. Some of this investment was in our assets, such as:

• improvements to our building and support infrastructure
• major improvements to our website, which is the most important way in which we communicate with Australian consumers
• upgrading technology platforms that sit behind our website, which need to be secure and able to support future growth.

Some of the investment was also in improving our ability to adapt to a rapidly changing world, to ensure that CHOICE's impact grows rather than declines in the face of competition.

Increased expenditure on website development and content production allowed us to employ more staff to design, build and maintain high quality digital tools (work that had previously been outsourced). This has helped us to make a number of smaller improvements to our website, attracting more visitors to choice.com.au and encouraging more of them to take out membership.

Recognising that we need to expand the range of ways in which we help consumers, especially in complex markets, we increased expenditure on innovation through our New Things team, which had only commenced part-way through the prior year. The focus of this team is on experimenting with new ways to intervene in markets, with the intention of identifying new sources of revenue to support our future sustainability. Because most of this work involved early-stage experiments that have not yet resulted in new assets, the expenses are largely treated as operating rather than capital expenditure.

The results for the year ended 30 June 2017 show an overall deficit of $0.9m. Of this, $0.5m was due to drawing down upon a grant for work in the travel market, received in 2014–15. The balance of $0.4m largely represents expenditure on improvements and innovation in excess of what would have otherwise been a break-even result.

The investment in the organisation described above helped us to achieve an $862k increase in revenue, taking total revenue to a record level of $18.7m. This was driven in part by a 4% increase in memberships.

Mobilising consumers to change markets

CHOICE continued to fight for fair, just and safe markets in 2016-17 using all the tools at our disposal to make a difference for consumers. We had some big wins on long-running campaigns, and started work in new areas that matter to consumers.

1. Making health insurance fairer and easier to understand 

In our last Annual Review, we let you know that we had the health insurance market in our sights. This is a market where premiums have increased an average of 54.6% since 2009, and our research consistently shows that consumers find it hard to find the best deal. We approached this problem through a carefully designed package of online tools, investigations and campaigns.

In January, we launched DoINeedHealthInsurance.com.au, which gives clear answers to people who are trying to figure out complex income and tax arrangements around health insurance. In June, we backed this up with a new health insurance comparison tool, covering more than 15,000 policies.

These new tools were supported by in-depth investigations into how health insurance really works, with our journalists revealing that many people would be better off paying some taxes or penalties like the Lifetime Health Cover loading rather than taking out poor value insurance. At the same time, we argued for the federal government to improve the standard information that health insurers provide, to make it easier for consumers to understand what's covered. We also revealed problems with unexpected out-of-pocket costs, helped along by our campaign supporters – more than 1000 people sent in personal stories to a Senate inquiry into the issue.

2. Calling on airlines to play fair 

Unlike in the European Union where airlines have to compensate passengers for delays within their control, airlines in Australia offer little to people left in the lurch after a flight is delayed or cancelled. 

In July we launched Complane, an online tool to help people affected by delayed or cancelled flights to demand a remedy. Through the tool, we have helped submit more than 1000 complaints for people who have lost time and money. 

After an investigation into terms and conditions for domestic flights, in December we launched our Fare Play super complaint, asking the ACCC to take action. In March the ACCC announced that it would focus on the airline industry over 2017, noting that this decision had been informed by CHOICE's work. 

3. Uncovering what it's really like to #RentInOz 

In February, CHOICE worked with National Shelter and the National Association of Tenants' Organisations to release Australian-first research into the experiences of renters. We found that many renters are stuck in unsafe or unhealthy homes – 24% have doors or windows that won't close properly, 21% have experienced leaks or flooding, and 20% have had mould that they couldn't easily remove or that reappears. Many struggle to have these problems fixed. 

Thousands of individual stories poured in over 48 hours, generating a national discussion about the condition of rental properties. 

At meetings in Canberra, we called for politicians to focus on the quality and security of housing in Australia, as well as affordability. In May, the federal government announced that it would examine options to encourage longer leases, as one way of increasing security of tenure for renters.

4. Long consumer law battle gets promises for reform 

CHOICE has been pushing for better consumer laws since we were founded in 1959, helping to shape the original Trade Practices Act and the Australian Consumer Law. We worked through 2016–17 for further improvements to the Australian Consumer Law and had a major breakthrough with a government review supporting our calls for change. In August 2017, governments confirmed that they would support changes to the law so that: 

• it will be easier to get a refund or replacement for a product that has repeated small problems (like a lemon car or caravan) 
• businesses will have a new proactive obligation to sell safe products through a General Safety Provision 
• product recalls will be faster and more effective 
• businesses that break the law will face larger penalties.

Our 11th annual Shonky Awards in October 2016 were the biggest to date, receiving international media coverage after we shamed Samsung for unsafe products, Milo for misusing health star ratings and Vanish for flogging a carpet stain remover that performed worse than water. We saw some quick action from companies after they received the not-so-coveted Shonky award – Camel Milk Victoria swiftly removed misleading statements that their dairy product could help with everything from cancer to tuberculosis.

More wins for consumers

We also chalked up a number of other wins:

• The federal government commenced rolling out a new country of origin food labelling scheme. 
• After years of work from CHOICE, excessive credit card surcharges became illegal on 1 September 2016. 
• The ACCC took legal action against Thermomix following our Australian-first mass incident report into product safety failures with the kitchen device. 
• Following a joint campaign from CHOICE and Consumer NZ, all major airlines have stopped automatically ticking or adding extra costs when you're booking a flight.
• The ACCC launched legal action against flushable wipes manufacturers after we reported their misleading claims.
• We continued the fight for fairer financial advice, working with the federal government to secure the package of new laws that lifted standards for advisers and cracked down further on conflicted remuneration.

CHOICE supporters take action against unfairness

CHOICE's aim is to continue to grow our influence, by increasing the number of people that we work with to drive change. Over 2016–17, our number of campaign supporters grew to more than 112,000 and our social media following expanded dramatically, to more than 114,000 people on Facebook and 22,000 on Twitter. Combined with the active participants on the new CHOICE.Community platform, this means that we're now able to work with many more people so that we can make a bigger impact on the issues that matter most.

Finding new ways to help consumers

We built upon ideas launched last year and tested a bold new way of helping Australians in the electricity market

Through 2016–17 we tested a range of early-stage ideas to help consumers. The ideas that generated the greatest amount of consumer interest were CluckAR 2, CHOICE.Community and our energy-switching service.

CluckAR 2

CluckAR is a free augmented reality (AR) app for iOS and Android devices that helps shoppers avoid shonky free range eggs in the supermarket. The app gives power back to consumers, allowing them to scan a free range egg carton to quickly see which eggs live up to the 'free range' claim.

The first version of CluckAR had been launched in April 2016 and on 1 July 2016 won the NSW iAward for consumer innovation. 

The next version of the app, launched in April 2017, was designed to see whether crowdsourcing could solve a new problem: where are all the good eggs?

CluckAR 2 gathered more than 1000 user contributions, allowing us to create an in-app map of stores that sell genuine free range eggs. Meanwhile adoption and usage continued to grow, with 40,000 new users installing the app and 1.4 million egg cartons scanned in 2016–17.

CHOICE.Community

CHOICE.Community had been online for 10 days at the start of 2016–17. It was created to see if CHOICE could build an online platform for discussion of consumer issues. Our goal is for it to become the most helpful online community in Australia, a place where our members and supporters can gather and any Australian can come for friendly and reliable consumer advice. 

We sent invitations to our most engaged supporters through July–August 2016 and more than 10,000 people signed up. Since then, other CHOICE members have been joining gradually, through invitations in our email newsletters and magazines.

CHOICE.Community has developed into a helpful and positive place, with very low rates of abuse and close to zero spam. Community members made 12,771 posts which attracted 18,937 likes, and only 49 items were flagged for attention by moderators. Another strong measure of a healthy online community is how long it takes to get the first reply to a post. Ideally, community members should see the first reply within 24 hours. Our community's average response time hit that mark on 199 of the 365 days.

Energy switching service

Rising electricity costs consistently rate as the major source of household expenditure concern in our quarterly Consumer Pulse surveys. Our analysis of the energy retail market shows that this concern is justified – bad energy deals are costing Australian consumers more than a billion dollars extra every year. 

People should be switching away from bad deals but the plans are fiendishly complex and hard to compare. Only 21% of people have switched in the last three years and 55% have never switched. When consumers use a switching or comparison service, the discounts offered disappear very quickly, while the service walks away with a commission.

To attack this problem, we ran a small-scale trial of our own independent energy switching service, finding the best deals and refusing to take referral fees from retailers. Instead, we asked consumers to pay us a small fee in exchange for unbiased advice on the best deal we could find. This identified that we could deliver substantial savings for most consumers through detailed analysis of every deal on the market, and that some consumers were willing to pay for this advice. In 2017–18, we will be evaluating ways to grow this service so that it can assist more consumers.

A larger, stronger CHOICE

We grew memberships by attracting more people to CHOICE and encouraging them to stay longer.

Memberships grew by 4% over the year, from 175,433 to 182,494. This was the best end-of-year result since 2006–07 and compares favourably to the 1.5% growth in memberships achieved in 2015–16.

More than 80% of new members subscribed to CHOICE Online, which attracted 18% more new members than in the previous year. The most significant driver of membership growth was a 23.4% lift in visits to choice.com.au, most of which came from visitors who found CHOICE through a search engine.

We revamped our membership page to make it easier for prospective members to understand their options, and to offer one- and two-year memberships. We also focused on improving emails to new members, to help them understand the full value of a CHOICE membership and encourage them to stay longer. We delivered 9,233,596 emails across the year, with a high rate of 'click through' to CHOICE information.

Better insights from our members

If we want to attract and retain more members, it is critical that we understand what consumers want from CHOICE and how it can improve. To give us better insights, we replaced our lengthy, annual member satisfaction survey with two new approaches:

• A Net Promoter Score program, which asks a random selection of members and supporters whether they would recommend CHOICE to family or friends and why. 
• Short surveys on a number of pages on choice.com.au that invite visitors to rate and provide feedback on the content. These had received 29,379 responses by 30 June 2017, giving us valuable insight into what needs to change.

We also trialled new ways of researching how consumers use CHOICE, and what they expect from us, through in-home interviews and online research. This has informed changes to the way we present information both in our magazines
and online.

Stronger news and investigations

From the cartel-like stranglehold on the mattress industry to the world of lemon caravans, our investigations helped show consumers how to avoid being ripped off.

Knowing that food and groceries are core areas of interest for CHOICE members, we undertook our annual Supermarket Price Survey in early 2017, which looked at the average cost of a basket of 33 items at Coles, Woolworths and Aldi from 110 supermarkets across Australia. This was one of our largest mainstream media stories, attracting 31,981 page views on choice.com.au in May.

We also extended into taste testing of supermarket food products. Wholemeal breads and vintage cheddar cheese were the first cabs off the rank, both attracting significant interest from members and the mainstream media. And in other food news, we revealed the real calorific and nutritional value of 'healthy' burgers in major chains, with surprising results.

Looking to larger household purchases, we investigated the extortionate prices consumers have to pay for mattresses, with some retailers charging mark-ups as high as 200%. Published in January to coincide with our bed-in-a-box mattress test, this investigation had attracted 149,594 page views on choice.com.au by 30 June 2017.

We also took on the concert and sporting ticketing giants Ticketmaster, Ticketek and Viagogo by investigating and exposing what are effectively online ticket scalpers who are cashing in on consumer confusion. Our report led to an international campaign and an investigation by the ACCC.

We teamed up with ABC's Four Corners in early 2017 and mystery-shopped 240 pharmacies across the country to understand what they were advising people who reported feeling stressed. Many were found to be recommending products with little or no evidence to support their effectiveness.

Our analysis of the Federal Budget content in May attracted strong interest from members and the general public, with 23,500 unique page views on choice.com.au. We also provided an interactive quiz this year, which almost 2000 people attempted.

And finally, on the urging of CHOICE members, we looked into problems with lemon caravans. This investigation found similar problems with consumer rights to repairs, refunds and replacements that we had previously found in the new car market, feeding into our calls for reforms to consumer guarantee rights under the Australian Consumer Law.

Expanding our testing

We experimented with new areas of product testing and invested in growing our laboratories.

While there are some staples to CHOICE's product testing – like fridges, washing machines and televisions – we are always looking for new ways to help consumers. Learning from the experiences of our international partner organisations, we decided to test member interest in mattress reviews. Our initial test focused on newer types of online bed-in-a-box mattresses and judging by the consumer reaction, it was a resounding success. This told us that it was worth investing further, so we'll be following up with a larger test of standard springform mattresses in 2017–18.

We completed our first year-long test of solar panels in partnership with the CSIRO, which quickly became one of our most popular reviews. We've agreed to another test with the CSIRO in 2018, as part of our plan to provide better assistance to consumers considering household solar technology.

We also expanded into testing of smaller household purchases. We tested toilet paper and nappies for the first time in many years, attracting significant attention, especially through social media.

Not everything we tried was a success, however. Our reviews of non-espresso coffee machines, spiralisers and power banks attracted limited interest and are unlikely to be repeated.

To improve our data on child car seats, we formed a new partnership with the Child Restraint Evaluation Program (CREP). CREP is funded and supported by a variety of organisations such as NRMA, RACV and Kidsafe Australia, and produces unique data from its crash tests that we will be able to use to evaluate child car seats.

Our own testing laboratories saw the first expansion in some years, with the expansion of our thermal laboratory, which is used to test fridges. This will allow us to test more models, as well as do more testing for external clients, a growing and important source of revenue.

Breaking new ground online

In-house development allowed us to take ownership of all facets of our website. 

The main way we attract new people to CHOICE is through choice.com.au. This means that the ability to build top-quality digital tools is essential to our future sustainability.

We had previously outsourced website development, which came at a considerable cost and restricted our ability to make ongoing improvements. This also exposed us to risk because we did not control the intellectual property behind one of our greatest assets. To address this risk and put us in a better position to increase CHOICE's impact, over the past two years we have brought this work in-house, building our own teams of digital product managers, user experience specialists, interactive designers and developers.

During 2016–17, we started to see some of the outputs from this new approach. Our new health insurance tools – DoINeedHealthInsurance.com.au and our health insurance finder – were built entirely in-house, which allowed our subject matter experts to work alongside campaigners and digital developers. This unique mix of skills is what sets CHOICE apart from some of the businesses that purport to help consumers in the health insurance market.

We also designed, tested and built a new home page for choice.com.au, for launch in early 2017–18. This is intended to do a better job of showcasing the full range of CHOICE's work, including our campaigns, news and investigations.

Considerable effort also went into cleaning up and rebuilding much of the technical infrastructure that sits behind choice.com.au, ensuring that it is modern and adaptable, and improving data security. While the impact of some of this work is not obvious to many members, it is delivering measurable benefits – the average log-in time decreased from more than 10 seconds to less than two seconds.

Focusing on Impact

We reduced our carbon footprint and expanded our social impact through new partnerships.

Pathway to carbon neutral

In line with our commitment to become a carbon-neutral organisation by June 2018, we continued work to reduce electricity use and waste. Electricity consumption dropped by 18.3% as a direct result of the installation of LED lights in 2015–16 and the replacement of ageing air conditioning part-way through 2016–17. Our new, more efficient air conditioning plant will result in further reductions as it has a full-year effect in 2017–18, when we'll also be installing solar panels.

A staff-led environmental committee focused on how to reduce waste, with the implementation of co-mingled recycling for plastic, glass and metal to join our already existing cardboard and paper recycling, as well as compost bins and worm farms to dispose of kitchen waste.

Finally, we commenced the process to become certified as carbon neutral under the National Carbon Offset Standard (NCOS). This will establish a baseline of emissions for the 2015–16 period, against which we'll identify the reductions achieved in 2016–17 and use this to plan ongoing improvements in future years.

Increasing our social impact

During 2016–17 we rolled out our new social impact strategy, developed and championed by a committed group of CHOICE staff.

Staff consultation identified two key priorities: helping people who were experiencing domestic violence and/or homelessness settle into sustainable accommodation, and improving the quality of the local environment.

One of our first steps was to develop a partnership with the Women's and Girls' Emergency Centre (WAGEC), a non-profit homelessness service for women and families escaping domestic violence.

The main element of this partnership has been the donation of leftover test goods which have been used to furnish the Centre's accommodation services and clients' homes. These donations have a direct impact on the lives of women and children who have experienced domestic violence and homelessness.

Staff complemented this with $2000-plus in personal donations collected at events during the year. These funds have been well-received, going towards educational programs for children and young people, employment skills training, and therapeutic and wellness activities.

Our work to improve the local environment started later in the year, with staff organising a 'Clean Up Marrickville' event and taking responsibility for a Bushcare site in Mackey Park near the CHOICE building.

At the end of the financial year, a survey found that 97% of staff believed CHOICE was making a difference through its social impact activities.

Partnerships on issues that matter to Indigenous Australians

While CHOICE does a lot for Australian consumers, we have traditionally done little to directly advance the interests of Indigenous consumers. We knew that the only way to achieve this was in partnership with organisations that have strong connections to Indigenous communities.

We worked with the Indigenous Consumers Assistance Network, a consumer advocacy and financial counselling organisation, to develop a submission to the Review of the Australian Consumer Law on the problems Indigenous Australians face with unsolicited door-to-door sales. Together, we argued that unsolicited sales should be banned outright but that if this doesn't happen, Indigenous communities should be able to restrict or ban unsolicited sales in their local area. Unsolicited sales were recognised as a problem in the final report of the Review and we expect more work on this issue in 2017–18.

Late in 2016–17, we formed a new partnership with National Indigenous Television, which will allow us to work together to increase Indigenous awareness of consumer rights, and investigate some of the terrible scams that directly target Indigenous communities.

Meet our Board

CHOICE's Board brings a broad range of skills.

Sandra Davey (Chair)

Sandra is an experienced digital and internet executive and is managing director of Product Space. Her love is helping organisations transform or streamline their digital product management practices to improve agility, innovation and customer satisfaction. Prior, Sandra was general manager for a boutique IPTV/tech company, general manager of product for Australia's first 4G consumer wireless broadband service, managed Telstra's multimillion dollar cross-platform sport product portfolio, and was involved in bringing TiVo to the Australian market. Sandra served as a director and chair of the Australian Interactive Media Industry Association (AIMIA) and was one of the co-founders and inaugural directors of the Australian Domain Name Authority (auDA). For her ongoing contributions to the digital media industry, Sandra was inducted into AIMIA's Hall of Fame in 2015. She also serves on the Marketing Advisory Committee to the Board of Bush Heritage Australia. Sandra joined the Board in 2012, and is Chair of the Board, Chair of the Governance Committee and a member of the Business Innovation Committee.

Bill Davidson (Deputy Chair)

Bill is Managing Director of Australian Hearing, the nation's leading hearing specialist and largest provider of government-funded hearing services. Previously, Bill has operated at senior management levels in the Managed Services industry, both within the Private and Public sectors. He has extensive experience in the delivery of contracted, outsourced services here in Australia, and overseas in the UK and Southeast Asia. Bill was also the interim CEO of CHOICE in 2008 while we sought a new CEO. Bill is passionate about finding ways to provide fair competition and deliver a better deal for the Australian Consumer. Bill served on the CHOICE Board from November 2006 until August 2008. Following the appointment of Nick Stace in February 2009, Bill was co-opted onto the Board in November 2009, and then elected to the Board in November 2010. He is currently Deputy Chair of the Board and member of the Finance, Risk & Audit and Business Innovation Committees.

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 has been advocating for people on low incomes or in vulnerable circumstances to get a fair go, particularly in the financial services marketplace. For the past eight years, Fiona has been the 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 previously chair of ASIC's Consumer Advisory Panel. Fiona is currently a member of the ACCC's Consumer Consultative Panel, ASIC's External Advisory Panel, the Australian Government Financial Literacy Board and is a director of Financial Literacy Australia. Fiona holds a B.A., LLB and M.B.A. Fiona joined the Board in November 2015 and is a member of the Campaigns & Advocacy and Finance, Risk & Audit Committees.

Nicole Rich

Nicole is Executive Director, Family, Youth and Children's Law at Victoria Legal Aid and was previously its Director, Research and Communications. She has considerable experience developing legal research and policy and leading consumer campaigns, including most recently as Director, Policy and Campaigns at the Consumer Action Law Centre from 2007 to 2011. Nicole has practised in the private profession and in community legal centres. Nicole is committed to ensuring that the consumer interest is represented in policy debates and that consumers, particularly disadvantaged or vulnerable consumers, are given a voice on issues that affect them. Nicole holds a BA along with LLB (Honours). Nicole was appointed to the CHOICE Board in 2008 and is a member of the Governance Committee. She was Chair of the Board from 2013 to 2017.

Ben Slade

Ben is Managing Principal of the NSW practice of Maurice Blackburn, a national plaintiff and union law firm, where he specialises in consumer and other class actions. Ben worked at the Redfern Legal Centre and Legal Aid NSW before joining Maurice Blackburn 17 years ago. He has spent more than 30 years in the consumer movement in Australia in community education, consultation, media, lobbying and litigation. He has a passion for consumer rights and he recognises the need to adopt a range of strategies to achieve positive outcomes for consumers. Ben was appointed to the CHOICE Board in November 2013 and is Chair of the Campaigns & Advocacy Committee and a member of the Governance Committee.

Robert Southerton

Robert is an experienced professional in marketing, digital, analytics and statistics. He has a broad range of experience across the 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 holds a Foundations of Directorship qualification from the AICD, gained 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. Robert joined the Board in September 2014 and is a member of the Business Innovation, Finance, Risk & Audit and the Governance Committees.

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. Anita currently runs her own advocacy and campaigning consultancy working with a range of NGOs to bring about social change. Anita has also held senior roles in policy and advocacy at the Community Services Commission and the Social Issues Committee of the NSW Legislative Council. She has completed the Leadership, Organizing and Action: Leading change program through Harvard University, as well as the Stanford Executive Program for Non-Profit Leaders. Anita has served on the Boards of the Council for Intellectual Disability NSW and the Intellectual Disability Rights Service. She currently serves on the Centre for Australian Progress Board. She is a long-standing member of CHOICE and while at the Cancer Council led a number of collaborative projects with CHOICE, including campaigns against junk food advertising to children and the regulation and eventual ban of commercial solariums. Anita joined the Board in March 2017 and is a member of the Campaigns & Advocacy Committee.

Helen Wiseman

Helen is a Chartered Accountant, businesswoman and former KPMG tax partner with over 28 years business experience across a range of industries including financial services, manufacturing and distribution, energy and natural resources and pharmaceuticals. She is currently a founding director of Imalia, a for-purpose business established to empower women financially. Helen sits on a number of boards including Bidfood where she chairs the Audit and Risk Committee and is an Independent Non-Executive Director, WPG (Non-executive Director and Audit Committee Chair) and the Advisory Council of the Sydney Women's Fund. She is also the Patron for SHINE for Kids. Helen is also a professional mentor through The Executive Connection. Helen has a strong interest in seeing women are adequately represented in consumer advocacy. Helen joined the CHOICE Board in November 2014 and is Chair of the Finance, Risk & Audit Committee.

Jennifer Zanich

Jennifer is a senior corporate executive and start-up CEO with a strong entrepreneurial background. Most recently, Jennifer was the managing partner of Stacked VB, a venture-builder company that provides experienced, functional expertise. Her prior roles include being CEO and founder of Paloma Mobile, a company that delivered services to new users of smartphones, predominantly in the developing world. Prior to Paloma, Jennifer spent 10 years in the US where she successfully started and funded companies including SeeSaw Networks and Xumii (later acquired by Myriad Group), and was CEO of Wedgetail Communications. She is also experienced in corporate operations, strategy and marketing, having spent eight years as Microsoft's Marketing Director in Australia and Asia Pacific. Jennifer's strength is in developing actionable plans to help companies and teams transition to digital-based businesses and achieve their innovation agenda. She is an experienced Board member with over 15 years' Board experience in executive and non-executive roles including The Australian Venture Capital Committee, Capital Markets Technology and Sirca Technology and is an advisor to Bullpen Capital, a US Venture Fund. Jennifer was appointed to the Board in February 2015 and is Chair of the Business Innovation Committee and a member of the Campaigns & Advocacy Committee.

Read accessible text version below, or download Constitution of Australian Consumers' Association (PDF, 171kB)

Constitution of Australian Consumers' Association

ACN 000 281 925

a not for profit company limited by guarantee

Passed by Special Resolution of Members

November 28 2013

Contents

1 Nature of the Company

2 Purpose and objectives of the Company

3 Members of CHOICE

4 Members of the Company (Australian Consumers' Association)

5 Meetings of members

6 Directors

7 Meetings of the Board of directors

8 Chief Executive Officer

9 Minutes

10 Notices

11 Indemnity and insurance

12 Winding up

13 Accounts, audit and records

14 Miscellaneous provisions

Schedule 1 – Dictionary and interpretation

Schedule 2 – Transitional arrangements

1 Nature of the Company

1.1 Limited liability and guarantee

• 1.1.1 The Company is a public company limited by guarantee.
• 1.1.2 The liability of each member is limited to $1. This means that if the Company does not have enough assets to cover all of its liabilities upon winding up, each member must contribute up to a maximum of $1 to the assets of the Company.

1.2 Powers

• 1.2.1 The Company has all the powers of an individual and a body corporate but does not have the power to issue shares.
• 1.2.2 The Company may only exercise its powers and use its income, assets and profits for the purpose and objectives set out in rule 2.

1.3 Not for Profit

• 1.3.1 The income and property of the Company, from wherever it is derived, must be applied solely towards the promotion of the purpose and objectives of the Company set out in rule 2.
• 1.3.2 No portion of the income or property of the Company may be paid directly or indirectly, by way of dividend, bonus or otherwise to the members of the Company in their capacity as members of the Company.

2 Purpose and objectives of the Company

2.1 Recognising the inequality in bargaining power between consumers and businesses, the overall purpose of the Company is to work for fair, just and safe markets that meet the needs of Australian consumers. To achieve this purpose, the Company seeks to:

• 2.1.1 ensure that consumers are able to understand and use or defend their rights;
• 2.1.2 empower consumers to engage actively in markets and make informed choices that reflect their best interests and values;
• 2.1.3 drive transformation of markets to create better products and services at fair and competitive prices;
• 2.1.4 give consumers a voice in the debates that matter to them;
• 2.1.5 achieve strong consumer protection through appropriate laws and industry behaviour; and
• 2.1.6 ensure that consumers receive a fair deal.

2.2 The Company pursues its purpose and objectives by:

• 2.2.1 conducting research and testing in relation to products, services and markets;
• 2.2.2 promoting good practice in the production, marketing and delivery of products and services, including transparency around claims made about products and services;
• 2.2.3 promoting transparency around the price, quality, characteristics and safety of consumer products and services;
• 2.2.4 pursuing market and regulatory arrangements that enhance and protect the interests of consumers and ensure easy, effective redress for concerns about products, services or other conduct by suppliers;
• 2.2.5 raising awareness among industry, government and the broader community about issues that matter to consumers;
• 2.2.6 providing information, tools and services to meet the diverse needs of consumers; and
• 2.2.7 doing all other activities ancillary to, or necessary for, the fulfilment of the purpose and objectives of the Company.

3 Members of CHOICE

3.1 Description of a member of CHOICE

• A member of CHOICE is an individual or body corporate who subscribes to one or more of the CHOICE membership options approved by the Board.

3.2 Rights of members of CHOICE

• 3.2.1 A member of CHOICE is not a member of the Company for the purposes of the Act or this constitution and is not eligible for election as a director.
• 3.2.2 A member of CHOICE has no right to receive notices of, attend and be heard at general meetings or any right to vote at a general meeting of the Company.
• 3.2.3 A member of CHOICE may apply to become a member of the Company in accordance with rule 4.2.1.
• 3.2.4 The remaining provisions of this constitution referring to "members" do not apply to individuals or body corporates who are only members of CHOICE.

4 Members of the Company (Australian Consumers' Association)

Membership in the Company and rights granted by membership in the Company

4.1 Members of the Company

• 4.1.1 The Company has one category of membership, voting members as outlined in rule 4.2 (which includes life members as outlined in rule 4.3).
• 4.1.2 A reference to a “member” throughout this constitution is a reference to a voting member (and not to a member of CHOICE as set out in rule 3).
• 4.1.3 Additional categories of members, if recommended by the Board, may be created by the members in general meeting.
• 4.1.4 There is no limit on the number of members of the Company.

4.2 Voting members

• 4.2.1 Any individual who is a member of CHOICE may apply to become a voting member, subject to any eligibility criteria that the Board may determine and publish.
• 4.2.2 The Board may decide, in its absolute discretion, to accept or reject an application by a member of CHOICE to become a voting member. In exercising this discretion, the Board may consider any factors, including:
  • 4.2.2(a) the need to maintain and protect the role and reputation of the Company as an independent, impartial and unbiased commentator on products, services and markets;
  • 4.2.2(b) any actual or perceived conflict of interest that might arise if the person were to be elected to the Board; and
  • 4.2.2(c) any relationship the person may have with industry, business or government interests that might lead the person to promote interests that conflict with the purpose and objectives of the Company.
• 4.2.3 The Board is not required to, but may in its discretion, give reasons for a decision to reject an application by a member of CHOICE to become a voting member.

4.3 Life members

• 4.3.1 If, in the opinion of the Board, a member has made over a period of years a significant contribution to the Company, the Board may appoint that member to life membership.
• 4.3.2 Life members are not required to pay any fees to the Company.
• 4.3.3 Subject to rule 4.3.2, a life member has all the rights and privileges of a voting member and is subject to this constitution.

Membership fees

4.4 Fees

• The Board will determine and publish any fees that a member must pay in order to become or remain a member.

Ceasing to be a member

4.5 Ceasing to be a member

A member ceases to be a member:

• 4.5.1 two months after the member (other than a life member) ceases to be a member of CHOICE in accordance with rule 3.1;
• 4.5.2 if any fees referred to in rule 4.4 are not paid within two months of the due date;
• 4.5.3 if the member resigns from membership of the Company by giving written notice to the secretary, effective either on the date of receipt of the notice or any later date provided in the notice;
• 4.5.4 if the member is expelled under rule 4.6; or
• 4.5.5 on the death of the member.

4.6 Disciplining and removing members

• 4.6.1 If any member:
  
  • 4.6.1(a) wilfully refuses or neglects to comply with the provisions of this constitution; or
  • 4.6.1(b) in the opinion of the Board, engages in conduct which is unbecoming of a member or may be prejudicial to the interests of the Company, taking into account those factors set out in rule 4.2.2,
• the Board may resolve to expel the member from the Company and remove the member's name from the register.
• 4.6.2 At least two weeks before the meeting of the Board at which a resolution under rule 4.6.1 is considered, the Board must give to the member notice of:
  
  • 4.6.2(a) the meeting;
  • 4.6.2(b) what is alleged against the member; and
  • 4.6.2(c) the intended resolution.
• 4.6.3 The member must have an opportunity to speak or present a written statement at the meeting prior to the consideration of the resolution, to give any explanation or defence the member sees fit.
• 4.6.4 The Board may reinstate any member who ceases to be a member under rule 4.6.1, and restore the name of that member to the register, subject to any terms and conditions it sees fit.

4.7 Effect of ceasing to be a member

If any person ceases to be a member, the member remains liable to pay to the Company any money which, at the time of ceasing to be a member, is owed to the Company on any account and for any sum not exceeding $1 for which the member may be liable under rule 1.1.2 of this constitution.

4.8 Register of members

• 4.8.1 The Company must keep a register in accordance with the Act.
• 4.8.2 The register must record the following for each member:
  
  • 4.8.2(a) the full name of the member;
  • 4.8.2(b) the address of the member;
  • 4.8.2(c) the date that the member's membership started and ended; and
  • 4.8.2(d) any other information that the Board requires.

5 Meetings of members

5.1 Calling of general meeting

• 5.1.1 A majority of directors may call a general meeting whenever they see fit.
• 5.1.2 Members may call a general meeting in accordance with the Act.
• 5.1.3 A general meeting of the Company, to be called the annual general meeting, must be held at least once in each calendar year and within 5 months after the end of its financial year, or otherwise as required by the Act.

5.2 Postponement of general meeting

• 5.2.1 The Board may postpone the holding of any general meeting whenever it sees fit (other than a meeting requisitioned by members as provided by the Act).
• 5.2.2 A postponed meeting (as distinct from being adjourned under rule 5.5.3 or rule 5.6.3) must be held within 42 days of the original date of the meeting and the Company must give members notice of the postponed meeting in accordance with rule 5.4.

5.3 Technology

The Company may hold a meeting of its members at 2 or more venues using any technology that gives the members as a whole a reasonable opportunity to participate.

5.4 Notice of general meetings

• 5.4.1 Subject to the provisions of any relevant law relating to special resolutions and consent to short notice, at least 21 days’ notice of a general meeting must be given to each person who is at the date of the notice:
  • 5.4.1(a) a member of the Company;
  • 5.4.1(b) a director of the Company; and
  • 5.4.1(c) an auditor of the Company.
• 5.4.2 A notice of a general meeting must:
  • 5.4.2(a) be given in a way permitted by rule 10;
  • 5.4.2(b) specify the date, time and place of the meeting;
  • 5.4.2(c) if the meeting is to be held in 2 or more places, specify the technology that will available to members to attend;
  • 5.4.2(d) state the general nature of the business to be transacted at the meeting including any matters to be determined by special resolution; and
  • 5.4.2(e) include any other information required by law.
• 5.4.3 The non-receipt of notice of a members' meeting, or a failure to give notice of a members' meeting, does not invalidate any act, matter or thing done or resolution passed at the meeting if:
  • 5.4.3(a) the non-receipt or failure occurred by accident or error; or
  • 5.4.3(b) the member attended the meeting.

5.5 Quorum

• 5.5.1 The quorum for a meeting of the Company's members is 12 members and the quorum must be present at all times during the meeting.
• 5.5.2 In determining whether a quorum is present, individuals attending as proxies or attorneys are counted. However, if a member has appointed more than one proxy or attorney, only one of them is counted. If an individual is attending both as a member and as a proxy or attorney, the individual is counted only once.
• 5.5.3 If a quorum is not present within 30 minutes after the time for the meeting set out in the notice of meeting:
  • 5.5.3(a) where the meeting was called by the members or upon the requisition of members, the meeting is dissolved; or
  • 5.5.3(b) in any other case, the meeting is adjourned to the same day in the next week at the same time and place, or such other date, time and place that the Board specifies.
• 5.5.4 If no quorum is present at the resumed meeting within 30 minutes after the time for the meeting, the meeting is dissolved.

5.6 Procedure at general meetings

• 5.6.1 The chair of the Company will be the chair at every general meeting.
• 5.6.2 Where a general meeting is held and:
  • 5.6.2(a) there is no chair of the Company; or
  • 5.6.2(b) the chair is not present within 30 minutes after the time appointed for the holding of the meeting or is unwilling to act;
  • the deputy chair of the Company if present presides as chair of the meeting or, if the deputy chair is not present or is unwilling to act, the directors present may appoint a director to be chair of the meeting. If the directors do not appoint a director to be chair of the meeting, the members present may appoint a member to be chair of the meeting.
• 5.6.3 The chair of the meeting may, with the consent of the members present at the meeting, adjourn the meeting.
• 5.6.4 The chair of the meeting is responsible for the general conduct of the meeting and for the procedures to be adopted at that meeting. The rulings of the chair of a meeting on all matters relating to the procedure and conduct of the meeting are final and no motion of dissent from those rulings may be accepted.
• 5.6.5 The chair of the meeting may in her or his absolute discretion refuse to admit, or require to leave and remain out of the meeting, any person who is not a member, director or auditor of the Company.
• 5.6.6 The secretary of the Company is entitled to be present and to speak at any general meeting.
• 5.6.7 The auditor of the Company and any assistant of the auditor is entitled to be present and to speak at any general meeting on any part of the meeting's business that concerns the auditor in the capacity as auditor of the Company.
• 5.6.8 Any professional adviser of the Company, at the request of any director, is entitled to be present and, at the request of the chair, to speak at any general meeting.

5.7 Business of an annual general meeting

• 5.7.1 The business of an annual general meeting may include any of the following, even if not referred to in the notice of meeting:
  • 5.7.1(a) the consideration of the annual financial report, directors’ report and auditor's report;
  • 5.7.1(b) the appointment of the auditor; and
  • 5.7.1(c) the fixing of the auditor's remuneration.
• All other business transacted at an annual general meeting and all business transacted at any other general meeting is special business.
• 5.7.2 The business of the annual general meeting also includes any other business which under this constitution or the Act ought to be transacted at an annual general meeting.
• 5.7.3 The chair of the annual general meeting must allow a reasonable opportunity for the members as a whole at the meeting to ask questions about or make comments on the management of the Company.
• 5.7.4 If the Company's auditor or the auditor's representative is at the meeting, the chair of an annual general meeting must:
  • 5.7.4(a) allow a reasonable opportunity for the members as a whole at the meeting to ask the auditor or that representative questions relevant to the conduct of the audit, the preparation and content of the auditor's report, the accounting policies adopted by the Company in relation to the preparation of the financial statements and the independence of the auditor in relation to the conduct of the audit; and
  • 5.7.4(b) allow a reasonable opportunity for the auditor or their representative to answer written questions submitted to the auditor in accordance with the Act.

5.8 Notice of adjourned meeting

When a meeting is adjourned, new notice of the resumed meeting must be given if the meeting is adjourned for 1 month or more.

5.9 Business at adjourned meetings

A meeting that resumes after an adjournment may only deal with matters that were on the notice of the initial meeting.

5.10 How voting is carried out

• 5.10.1 A resolution put to the vote at a meeting of the Company's members must be decided on a show of hands unless a poll is demanded in accordance with rules 5.11 and 5.12. This does not apply to the election of directors, which takes place by ballot.
• 5.10.2 On a show of hands, a declaration by the chair is conclusive evidence of the result. Neither the chair nor the minutes need to state the number or proportion of the votes recorded in favour or against.
• 5.10.3 Unless otherwise required by this constitution or the Act, all resolutions of the Company are ordinary resolutions which are resolutions passed by more than 50% of the votes cast by members present at the meeting in person or by proxy or attorney and entitled to vote on the resolutions.

Note: In accordance with the Act, the Company may only modify or repeal the constitution or a provision of the constitution, or adopt a new constitution, by special resolution of the Company. A special resolution is a resolution passed by at least 75% of the votes cast by members entitled to vote on the resolution, either in person or by proxy or attorney, and which otherwise satisfies the requirements of the Act.

5.11 Matters on which a poll may be demanded

• 5.11.1 A poll is a formal vote cast in writing at a meeting of the Company.
• 5.11.2 A poll may be demanded on any resolution, except for the election of a chair or on the adjournment of a meeting.
• 5.11.3 A demand for a poll may be withdrawn.

5.12 When a poll is effectively demanded

• 5.12.1 At a meeting of the Company's members, a poll may be demanded by:
  
  • 5.12.1(a) at least 5 members entitled to vote on the resolution;
  • 5.12.1(b) members representing at least 5% of the votes that may be cast on the resolution on a poll; or
  • 5.12.1(c) the chair.
• 5.12.2 The poll may be demanded:
  
  • 5.12.2(a) before a vote is taken;
  • 5.12.2(b) before the voting results on a show of hands are declared; or
  • 5.12.2(c) immediately after the voting results on a show of hands are declared.

5.13 When and how polls must be taken

• 5.13.1 A poll must be taken when and in the manner the chair directs.
• 5.13.2 The demand for a poll does not prevent the continuance of a meeting for the transaction of any business other than the question on which a poll has been demanded.
• 5.13.3 The result of the poll determines the resolution of the meeting at which the poll was demanded.

5.14 Chair's casting vote

• 5.14.1 In the case of an equality of votes, whether on a show of hands or on a poll, the chair of the meeting has a casting vote in addition to any vote she or he may have in her or his capacity as a member or proxy or attorney.
• 5.14.2 The chair has a discretion both as to use of the casting vote and as to the way in which it is used.

5.15 Resolutions proposed by members

• 5.15.1 A member may only propose a resolution to be included as special business at a meeting where:
  
  • 5.15.1(a) the resolution has previously been approved by the Board; or
  • 5.15.1(b) members with at least 5% of the votes that may be cast on the resolution have given the Company 2 months’ notice of the resolution or the requirements of the Act have otherwise been satisfied.

5.16 How vote may be exercised

• 5.16.1 Subject to rules 5.17 and 5.18 at any general meeting of members, each member present has 1 vote on a show of hands and on a poll.
• 5.16.2 The vote may be exercised in person or by proxy or attorney.

5.17 Voting disqualification

A member who is within the two month period referred to in rules 4.5.1 or 4.5.2 is not entitled to vote at a general meeting unless that member makes the payments required under those rules at or prior to the general meeting.

5.18 Objections to right to vote

• 5.18.1 A challenge to a right to vote at a meeting of members:
  
  • 5.18.1(a) may only be made at the meeting; and
  • 5.18.1(b) must be determined by the chair, whose decision is final.

5.19 Who can appoint a proxy

• 5.19.1 A member may appoint an individual as the member’s proxy to attend and vote for the member at a meeting of the Company’s members. The proxy need not be a member.
• 5.19.2 The Board may determine the form of the instrument for appointment of a proxy.
• 5.19.3 The chair may exclude a person purporting to be a proxy from attending or voting at the meeting if the chair is not satisfied that the person has been validly appointed as a proxy or is the person named in the relevant instrument of appointment.
• 5.19.4 If a proxy is not named on the proxy form then the proxy is given to the chair of the meeting.
• 5.19.5 A proxy is not permitted to vote at a general meeting (including one that has been adjourned) unless the instrument appointing the proxy is received:
  
  • 5.19.5(a) at the Company’s registered office or through any technological means specified for that purpose in the notice convening the meeting; and
  • 5.19.5(b) at least 48 hours before the commencement time specified in the notice of meeting.
• 5.19.6 If the proxy of a member, and the member, are both present at the meeting, the proxy may speak and vote for the member with the consent of the member.

5.20 Attorney of member

An attorney for a member may do whatever the member could do personally as a member, but if the attorney is to vote at a meeting of members the instrument conferring the power of attorney or a certified copy of it must be produced to the Company at least 48 hours before the meeting, in the same way as the appointment of a proxy.

6 Directors

6.1 Number of directors

The Company has between 9 and 12 directors comprising:

• 6.1.1 9 elected directors, elected by the members in accordance with rules 6.5 and 6.8; and
• 6.1.2 up to 3 co-opted directors, co-opted by the Board in accordance with rules 6.9 and 6.10.

6.2 Who can be a director

• 6.2.1 Only members of the Company are eligible to be a director of the Company.
• 6.2.2 Any person who:
  
  • 6.2.2(a) is currently employed by the Company;
  • 6.2.2(b) was employed by the Company at any time in the 3 years before the Nomination Date; or
  • 6.2.2(c) provides consulting or independent contractor services to the Company, whether through a corporate entity or otherwise as at the Nomination Date,
  • cannot be a director of the Company.

6.3 Other skills and qualities of directors

• 6.3.1 An individual nominated for election or appointed as a director of the Company should also:
  
  • 6.3.1(a) hold governance experience commensurate with a position on the Board of the Company;
  • 6.3.1(b) have other competencies, skills and experience as set by the Board; and
  • 6.3.1(c) satisfy the factors set out in rule 4.2.2 to a high standard.

6.4 How to nominate

• 6.4.1 A nomination of a candidate for election as director must:
  
  • 6.4.1(a) be in the manner and form specified by the Board; and
  • 6.4.1(b) include a signed declaration from two other members of the Company indicating their support for the candidate's nomination.
• 6.4.2 A nomination of a candidate for election must be received at the registered office of the Company on or before the Nomination Date.
• 6.4.3 The Company must give notice in writing of the Nomination Date to each member at least 28 days before the Nomination Date.

6.5 Dealing with nominations

• 6.5.1 The Board may appoint a returning officer for the purpose of the nomination and election of directors. If the Board does not appoint a returning officer, the secretary will act as the returning officer.
• 6.5.2 The returning officer must not accept any nominations that do not meet the requirements set out in rules 6.2, 6.4.1 and 6.4.2.
• 6.5.3 If the number of nominations received is less than or equal to the number of positions to be elected, those candidates must be declared elected at the next annual general meeting. Any vacant elected director position remaining on the Board is taken to be a casual vacancy.
• 6.5.4 If the number of nominations received is more than the number of positions to be elected, a ballot must be held in accordance with rule 6.8.

6.6 Establishment of Nominations Committee

The Board may establish a Nominations Committee, to consist of the chair and an equal number of directors and members of the Company.

6.7 Role of the Nominations Committee

• 6.7.1 The role of the Nominations Committee is to assist the Company to identify individuals having appropriate competencies, skills and experience to serve as a director of the company, including qualities consistent with rule 6.3, to help achieve the purpose and objectives of the Company set out in rule 2.
• 6.7.2 The Nominations Committee may:
  
  • 6.7.2(a) evaluate all nominations including requesting written information on the candidates’ skills, qualifications and experience relevant to the criteria in rule 6.3 and, where appropriate, interviewing the candidate;
  • 6.7.2(b) provide information to the Board, that the Board in its discretion may provide to members, on the degree to which candidates meet the competencies, skills and experience requirements set by the Board, including the extent to which a candidate fulfils the criteria in rule 6.3; and
  • 6.7.2(c) undertake other activities consistent with the terms of this constitution and generally accepted principles of good corporate governance as the Board may determine.

6.8 Ballot

• 6.8.1 If a ballot is required, the returning officer must list in the notice of annual general meeting distributed to members:
  
  • 6.8.1(a) the maximum number of vacancies that may be filled at the annual general meeting under this constitution;
  • 6.8.1(b) a list of the candidates;
  • 6.8.1(c) any information provided by the Nominations Committee that the Board determines to include;
  • 6.8.1(d) information on how to vote (either electronically or by way of postal vote) and the Closing Date (as defined in rule 6.8.5); and
  • 6.8.1(e) any such other information as the Board determines to include.
• 6.8.2 Prior to any ballot for election of directors, the Board, subject to compliance with the Act, may prescribe the method or methods of voting, including by any electronic means, provided that a postal ballot is one of the prescribed methods of voting.
• 6.8.3 In the case of postal voting, members will be distributed:
  
  • 6.8.3(a) a ballot paper; and
  • 6.8.3(b) an unsealed envelope, bearing the address of the Company, and having space on the reverse side for the name, address and signature of the member to which it is sent.
• 6.8.4 The Board must ensure a secure method of identifying a member by reference to a personal identification code or any other manner approved by the Board where an electronic voting system is used.
• 6.8.5 Every member wishing to vote must do so by completing the electronic voting process or by returning the ballot paper to "The Returning Officer" by 5.00 p.m. Sydney time on the date (Closing Date) which is 3 days prior to the date of the relevant annual general meeting.
• 6.8.6 A member is permitted to vote in favour of any number of candidates equal to or less than the number of vacancies to be filled at the annual general meeting.
• 6.8.7 The Company must reject an electronic vote or ballot paper in circumstances where:
  
  • 6.8.7(a) the person who has exercised the vote is not registered as a member;
  • 6.8.7(b) it is not clear which candidate(s) the member wishes to vote for;
  • 6.8.7(c) the number of candidates for whom the member has voted is greater than the number of current vacancies; or
  • 6.8.7(d) the electronic voting process is completed or the ballot paper is received by the Company after 5.00 p.m. on the Closing Date.
• 6.8.8 The returning officer is responsible for the counting of votes, and must ensure that the Company completes counting all votes (other than those rejected), as recorded through the electronic voting process or on ballot papers, prior to the next annual general meeting.
• 6.8.9 The candidates receiving the greatest number of votes cast in their favour must be declared by the chair of the meeting to be elected as directors.
• 6.8.10 If two or more candidates receive an equal number of votes, and there are not enough vacancies for all of these candidates to be elected, the candidate(s) to be elected must be decided by lot.
• 6.8.11 Any candidate is entitled to appoint a scrutineer to be present during the counting of votes.
• 6.8.12 The chair will announce the outcome of the election at the next annual general meeting.

6.9 Power of the Board to appoint

The Board may co-opt up to 3 additional directors at any time to provide additional skills required by the Board.

6.10 Qualification of co-opted directors

• 6.10.1 Only individuals who satisfy rule 6.2 and, in the opinion of the Board, would be eligible under rule 6.3, may be co-opted as directors.
• 6.10.2 For the purposes of rule 6.10.1, the references to "Nomination Date" in rule 6.2 should be read as references to "proposed date of appointment".

6.11 Elected directors

Elected directors hold office:

• 6.11.1 from the end of the annual general meeting at which they are elected; and
• 6.11.2 until the end of the third annual general meeting after they are elected,

subject to rule 6.14.

6.12 Co-opted directors

Co-opted directors hold office:

• 6.12.1 from the time they are co-opted; and
• 6.12.2 until the end of the third annual general meeting after they are co-opted, or a shorter period as determined by the Board,

subject to rule 6.14.

6.13 Limit on consecutive terms of office

No director may serve for more than three consecutive terms of office (not including any term filled as a casual vacancy in accordance with rule 6.15.2(b)), unless exempted from this restriction by a resolution of the other directors, where the other directors determine that there are exceptional circumstances.

6.14 Ceasing to be a director

• 6.14.1 Directors may resign in writing to the Company.
• 6.14.2 Directors may be removed at a general meeting in accordance with the Act. The resulting vacancy may be filled at the general meeting.
• 6.14.3 A director ceases to be a director if she or he:
  
  • 6.14.3(a) becomes bankrupt or suspends payment or compounds with her or his creditors;
  • 6.14.3(b) becomes of unsound mind or a person whose person or estate is liable to be dealt with in any way under the law relating to mental health;
  • 6.14.3(c) is not present at 3 consecutive Board meetings without special leave of absence from the Board;
  • 6.14.3(d) ceases to be a member;
  • 6.14.3(e) becomes disqualified from being a director under the Act or any order made under the Act;
  • 6.14.3(f) enters into an employment relationship with the Company; or
  • 6.14.3(g) provides consulting or independent contractor services to the Company, whether through a corporate entity or otherwise.

6.15 Appointment

• 6.15.1 If there is a vacancy in an elected director position, the Board may appoint a person who satisfies rule 6.2 and, in the opinion of the Board, is eligible under rule 6.3, to fill that vacancy. For the purposes of this rule, the references to "Nomination Date" in rule 6.2 should be read as references to "proposed date of appointment".
• 6.15.2 Where a director is appointed to fill a vacancy arising:
  
  • 6.15.2(a) under rule 6.5.3, that director holds office until the end of the third annual general meeting after the annual general meeting at which the vacancy arose; or
  • 6.15.2(b) other than under rule 6.5.3, that director holds office for the remainder of the term of office of the person whose position on the Board she or he is filling.
• 6.15.3 The Board may continue to act despite any vacancy in directors.

6.16 General business management

• 6.16.1 The business of the Company is to be managed by or under the direction of the Board.
• 6.16.2 The Board may exercise all the powers of the Company except any powers that the Act or this constitution requires the Company to exercise in general meeting.
• 6.16.3 A rule made or resolution passed by the Company in general meeting does not invalidate any prior act of the Board which would have been valid if that rule or resolution had not been made or passed.

6.17 Borrowing powers

• 6.17.1 Without limiting rule 6.16, but subject to rule 1.3.2, the Board may exercise all the powers of the Company to borrow money, to charge any property or business of the Company and to issue debentures or give any other security for a debt, liability or obligation of the Company or of any other person.

6.18 Appointment of attorney

• 6.18.1 The Board may appoint any person(s) to be the attorney(s) of the Company for the purposes, with the powers and discretions (being powers and discretions vested in or exercisable by the Board), for the period and subject to the conditions it sees fit.
• 6.18.2 A power of attorney may contain the provisions for the protection and convenience of persons dealing with the attorney that the Board sees fit and may also authorise the attorney to delegate all or any of the powers and discretions vested in the attorney.

6.19 Negotiable instruments

• 6.19.1 Any two directors may sign, draw, accept, endorse or otherwise execute a negotiable instrument.
• 6.19.2 The Board may determine that a negotiable instrument, including a class of negotiable instrument, may be signed, drawn, accepted, endorsed or otherwise executed in a different way.

6.20 Validation of acts of directors and secretaries

Even if it is subsequently found that a person who has acted as a director was not properly elected, co-opted or appointed, the validity of:

• 6.20.1 the acts of that person as a director, and
• 6.20.2 decisions of meetings of the Board in which that person has participated,

is not affected.

6.21 Prohibition on being present or voting

• 6.21.1 Except where permitted by the Act, a director who has a material personal interest in a matter that is being considered at a meeting of directors:
  
  • 6.21.1(a) must not be counted in a quorum;
  • 6.21.1(b) must not vote on the matter; and
  • 6.21.1(c) must not be present while the matter is being considered at the meeting.
• 6.21.2 If a director who has a material personal interest in a matter that is being considered at a meeting of the directors is not prohibited by the Act from being present at the meeting and voting, the director may be present, be counted in the quorum and may be heard but may not vote on the matter.

6.22 Director to disclose interests

Each director must comply with the Act in relation to the disclosure of director’s interests.

6.23 No directors' remuneration

No director may receive any remuneration for her or his services in her or his capacity as a director of the Company.

6.24 Directors' expenses

• 6.24.1 Despite rules 1.3.2 and 6.23 the Company may permit payments for out-of-pocket expenses incurred in carrying out the duties of a director where the payments are within limits approved by the Board.
• 6.24.2 The Board must approve all payments the Company makes to its directors.

6.25 Financial benefit

• 6.25.1 Subject to rule 6.25.2, the Company must not provide any financial benefit to a director or any related party of a director, other than in accordance with rule 6.24.
• 6.25.2 Rule 6.25.1 does not prevent the Company from entering into a contract or arrangement with a company in which a director has an interest provided that the director has complied with her or his obligations under rules 6.21 and 6.22.
• 6.25.3 The Company must not make loans to directors, or provide guarantees or security for obligations undertaken by directors other than obligations which were undertaken by the director solely in promotion of the objectives of the Company.

6.26 Office bearers

• 6.26.1 The office bearers of the Company are:
  
  • 6.26.1(a) the chair;
  • 6.26.1(b) the deputy chair; and
  • 6.26.1(c) the secretary.
• 6.26.2 Office bearers are elected at the first directors’ meeting after the annual general meeting and hold office until the end of the first meeting of the directors held after the next annual general meeting, unless the officer bearer resigns from her or his position, ceases to be a director (where the office bearer is a director), or is removed by resolution of the Board.
• 6.26.3 Except for the secretary, only directors may be office bearers. Any director is eligible for election to any office bearer position.
• 6.26.4 Subject to this rule 6.26, the officer bearers are to be elected in such manner as the Board determines.

6.27 Delegation to committee of directors

• 6.27.1 The Board may delegate any of its powers to a committee of directors and revoke the delegation.
• 6.27.2 A committee must exercise the powers delegated to it in accordance with any directions of the Board. The exercise of the power by the committee is as effective as if the Board had exercised it.
• 6.27.3 The meetings and proceedings of any committee of directors are governed by the provisions in this constitution regulating the meetings and proceedings of the Board.

6.28 Delegation generally

• 6.28.1 For managing any affairs of the Company in any specified locality the Board may:
  
  • 6.28.1(a) establish any local committees, boards or branches;
  • 6.28.1(b) appoint any members of the Company to be a member of the local committee, board or branch;
  • 6.28.1(c) appoint any managers or agents, fix their remuneration and delegate to them any of the powers vested in the Board; and
  • 6.28.1(d) authorise the members for the time being of the local committee, board or branch to fill any vacancies on it and to act despite vacancies.
• 6.28.2 Any committee (including a committee of directors and a local board or branch) or person appointed to the committee, exercising delegated powers, must conform to any regulations that may be imposed by the Board. The committee may be authorised to sub-delegate any of the powers vested in it.

7 Meetings of the Board of directors

7.1 Convening meetings of the Board

• 7.1.1 The directors may meet together for the despatch of business and adjourn and otherwise regulate their meetings as they see fit.
• 7.1.2 The chair, the deputy chair or any three directors may at any time, and on their request the secretary must, call a meeting of the Board.

7.2 Technology meeting of the Board

• 7.2.1 A Board meeting may be held using any form of technology approved by the Board and specified in the notice of meeting.
• 7.2.2 A director may participate in a meeting by a form of technology not specified in the notice of meeting only with the prior approval of the chair.

7.3 Notice of meetings of the Board

• 7.3.1 Reasonable notice of a Board meeting must be given to each current director, other than a director on leave of absence approved by the Board.
• 7.3.2 A notice of a Board meeting must:
  • 7.3.2(a) be given in a way permitted by rule 10;
  • 7.3.2(b) specify the time and place of and, if relevant, the form of technology for, the meeting; and
  • 7.3.2(c) state the nature of the business to be transacted at the meeting.
• 7.3.3 A resolution passed at a Board meeting is not invalid just because a director did not receive notice of the meeting provided that:
  • 7.3.3(a) the notice was not received because of accident or error;
  • 7.3.3(b) before or after the meeting, the director notifies the Company of her or his agreement to the resolution; or
  • 7.3.3(c) the director attended the meeting.

7.4 Quorum

The quorum for a Board meeting is a majority of the directors entitled to vote. The quorum must be present at all times during the meeting.

7.5 Passing of directors' resolutions

• 7.5.1 A resolution of the Board must be passed by a majority of the votes cast by directors entitled to vote on the resolution.
• 7.5.2 The chair has a casting vote if necessary in addition to any vote she or he has as a director. The chair has a discretion both as to whether or not to use the casting vote and as to the way in which it is used.

7.6 Circulating resolutions

• 7.6.1 The Board may pass a resolution without holding a Board meeting if 75% of the directors entitled to vote on the resolution either:
  • 7.6.1(a) sign a document containing a statement that they are in favour of the resolution set out in the document; or
  • 7.6.1(b) otherwise provide their agreement to the resolution by any other method approved by the Board.
• 7.6.2 Separate copies of a document may be used for signing by directors if the wording of the resolution and statement is identical in each copy.
• 7.6.3 The resolution is passed when the last director signs or otherwise provides their agreement to the resolution as permitted under this rule 7.6.

8 Chief Executive Officer

8.1 The Board may appoint any person, not being a director, to the position of chief executive officer for the period and on the terms (including as to remuneration) the Board sees fit.

8.2 The chief executive officer is not a member of the Board, but may attend meetings of the Board except where the Board otherwise decides.

8.3 The Board may, upon terms and conditions and with any restrictions it sees fit, confer on a chief executive officer any of the powers that the Board can exercise.

8.4 Any powers so conferred may be concurrent with, or to the exclusion of, the powers of the Board.

8.5 The Board may revoke or vary:

• 8.5.1 an appointment; or
• 8.5.2 any of the powers conferred on the chief executive officer.

8.6 If the chief executive officer becomes incapable of acting in that capacity the Board may appoint any other person, not being a director, to act temporarily as chief executive officer.

9 Minutes

9.1 The Board must ensure that:

• 9.1.1 minutes are taken and kept of all general meetings, meetings of the Board and resolutions without a meeting; and
• 9.1.2 in the case of minutes of meetings – the minutes are signed within a reasonable time after the meeting by the chair of the meeting or the chair of the next meeting; or
• 9.1.3 in the case of minutes of resolutions without a meeting – the minutes are signed by a director within a reasonable time after the resolution is passed,

as required in accordance with the Act.

10 Notices

10.1 Any notice, document or other communication required or permitted to be given under this constitution or law may be given in any manner (including through the use of technology) so long as such manner complies with:

• 10.1.1 the law; and
• 10.1.2 any policies and procedures relating to the giving and receiving of notices, documents and other communications as determined by the Board.

11 Indemnity and insurance

11.1 Indemnity

• 11.1.1 To the extent permitted by the Act, the Company indemnifies every person who is or has been an officer of the Company against:
  • 11.1.1(a) any liability (other than the liability for legal costs) incurred by that person as an officer of the Company; and
  • 11.1.1(b) reasonable legal costs incurred in defending an action for a liability incurred by that person as such an officer of the Company, unless prohibited by the Act.
• 11.1.2 The indemnity does not extend to and is not an indemnity against any amount in respect of which the indemnity would otherwise be illegal, void or unenforceable or not permitted by law and does not operate in respect of any liability of the officer to the extent that liability is covered by insurance.

11.2 Insurance

• 11.2.1 The indemnity does not extend to and is not an indemnity against any amount in respect of which the indemnity would otherwise be illegal, void or unenforceable or not permitted by law and does not operate in respect of any liability of the officer to the extent that liability is covered by insurance.
  • 11.2.1(a) conduct involving a wilful breach of duty in relation to the Company; or
  • 11.2.1(b) contraventions of the Act in respect of which the Act does not permit such premiums to be paid.

11.3 Director voting on contract of indemnity or insurance

Despite anything in this constitution, a director is not precluded from voting in respect of any contract or proposed contract of indemnity or insurance, merely because the contract indemnifies or insures or would indemnify or insure the director against a liability incurred by the director as an officer of the Company or of a related body corporate.

11.4 Liability

An officer of the Company is not liable for the act, neglect or default of any other officer or for joining in any act or for any other loss, expense or damage which arises in the execution of the duties of her or his office unless it arises through her or his own negligence, default, breach of duty or breach of trust.

12 Winding up

12.1 If the Company is wound up or dissolved, the amount that remains after such winding up or dissolution and the satisfaction of all debts and liabilities will be transferred to another organisation with similar objects and purposes which is not carried on for the profit or gain of its members as determined by the members of the Company.

12.2 If the Company is endorsed as a deductible gift recipient by the Commissioner of Taxation under Division 30 of the Income Tax Assessment Act 1997 and such endorsement is revoked, the Company must transfer to another organisation which is endorsed as a deductible gift recipient as determined by the members of the Company any surplus representing:

• 12.2.1 gifts of money or property made for the principal purpose of the Company;
• 12.2.2 contributions made in relation to an eligible fundraising event held for the principal purpose of the Company; and
• 12.2.3 money received by the Company because of such gifts and contributions.

12.3 If the members do not make the necessary determination under rules 12.1 and 12.2, the Company may apply to the Supreme Court to determine the organisation or organisations to whom the transfers are to be made.

13 Accounts, audit and records

13.1 Accounts

• 13.1.1 The Board must cause proper accounting and other records to be kept in accordance with the Act.
• 13.1.2 The Board must distribute copies of every financial statement (including every document required by law to be attached to it) as required by the Act.

13.2 Audit

• 13.2.1 Subject to the Act, a registered company auditor must be appointed.
• 13.2.2 The remuneration of the auditor must be fixed and the auditor's duties regulated in accordance with the Act.

14 Miscellaneous provisions

14.1 Rights of inspection

• 14.1.1 The Board, or the Company by a resolution passed at a general meeting, may authorise a member to inspect books of the Company.
• 14.1.2 A member other than a director does not have the right to inspect any document of the Company, other than the minute books for the meetings of its members and for resolutions of members passed without meetings, except as provided by law or authorised by the Board or by the Company in general meeting.
• 14.1.3 Directors have the rights of inspection and access provided by the Act.

14.2 Confidential information

Except as provided by the Act, no member (not being a director) is entitled to require or receive any information concerning the business, trading or customers of the Company or any trade secret, secret process or other confidential information of or used by the Company.

14.3 Execution of documents

Without limiting the ways in which the Company may execute documents under the Act and subject to this constitution, a Company may execute a document if the document is signed by:

• 14.3.1 two directors of the Company; or
• 14.3.2 a director and a company secretary of the Company; or
• 14.3.3 any other person authorised by the Board for that purpose.

14.4 Formalities omitted

If some formality required by this constitution is inadvertently omitted or is not carried out the omission does not invalidate anything, including any resolution, which would have been valid but for the omission, unless it is proved to the satisfaction of the Board that the omission has directly prejudiced any member financially. The decision of the Board is final and binding on all members.

14.5 Alterations

• 14.5.1 If the Company is endorsed as an income tax exempt fund, a tax concession charity or a deductible gift recipient by the Australian Taxation Office, before making any alterations to this constitution (in particular rules 1.3, 2, 6.2, 6.3, 6.23, 6.24, 6.25, 6.27, 6.28, 8.3, 8.4, or 12) the Board must consider:
  • 14.5.1(a) whether those alterations may affect the entitlement of the Company to that endorsement; and
  • 14.5.1(b) whether, as a term of the endorsement, the Company is required to notify the Australian Taxation Office or any other government authority of the alterations to this constitution.

14.6 Transitional Arrangements

Notwithstanding any other rule of this constitution, the transitional arrangements set out Schedule 2 to this constitution shall apply from the date of adoption of this constitution.

Schedule 1 – Dictionary and interpretation

1 Replaceable rules excluded

The replaceable rules contained in the Act do not apply to the Company.

2 Definitions

In this constitution:

• 2.1.1 Act means the Corporations Act 2001 (Cth) and includes any amendment or re-enactment of it or any legislation passed in substitution for it;
• 2.1.2 Board means the directors assembled as the board of the Company;
• 2.1.3 Company means Australian Consumers’ Association ACN 000 281 925;
• 2.1.4 member means either a voting member or a life member, but does not include a member of CHOICE;
• 2.1.5 Nomination Date means the date prescribed by the Board as being the final date for acceptance of nominations for the office of director, which will be at least 90 days prior to the next annual general meeting;
• 2.1.6 Nominations Committee means a committee established under rule 6.6 for the purpose of, among other things, identifying candidates for election or appointment as directors; and
• 2.1.7 officer means, for the purposes of rules 11.1, 11.2, 11.3 and 11.4, a director or secretary or a member of a local committee, board or branch appointed under rule 6.28.1.

3 Interpretation

• 3.1.1 Reference to:
  • 3.1.1(a) one gender includes the others;
  • 3.1.1(b) the singular includes the plural and the plural includes the singular; and
  • 3.1.1(c) a person includes a body corporate.
• 3.1.2 Except so far as the contrary intention appears in this constitution:
  • 3.1.2(a) an expression has in this constitution the same meaning as in the Act; and
  • 3.1.2(b) if an expression is given different meanings for the purposes of different provisions of the Act, the expression has, in a provision of this constitution that deals with a matter dealt with by a particular provision of the Act, the same meaning as in that provision of the Act.
• 3.1.3 "Including" and similar expressions are not words of limitation.
• 3.1.4 Headings and any table of contents or index are for convenience only and do not form part of this constitution or affect its interpretation.

Schedule 2 – Transitional arrangements

1 Directors

1.1 Existing Directors

The elected directors holding office following the annual general meeting at which this constitution is adopted will for the purposes of these transitional arrangements be the "Existing Directors".

1.2 Retirement of Existing Directors

• 1.2.1 Three Existing Directors shall retire at each annual general meeting following the adoption of this constitution.
• 1.2.2 The three retiring Existing Directors will be selected based on the date of each Existing Director’s most recent election or appointment to office (Election Date). The three Existing Directors with the earliest Election Date(s) will be selected to retire.
• 1.2.3 Where two or more Existing Directors share the same Election Date, the Existing Director(s) who retire at that annual general meeting must be selected by lot.
• 1.2.4 A director who retires in accordance with this clause 1.2 ceases to be an Existing Director for the purposes of these transitional arrangements.

1.3 Casual vacancies

• 1.3.1 If an Existing Director ceases to be a director under rule 6.14 of this constitution:
  • 1.3.1(a) the Board may appoint a director to fill the vacancy in accordance with rule 6.15 of the constitution; and
  • 1.3.1(b) a director so appointed will be treated as the Existing Director whose position they have assumed for the sole purpose of determining her of his term of office under clause 1.2.2 of this schedule,
  • however,
  • 1.3.1(c) if no director is appointed to fill the vacancy by the date of the next annual general meeting, the Existing Director who formerly held that position shall, for the purposes of these transitional arrangements, be deemed to retire at that annual general meeting in accordance with clause 1.2.1 of this schedule.

2 Office bearers

The office bearers holding office immediately prior to the adoption of this constitution shall continue to hold office until the first Board meeting following adoption of this constitution, at which meeting the officer bearers stipulated in this constitution shall be elected or nominated as required.

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