Information for New
Members of Crown
Entity Boards
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Commission, March 2008
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Outline of content
1 What are Crown entities and where do they fit in the
State services environment?
2 How do Ministers influence Crown entities?
3 Accountability and scrutiny of Crown entities
4 Developing effective relationships
5 Governing a Crown entity
6 Expectations of board members
7 Applying public sector values
8 Additional resources
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2 Ministers influence Crown
entities in various ways…
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… through making board appointments
Mostly made by Ministers; ICE board members are
appointed by the Governor-General.
Ministers’ recommendations for appointment almost
always go to the Cabinet Appointments and Honours
Committee and often to the government caucus.
Appointments are for a fixed term.
Appointees may be offered a second or subsequent term
of office but there is no guarantee of this.
Ministers and the Governor-General have powers of
removal.
No compensation or other benefit for loss of office.
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… by participating in an on-going dialogue
with entities..
For example:
Meetings
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Ministers typically hold regular meetings with the board chair (or with
senior management acting under authorisation from the board) to
discuss strategic issues. Monitoring department representatives will
often be present
Ministers may also have periodic meetings with the full board
Regular reporting

There are requirements are in place for periodic reporting by entities
Briefings
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For their part, boards are expected to advise their Minister in advance of
any major initiatives or developments
See also ‘no surprises’
Ideally, informal engagement between boards and responsible
Ministers should precede
and
inform
Crown
copyright:
Statemore
Servicesformal processes
Commission, March 2008
wherever possible.
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The Managing For
Outcomes/Results
Cycle
… by participating in formal strategic
direction setting processes, for which
there are various channels…
(1) Letter of Expectation
This can be a valuable way to initiate the strategic planning process and is often
the subject of prior consultation between Minister and entity
A letter of expectation sets out a Responsible Minister’s
expectations for:
The Crown entity’s strategic direction
Its governance and performance; and
His/her specific priorities for the planning period
Monitoring and information expectations
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(2) Statement of Intent (SOI)
The SOI is the centrepiece of the accountability
relationship between a Crown entity board and its
Minister
Through the preparation of its SOI a board outlines its
strategic thinking and future intentions, and frames its
actions (it is expected that the SOI process will be driven by the
board, not by management)
Should reflect Government objectives for both the sector
and for individual Crown entities, and wider Government
policy initiatives and themes
Ministers should be given sufficient time to review and
comment on drafts. Within limits, as set out in the CE
Act, they may direct SOI content
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Through various other processes and
agreements, such as …
Output agreements

Detail the outputs to be supplied, including those paid for by third
parties where the Minister has some responsibility for setting fee
levels or service specifications
Memoranda of Understanding (MOU)
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Mostly used to document the Government’s performance
expectations of a Crown entity and enable the Minister and the
entity to record their understanding of the basis for monitoring,
and accountability of the entity. The MOU supplements the SOI
Annual Report
An assessment of performance against that outlined in the SOI
Ongoing performance reporting, eg quarterly reports
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And by monitoring Crown entity
performance…
Ministers ‘oversee and manage’ Crown entities (and are
answerable to Parliament for their entities’ performance)
They obtain advice from monitoring departments about
the entities' effectiveness and efficiency, and how any
risks will be managed
Ministers can require Crown entities to supply a wide
range of information
They rely on good reporting from the entity and are
assisted by monitoring departments as their agents
Ministers are also able to formally review a Crown
entity’s operations and performance at any time
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Ministers have powers to direct some
Crown entities
Ministers may direct a Crown Agent or ACE (eg,
in relation to policy or implementation).
Powers of direction are likely to be used
infrequently, and there are limits on the ability to
direct. Ministers must consult with the affected
entity
Whole of Government directions may be issued
Directions must be in writing. They are tabled in
Parliament and notified in the Gazette.
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