Review of ASA Performance 2002 - 2008

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The first phase of the review involved the Board providing key stakeholders with a report on ASA achievements over the previous five years, the ASA Constitution, the latest updated Corporate and Annual Operational Plans and ASA Annual Reports. Stakeholders were asked to examine the documents and provide feedback to the Board on how ASA is performing, areas where it could improve its performance or provide new services and what the Board should do to further explore stakeholder views and implement changes.

Summary of Responses

The Board received responses from DAFF, Grains Council of Australia (GCA), Australian Seed Federation (ASF), Certification Agencies and a number of ASA members. Key points from these responses are summarised below.

Department of Agriculture, Fisheries and Forestry (DAFF)

The main issues identified were:

  • DAFF was happy with ASA’s performance and would be prepared to extend the existing licence;

  • the licence would be amended to require more stringent written reporting requirements and at least two in-person meetings per year in future;

  • DAFF had made a policy decision to remove DAFF appointees to Boards of bodies like RIRC’s and ASA, hence Mr Kelly would not be renominated by DAFF at the expiry of his current term;

  • industry feedback to DAFF showed that industry is largely supportive of the ASA and considers that ASA has effectively performed its functions and supports the reissuing of the licence to ASA for another 5 year term.

However some suggestions were made, including

  • Review of the governance structure of ASA with a view to an improved balance of membership (currently 6 industry members and 1 DAFF representative).

  • Strengthening of the role of ASA in investigating and adjudicating on improper certification practices.

  • Review of the need to have NATA accreditation for field inspection activities as there may be sufficient expertise within industry for a cheaper alternative.

  • Change of inspection fee practices. Currently ASA charges an inspection fee for potential, not actual, areas registered for certification. This is seen to compromise seed quality and production as companies seek to minimise costs. It has been suggested that a slightly higher fee be charged based on tonnage labelled.

  • Consideration of the broadening of ASA’s funding base into the future.

Grains Council of Australia (GCA)

Key feedback from the GCA was that it:

  • is happy with ASA’s performance in relation to OECD, ISTA and establishing technical standards and is satisfied with the current level of consultation;

  • will consult with ASF and consider how GCA and ASF will appoint an independent Director to replace Mr Kelly

  • will consider further whether the number of Directors should be reduced to 5 but the current thinking is that 7 is preferable;

  • has received no complaints from growers about the level of communication from ASA and considers that the preferred means of communication are consultation through member organisations plus website content and periodic presentations to grower meetings;

  • is happy with the current balance in staffing arrangements but that the Board should consider having 1 or 2 non-Directors on the Selection Panel for the new CEO; and

  • considers that the ASA fees and charges “aren’t broke so don’t fix them”.

Australian Seed Federation (ASF)

The main issues arising from consultation with the ASF was that:

  • ASF members and exporters are happy with ASA’s performance in relation to OECD, ISTA and establishing technical standards but asked that ASA be vigilant about the danger of raising the bar above that set for our overseas competitors;

  • regular communication with ASF members and exporters on ASA’s work in reviewing the technical standards is essential and the Board should give consideration to circulating Minutes of ASATAC meetings;

  • exporters believe that ASA should have a greater role in export facilitation with OECD and non-OECD countries and should get involved in bilateral negotiations;

  • ASF, GCA and the ASA Board should take into account the importance of having an independent Director when considering Mr Kelly’s replacement;

  • the ASA Board should consider amending the ASA Constitution to make specific provision for the inclusion on the ASA Board of an exporter with extensive skills in the international trade of seed;

  • ASF, GCA and the ASA Board need to take into account the importance of having an exporter as a member of ASATAC;

  • the ASF Policy Council will be considering the effectiveness of ASATAC and may make recommendations on alternative means of addressing technical issues and the need for the ASA Board to address conflicts of interest by ASATAC members on many issues;

  • ASF is generally happy with ASA communications but recommends that the Board consider circulating to ASA members a 1-page summary of all Board and ASATAC meetings;

  • no changes are needed to current staffing or fee arrangements;

  • ASF supports the GCA recommendation that the Board should consider having 1 or 2 non-Directors on the CEO Selection Panel in April 2008;

  • ASA needs to provide more commercially focused services;

  • ASF members do not want the technical bar raised;

  • ASF members believe there should be greater export representation on the Board;

  • there is strong support for maintaining and independent Director on the ASA Board to provide advice in the area of corporate governance; and

  • as there was no real preference for the future structure of ASATAC, ASF has decided to allow the ASA Board to determine its structure.

ASA Members

While all responses were positive and many simply indicated that ASA was performing well, specific issues raised were as follows:

  • recommendation that ASA alter its Constitution to include an objective under Clause 4 to promote and expand the use of OECD and AOSCA certification by breeders, agents and farmer end users and amend its Strategic Plan to add ASA’s Planned Outcomes that ASA take action to increase the use of OECD and AOSCA certification by breeders, agents and end users;

  • request that ASA remain vigilant against some sections of the Australian seed industry that seek to diminish technical standards in the guise of providing efficiencies and/or cost savings to industry;

  • comment that there is significant room for improvement in the ASA communication with its stakeholders, in particular lucerne seed producers and a request that ASA involve Lucerne Australia in relevant technical discussions and seek its opinion on matters of impact on their industry.

ASA Board Response

At its meeting on 9 April 2008 the ASA Board considered all responses to the survey and made the following decisions:

Board Membership

  • That the number of Directors should remain at seven (three GCA, three ASF and one independent) and acknowledged the importance of having an independent Director on the ASA Board to fill any gaps in the skill requirements.

  • To recommend to ASF, GCA and ASA members that the ASA Constitution be amended to require ASF and GCA to jointly recommend an independent person as a Director following advice from DAFF that DAFF will no longer appoint a representative to the Board.

  • That Mr Gary Kelly be appointed as Independent Director to fill the casual vacancy that will occur on the Board following signing of the new licence with DAFF and until the August 2008 Annual General Meeting and to call for ASF and GCA to jointly nominate an Independent Director at the AGM.

  • To amend Clause 18.4 of the ASA Constitution to ensure that expertise and experience in seed exports and international trade of seed are added to the skills required to be represented on the ASA Board but noted that an exporter is already required to be included on ASATAC.

  • That current remuneration of Directors has been fixed since the start of ASA and agreed that the current rates remain appropriate but should be kept under review and noted that the DAFF-appointed Director receives no remuneration but agreed that an Independent Director will be remunerated.

Performance of OECD/ISTA Functions

  • Noted a request from ASF that ASA be vigilant about the danger of ASA raising the technical bar above that set for our overseas competitors and acknowledged that the NATA accreditation scheme for certification agencies and the need to address past deficiencies in complying with the OECD Rules has resulted in additional costs to certification agencies and their clients but gives an undertaking to remain vigilant in ensuring that the Australian seed industry is not placed at a competitive disadvantage against its overseas competitors.

  • Acknowledged the highly competitive environment in which certification agencies operate and the importance of ASA investigating and adjudicating on differences between agencies in how OECD Rules and the ASA Technical Standards are applied and agreed to remain vigilant in performing this role in order to protect the integrity of the schemes administered by ASA and provide a sound basis for competition.

  • Acknowledged that ASA should have a proactive role in export facilitation with OECD and non-OECD countries in relation to seed certification and seed testing matters but agreed that this should not extend to phytosanitary or general regulation matters and agreed that ASA will collaborate with ASF and GCA to achieve these outcomes.

Structure of ASATAC

  • Acknowledged the potential conflict of interest of ASATAC members on some issues and agreed to ensure that ASATAC recognises and addresses this by various means, including the use of ad hoc external technical expertise where appropriate.

  • Noted that it may be appropriate for a Board member to attend at least one ASATAC meeting each year.

Structure and Role of PVMP

  • Noted that there is strong support for the PVMP from GCA and that no changes are needed.

ASA Communications

  • Acknowledged the need for regular consultation with ASA members on technical issues under consideration by ASA and agreed to provide ASA members, through a members-only section of the website, a one-page summary of issues discussed or under consideration at each ASATAC and ASA Board meeting.

  • Acknowledged the importance of Lucerne Australia as a stakeholder and valuable source of advice to ASA on technical issues and agreed to improve communication links, including contributions to LA newsletters, and ensure that Lucerne Australia is regularly consulted on technical issues.

  • Acknowledged the value of ASA playing a role in promoting the technical basis and benefits of the certification schemes administered by ASA in facilitating national and international trade in Certified Seed and agreed to recommend to ASF and GCA that the ASA Constitution be amended to add a new Object to communicate the technical basis and benefits of the certification schemes administered by ASA.

ASA Fees and Charges and Staffing Arrangements

  • Noted that ASF and GCA do not see any need for changes to current staffing or fee arrangements but that one certification agency respondent to DAFF suggested that ASA’s funding base be broadened to reduce fees on the area inspected. Directors acknowledged this minority view but noted that the current fee structure had proved to be very robust and effective in addressing equity issues and revenue variations due to adverse seasonal conditions and agreed to maintain the current fee structure.

Involvement of Independent Person in Selection of New CEO

  • Acknowledged the value in involving at least one independent representative of GCA or ASF in the selection of the next CEO and agreed to invite Mr Christopher Melham to participate in the selection process at the April 2008 Board meeting.

Directors agreed that stakeholder feedback to the review had been good, the process had been very worthwhile and the outcomes should further strengthen the organisation. The 2008 Annual General Meeting of ASA approved the proposed amendments to the ASA Constitution.

 

Hugh Roberts

ASA Chairman

April 2009