BWP TRUST ANNUAL REPORT 2015
23
CORPORATE GOVERNANCE
The responsible entity is committed to fostering a strong governance culture using a
framework based on the ASX Corporate Governance Council’s Corporate Governance
Principles and Recommendations (“ASX Principlesâ€).
CORPORATE GOVERNANCE FOR
THE RESPONSIBLE ENTITY AND
THE TRUST
The governance framework is embedded in the Trust’s
compliance plan (referred to under the heading Risk control and
compliance on page 27) to ensure ethical behaviour and
transparency and to protect unitholders’ interests.
This statement outlines the main corporate governance practices as
they relate to the responsible entity and to the Trust. These practices
were in place throughout the year and at the date of this report.
Some of the recommendations in the ASX Principles require
modification when applied to externally managed listed
entities like the Trust. Investors in an externally managed listed
entity generally invest in the listed entity on the basis of the
management expertise of the responsible entity.
In some instances the disclosures in relation to the
recommendations are made in relation to the responsible entity in
its corporate capacity. In other instances the disclosures relate to
the listed entity (the Trust) being managed by the responsible entity.
Several recommendations have been acknowledged in the ASX
Principles as not being applicable to externally managed entities.
For example in Principle 1 where it is a requirement to disclose the
respective roles and responsibilities of the Board and management
or to have a diversity policy are not applicable. Similarly there
are recommendations in Principle 2 concerning Board structure,
Principle 4 concerning AGMs, and Principle 8 relating to director and
executive remuneration which are not applicable.
Notwithstanding, wherever it is possible to provide additional
disclosures that demonstrate the Board’s and the responsible
entity’s commitment to a strong governance culture, these have
been included in this statement.
RELATIONSHIP BETWEEN
THE RESPONSIBLE ENTITY
AND WESFARMERS
The responsible entity is a wholly owned subsidiary of
Wesfarmers. The responsible entity is responsible for managing
the affairs of the listed entity which is the BWP Trust. In return,
the Trust pays a management fee to the responsible entity. The
details of the management fee are set out in Note 2 in the notes
to the financial statements. The Board of the responsible entity
is responsible for overseeing the management arrangements
between the responsible entity and the Trust. The key documents
governing the management arrangements include the Compliance
Plan and the Trust Constitution.
Other important relationships include:
>> A majority of the property income of the Trust is received from
wholly owned subsidiaries of Wesfarmers.
>> The Trust has purchased property fromWesfarmers
subsidiaries, and utilised a Wesfarmers subsidiary, Bunnings,
as project manager on property developments.
>> Wesfarmers is a substantial unitholder in the Trust, and details of
Wesfarmers’ unitholding can be found on page 55 of this report.
>> All directors of the responsible entity are ultimately appointed
by the sole shareholder, Wesfarmers Limited.
>> The responsible entity and Wesfarmers have one director
in common.
Further information regarding the relationship and transactions
with Wesfarmers is detailed in Note 16 in the notes to the financial
statements. Details of transactions with Wesfarmers are also
provided in announcements released to ASX and published on the
Trust’s website.
ASX WAIVER
The Trust holds a waiver from the ASX (“waiverâ€), which allows
the responsible entity to enter into certain leasing transactions on
behalf of the Trust with Bunnings, a related party, without the need
to obtain unitholder approval under Listing Rule 10.1.
The waiver is subject to certain conditions including disclosure
of new leases, that lease agreements are substantially on the
same terms and conditions established by the parties for leases
of Bunnings Warehouse properties, and appropriate rent review
provisions are in place.
The waiver was last renewed on 17 June 2014 and applies for
six years.
GOVERNANCE
