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ANNUAL REPORT 2016

REWARDING MEMBER LOYALTY

ANNUAL REPORT 2016

B | RACV 2016 ANNUAL REPORT

RACV EXISTS to improve the lives of Victorians by addressing their needs in the areas of mobility, home and leisure and continuing to be their advocate.

WE WILL DO THIS BY > growing our membership at least as fast

as the Victorian population

> delivering more products and services to more members

> making membership more meaningful for all members.

CONTENTS

ANNUAL REVIEW

President & Chairman’s Report 2

Managing Director & CEO’s Report 4

Delivering Member Benefits 6

Investing in Our People 8

Investing in Victorian Communities 10

Directors’ Report 12

Board of Directors 14

RACV 2016 ANNUAL REPORT | 1

CORPORATE GOVERNANCE STATEMENTThe Board of Directors of Royal Automobile Club of Victoria (RACV) Limited is responsible for the corporate governance of the company and its subsidiaries (the Group).

RACV’s detailed 2016 Corporate Governance Statement is available on our website at www.racv.com.au.

This statement outlines the principal corporate governance practices and policies that the Board has established to ensure that the interests of members are protected. These practices and policies were in place throughout the financial year (unless otherwise stated) and are current as at the date of this statement, being 31 August 2016.

Although not a listed entity, RACV is a major public company and the Board supports the ASX Governance Principles and Recommendations. The Board has adopted a Governance framework that reflects many of these Principles and Recommendations, as relevant to a mutual organisation.

http://www.racv.com.au/wps/wcm/connect/racv/Internet/Primary/about+RACV/corporate/governance-framework

2 | RACV 2016 ANNUAL REPORT

PRESIDENT & CHAIRMAN’S REPORT

On behalf of the RACV Board of Directors I am pleased to present the Chairman’s Report for the 2015–16 financial year.

The past 12 months has been an exciting and eventful time for RACV. After almost 15 years of service, Colin Jordan stepped down in March as Managing Director and CEO. RACV grew and prospered under Colin’s leadership and on behalf of the Board I would like to once more thank him for his very significant contribution.

Following an extensive search to find the best person to lead our organisation through its next phase of creating and delivering high value to members, we appointed Neil Taylor as RACV’s new Managing Director and CEO.

This change brought with it the opportunity to review how the Board and management can build a stronger and more relevant RACV, provide members with increased benefits and ensure the long-term sustainability of our organisation.

It is in this context, that I am pleased to report that the Board has approved a new strategic plan.

Its key features are: making membership more meaningful and relevant for all members; growing membership at least as fast as the Victorian population; and growing the products held by members in the areas of mobility, home and leisure.

The world we operate in is increasingly complex and competitive and we recognise the importance of preparing for future challenges by becoming more innovative and agile.

To achieve this, we will start by making a significant investment in our organisational capabilities over the coming year as well as improving our technology and e-commerce platforms. The first initiative, focused on the needs of members, is a brand-new website and mobile app. The new-look racv.com.au will go live before the end of 2016 and will make it much easier for members to use our services and find relevant information and advice. The mobile app will allow members to access RACV services anywhere, anytime, on their preferred device.

We will also devote significant effort to meeting members’ needs in their home, developing a greater range of non-car mobility products and services and creating a wider range of leisure products.

While an important focus during the year has been planning for the future, we continued to invest in our Club and resorts.

Royal Pines

580community grants across Victoria

70motoring events supported throughout the state


This includes the redevelopment of our resort at Cape Schanck, the completion of a major family water park at RACV Royal Pines Resort and the commencement of operations at our RACV Goldfields Resort.

A further highlight was the delivery of $185 million in member benefits.

Our financial performance in 2015–16 was sound. The full-year result was affected by a number of external factors, including lower returns from reserves invested in capital markets and the increased number of claims paid to members resulting from natural disasters, including fires and floods that severely affected parts of Victoria. The very purpose of RACV is of course to be there for our members at those critical times when they most need our trusted help and support.

Our profit after tax of $47 million was underpinned by our core motoring services and in many respects reflects the significant breadth and diversity of the organisation’s activities. Overall, the Board regards the result as satisfactory given the weak global markets for investment and the impact of major natural perils on the insurance business.

RACV remained committed to representing members’ interests and our advocacy ensured that members’ voices were heard on issues which are important to them.

We invested approximately $6.3 million in the wider Victorian community through our community support activities, grants, advocacy and information programs, which is described in more detail on page 10.

With our strong financial position, trusted brand, dedicated and committed staff and a new strategic plan, RACV is exceptionally well-placed to grow membership and continue to increase the value delivered to members over coming years.

Kevin W White President and Chairman of the Board

Royal Pines

$185min value returned to members

$47mnet operating profit

“”

RACV remained committed to representing members’ interests and our advocacy ensured that members’ voices were heard on issues which are important to them.

5500seniors attended Years Ahead program


40

Royal Pines

School

MANAGING DIRECTOR & CEO’S REPORT

I am delighted to present my first annual review of RACV’s performance.

RACV is one of Victoria’s most recognised and respected organisations, a position well earned through building a strong and trusted relationship with our members over more than a century. Members and staff from the past have built the company we have today and I am proud to have been given the opportunity to take RACV forward.

During the last 12 months, member take-up of our broad range of products and services within our motoring, mobility, home and leisure portfolios remained strong. Overall, we saw growth in some business areas, especially at our resorts, and we maintained market share in others.

Members saved $185 million over the year, including $126 million through our Years of Membership Benefit loyalty program. Members also saved $40 million through RACV’s Show Your Card & Save program, with more than 100 partners and $19 million at our resorts and on RACV products.

We worked hard over the year to make it easier for all members to interact with RACV.

We made a significant investment in a new digital telephony system in our member contact centres to allow members to use a range of new options, including web chat. Our focus on providing a vastly enhanced on-line experience gained strong momentum and as mentioned in the Chairman’s report, we will shortly launch our new website and associated mobile application. Additionally, we made major improvements to the usability and performance of My Membership Online, which

now has 215,000 registered users, an increase of almost 60 per cent on last year.

Members’ needs were also top-of-mind in the relocation of several RACV shops to more convenient positions in shopping precincts and the introduction of multi-lingual staff.

MotoringIn a competitive and changing roadside assistance market, RACV maintained its position as market leader with 1.71 million vehicles now covered by RACV Emergency Roadside Assistance. This included 460,000 members protected by our premium roadside assistance products, Total Care and Extra Care.

We increased the roadside assistance benefits available to members who live in growing outer suburban areas and we doubled the Extra Care towing allowance from 30 kilometres to 60 kilometres.

The number of members with RACV motor insurance policies grew to 908,000, consolidating RACV’s position as the number one provider of motor insurance in Victoria.

A highlight was the strong performance of Intelematics, a company 90 per cent owned by RACV. Intelematics recorded a 47 per cent increase in sales on the previous year. The company is a world-leader in the provision of location-based mobility services to automotive, GPS and mobility brands in Australia, New Zealand and North America. It also established a joint venture with automobile associations in the United Kingdom, the Netherlands and Austria to help develop and operate connected car services in Europe.

MobilityRACV recognises that members want to be connected to the people and places that are important to them, by provision of transport solutions that extend beyond ownership of a car.

26,000school children educated in pedestrian and bike safety

58,099homes covered by Emergency Home Assist (45 minutes average response time)


40

Royal Pines

School

Through our surveys, market research, community support programs and engagement with the community transport sector in Victoria, we continued to advocate for improvements to the operation, coverage and quality of transport options available across the state.

As an example, RACV members are increasingly using bicycles as a mode of transport and leisure. Throughout the year we advocated strongly for an integrated approach to developing the state’s transport infrastructure to meet the needs of the growing number of cyclists and to ensure their safety.

There are now 50 RACV Melbourne Bike Share stations conveniently located across the city and approximately 170,000 rides were taken during the year. An estimated 7000 cyclists, many of them RACV members, participated in cycling events supported by RACV. These popular events included the RACV Great Victorian Bike Ride, RACV Great Ocean and Otway Classic Ride and RACV Ascent.

Home RACV continues to be a trusted provider of home services. The number of members subscribing to RACV Emergency Home Assist increased by more than 8000 during the year, with 58,000 homes now covered. We responded to approximately 36,000 home emergencies, an annual increase of 19 per cent. The number of RACV Home and Content Insurance policies held in 2015–16 was 765,000 and our claims staff managed approximately 30,000 home and contents claims during the year, an average of 82 claims each day.

LeisureThere were a number of milestones achieved in RACV’s diverse leisure portfolio. Total room nights booked at the RACV Club and our resorts increased by 10 per cent to more than 315,000 for the year.

Member and guest ratings, including TripAdvisor and survey feedback, indicated that RACV continued to provide an exceptional level of service and satisfaction. Overall, the RACV Club was rated at 4.5 out of five and our resorts rated 4.6.

The RACV Goldfields Resort commenced operation in November, providing members with a new destination in central Victoria. In December we started the redevelopment of RACV Cape Schanck

Resort to provide members with a quality leisure experience on the popular Mornington Peninsula. This work is on-track for completion in mid-2018. Our upgrade of the RACV Hobart Apartment Hotel will be completed before the end of 2016.

Looking forwardRACV intends to make membership more meaningful for all members. We have some wonderful products and services and we believe these can be made relevant and attractive to more members. We are also developing innovative new products to provide members with a broader range of motoring and mobility services, help them in their home and give them great experiences with family and friends during their leisure time. By growing our membership and the number of products held by members, we will make RACV an even stronger organisation and deliver increased benefits for all members.

In a dynamic and technology-driven world, we will further develop our digital capability to ensure that our online and mobile presence meets members’ needs and expectations. We will also adapt and tailor our communications to individual member preferences.

As a mutual organisation, RACV exists to improve the lives of members and their communities. I take this opportunity to welcome new members to RACV and thank current members for their continued loyalty.

I also express my appreciation to the RACV Board for the opportunity to lead this wonderful organisation and the support that Directors have given me in setting a renewed path for RACV. Together with the leadership team and staff, I am looking forward to the next phase of RACV’s growth and development for the benefit of current and future members.

Neil Taylor Managing Director and Chief Executive Officer

48,000new travel insurance subscriptions

$19msaved by members at RACV resorts and purchasing RACV products


DELIVERING MEMBER BENEFITS

1.8mroadside and home emergency assistance calls

53,000respondents to RACV public transport, congestion and outer suburban surveys

$756,000saved on Royal Melbourne Show tickets

GIFT CARD

$1.2m saved by members on holiday and attaction tickets

400home, contents and motor insurance claims paid to members every day

215,000members using My Membership online – 60% increase

137,000rounds of golf at RACV Club and resorts

1.71mvehicles with Emergency Roadside Assistance

$1msaved by RACV members on Woolworths WISH Gift Cards46,000

RACV touring maps sold

1432children rescued from locked cars


8000 students and teachers involved in RACV renewable energy/ new technology program Energy Breakthrough

$3.2m saved on movie tickets

908,000 motor insurance policies

765,000 home and contents insurance policies

315,000 nights stayed at RACV Club and resorts

137,000 comments on Facebook

48 accredited RACV Auto Centres across Victoria

66,000free2go roadside members

326,000members covered by Bike Assist

170,000Melbourne Bike Share rides

175,000 RACV Drive School lessons

87% of Emergency Roadside Assistance breakdowns attended in an hour

38


Looking after the safety, well-being and development of our people is fundamental to our positive workplace culture and critical to delivering the best outcomes for our members.

Occupational Health and SafetyRACV remains committed to the Corporate Safety Objective of eliminating work related illness and injury across all worksites. This commitment includes a refreshed Occupational Health and Safety Policy focusing on safety systems and processes. The Policy is promoted across all RACV worksites.

As part of this refresh, RACV enhanced its internal safety incident reporting system and procedures to incorporate changes to regulatory requirements and to align the corporate safety framework with the Self-Insurers’ National Audit Tool (NAT). Our application of the NAT requirements at all RACV facilities ensures a consistent approach to managing workplace safety that fully satisfies the relevant state OHS legislation. External safety surveillance audits confirm RACV’s safety management system is compliant with NAT requirements.

Following a number of targeted safety initiatives developed in conjunction with employees, the total number of workers’ compensation claims decreased by 27 per cent during the year. All workplace injuries are investigated and remedial actions introduced to minimise the risk of repeat injuries.

RACV is committed to helping injured employees resume work and we provide return to work programs to transition employees back to their pre-injury role as soon as possible. Our active management of workers’ compensation claims

continues to reduce the number of active injury claims for compensation.

Our annual Health & Safety Week is popular, with employees taking advantage of a wide range of activities, including skin cancer screening, vision testing, health risk assessment and nutrition counselling. Also in 2016, more than 600 employees took advantage of RACV’s free annual influenza vaccination program.

Diversity in RACVRACV promotes equal opportunity and offers support and flexibility to all employees regardless of their gender, political views, ethnicity, culture, disability, age, sexual orientation or religious beliefs. In accordance with the requirements of the Workplace Gender Equality Act 2012, RACV lodges an annual public report with the Workplace Gender Equality Agency.

Employee DevelopmentThe biennial My Say @ RACV Employee Attitude Survey, conducted in October and November, shows that employees remain committed to RACV and hold positive views toward the organisation and our future. The level of employee engagement remains high and the results indicate a healthy organisation, in some areas well above Australian benchmarks. The response rate of 76 per cent is the highest since the My Say survey started in 2002.

We retained a focus on ensuring that all employees have the appropriate skills and expertise to undertake their roles. Employees are offered a range of courses and programs; and we actively encourage employees to increase their experience through short-term secondments and internal recruitment for vacancies.

RACV’s workshop series Managing@RACV helped more than 300 participants improve their knowledge of key RACV processes, practices and policies.

INVESTING IN

OUR PEOPLE

RACV OCCUPATIONAL HEALTH AND SAFETY

Performance Indicator 2015–16 2014–15

Number of Incidents Reported 296 350

Total Number of WorkCover Claims 49 67

Total WorkCover Claims Frequency 10.6 15.0

Total Lost Time Injury Frequency 7.6 8.6

Median Days Lost 6 7

RACV WORKFORCE GENDER PROFILE

Category Female Male Total

Board 4 7 11

Executive Management 2 4 6

Management/Supervisory 229 267 496

Professional 150 118 268

Admin/Frontline 1,293 521 1,814

Trades/Apprentices/Trainees 78 342 420

Total 1,756 1,259 3,015


Our Manage to Perform leadership program was extended to include 28 managers from our Southern Resorts.

Twenty-seven leaders from across RACV business units participated in the RACV’s Leadership Counts program, designed to develop the leadership capabilities of our middle management team; and 14 senior managers participated in advanced development programs.

PathwaysRACV’s Graduate Program is an important part of the organisation’s recruitment and talent management strategy. Each participant completes three rotations of six months in various disciplines within RACV businesses. In 2015–2016 we employed 14 graduates, nine females and five males;

and since the program began in 2004, RACV has employed 63 graduates, 40 females and 23 males.

As part of our broader social investment activity we introduced an Internship Program to help appropriately qualified people to gain a foothold in the employment market. It offers participants a six-month paid position at RACV, providing practical on-the-job experience and a development program designed especially for people in the early stages of their career. The first intake of 10 Interns commenced in March/April 2016.

63 RACV graduates

employed since 2004


INVESTING IN

VICTORIAN COMMUNITIESRACV is committed to making a relevant and worthwhile contribution to the Victorian community. We are one of Victoria’s most trusted independent voices and continued to represent members’ interests on issues that are important to them. We are also committed to directly supporting and contributing to our wider community through our many programs, partnerships, grants and philanthropic activities.

Over the past year, RACV successfully advocated for the release of real-time public transport travel information, development of better walking, cycling and bus connections and a forward plan for public transport in regional Victoria to complement the metropolitan strategy.

We called for 24/7 clearways and other actions to reduce congestion and improve bus flows, particularly for the major thoroughfares of Hoddle Street and Punt Road. Having argued for many years that level crossing removals should be a priority, RACV welcomed the commitment by the state government to remove 50 railway level crossings over eight years.

RACV’s state budget submission sought commitments to duplicate the remaining sections of highways serving major regional cities and improve the safety of other rural roads. We were pleased to see a significant boost for roads and public transport funding this year.

RACV believes the Federal Government must invest in nationally important transport infrastructure projects for the benefit of all Victorians. Key projects we support include the completion of the Metro Ring Road at Greensborough to connect with EastLink and the Eastern Freeway, the Melbourne Metro Rail tunnel (which has now commenced) and the Western Distributor to provide an alternative to the Westgate Bridge. These projects, together with calls for important reforms in transport taxation and investment in transport safety, were important components of RACV’s federal election campaign.

RACV supported members with free lifestyle, wellbeing and safety education programs. Our ever-popular Years Ahead program for seniors was attended by more than 5500 people and we distributed more than 10,000 copies of our transport options guide. We helped nearly 26,000 young people to prepare for travelling safely through a variety of programs in primary and secondary schools.

Our commitment to support Victorian communities was reinforced by a five-year partnership with Phillip Island Nature Parks. This partnership has already delivered to Victoria an award-winning penguin-viewing experience at the iconic Penguin Parade. In February we held the first of five annual Member Days at Churchill Island, with approximately 2000 members and their families attending.

A number of other important community support programs were provided across Victoria in partnership with Little Athletics, Travellers Aid, FareShare Kitchen Gardens, Melbourne Recital Centre, Wildlife Victoria and Landcare. At the local level, we supported grass-roots and volunteer organisations with donations of more than $840,000 to help run important activities in their communities.

The RACV Community Foundation continued to make a significant contribution to the social fabric of Victoria. The Foundation made its largest ever grant allocation of $591,000 to support 42 mobility projects delivered by Victorian charitable and community organisations.

RACV Energy Breakthrough celebrated its 25th anniversary with record participation and visitation to Maryborough, the home of the event. We also supported an extensive program of motoring and cycling events and activities. The RACV Australia Day picnic was again popular with more than 80,000 participants. We were overwhelmed by the number of members who volunteered to transport more than 90 medically-restricted veterans and nurses as part the annual ANZAC Day Parade in Melbourne.


$6.3m invested into Victorian

communities


DIRECTORS’ REPORTThe Directors of Royal Automobile Club of Victoria (RACV) Limited (the parent entity) present their report together with the financial report of the consolidated entity (the Group), being the parent entity and its subsidiaries, for the year ended 30 June 2016.


Directors The following persons were Directors of RACV during the whole of the financial year and up to the date of this report:

Mr G J Chipp Ms P M KellyMr G O Cosgriff Ms M H KelsallMr A Downie Mr J M S SlatteryMs J K Green Mr K W White (Chairman)Ms N M Griffin Mr G D WillisMr B C Hartnett

Mr C L Jordan was a Director from the beginning of the financial year until his resignation on 1 March 2016 (appointed as Managing Director and Chief Executive Officer on 25 July, 2001).

Mr N Taylor was appointed as Managing Director and Chief Executive Officer on 1 March 2016 and continues in office at the date of this report.

The qualifications, experience, special responsibilities and other details of the Directors in office at the date of this report are set out on pages 14 to15.

The number of RACV board and committee meetings held during the financial year, and each RACV’s Director’s attendance at those meetings, are set out on page 16.

Principal activities, objectives and strategies The principal activities of the Group during the financial year were roadside assistance, social club and resort operations, financial services, travel and tourism, advocacy, home services and the provision and distribution of general insurance.

RACV’s objectives are to deliver valued benefits to its members and their communities by informing and advising them, representing members’ interests and providing them with assistance when in need by delivering excellent products and services in our fields of motoring, mobility, leisure, assurance, financial services, social wellbeing and the home.

Strategies used by the Group to deliver its objectives are defined in RACV’s Corporate Plan, which is available online at www.racv.com.au.

Further details on how the Group’s activities assist in achieving the entity’s strategic priorities and objectives can be found in the President and Chairman’s Report and Managing Director and Chief Executive Officer’s review, found on pages 2 and 4 respectively of the Annual Report.

Review of results and operationsInformation about the Group’s financial position and financial results is included in the consolidated Financial Statements section of the Annual Report.

A review of the Group’s operations and results can be found on pages 2 to 10 of the Annual Report. The review assesses membership, assistance products and services, roadside assistance, insurance, advocacy, travel, leisure and community activities.

DividendsIn compliance with the Memorandum and Articles of Association of RACV Limited, no dividend was declared nor paid during the financial year.

Subsequent eventsIn the opinion of the Directors, there are no other matters or circumstances which have arisen between 30 June 2016 and the date of this report that have significantly affected or may significantly affect the operations of the Group, the results of those operations and the state of affairs of the Group in subsequent financial years.

Environmental regulation and performanceThe Group has in place procedures to identify and comply with particular and significant environmental regulations.

Except as set out below, the operations of the Group are not subject to any particular and significant environmental regulation under a law of the Commonwealth of Australia or any of its states or territories and has not incurred any significant liabilities under any environmental legislation.

The National Greenhouse and Energy Reporting Act 2007 makes registration and reporting mandatory for corporations whose energy production, energy use, or greenhouse gas emissions trigger the specified corporate or facility threshold. RACV has reached the corporate threshold defined within this legislation and is required to submit its annual report by 31 October 2016.


CHAIRMAN NON-EXECUTIVEKevin W White 1 BEng (Civil), MEngSci, MAdminExperienceIndependent Non-Executive Director appointed in March 1994. Currently Executive Chairman of Easton Investments Limited, a financial services company listed on the Australian Stock Exchange. Formerly a non-executive director and Deputy Chairman of Insurance Manufacturers of Australia Pty Ltd and formerly Managing Director of WHK Group Limited and a non-executive director of IOOF Holdings Ltd.Special responsibilitiesPresident and Chairman

DEPUTY CHAIRMAN NON-EXECUTIVENetta M Griffin 2 BA, FAICD, Dip. CDExperienceIndependent Non-Executive Director appointed in July 1998. Career in management and was previously General Manager Customer Operations with a major utility. Was a member of La Trobe University Council for 13 years, having served as Chair of Corporate Governance, Audit and Risk Management.Special responsibilitiesDeputy ChairmanChairman of the Appointments and Remuneration Committee

EXECUTIVE DIRECTORNeil Taylor 3 BA (Geog)ExperienceManaging Director and Chief Executive Officer of RACV Limited and its associated entities. Formerly Chief Executive Officer of Greyhound Australia. Over 25 years’ experience in the corporate sector, both in Australia and overseas. Has completed courses at both Wharton and Harvard Business Schools in the United States of America.Special responsibilitiesManaging Director and Chief Executive Officer (appointed 1 March 2016)

Colin L Jordan (not pictured)BE, BComm, FIE Australia, FIPAAV, FAICD, FAIMExperienceFormer Managing Director and Chief Executive Officer of RACV Limited and its associated entities.Special responsibilitiesManaging Director and Chief Executive Officer (until 1 March 2016)

NON-EXECUTIVE DIRECTORSGraeme J Chipp 4 B.Bus (Acc), MBA (avec mention), GAICD, FAMIExperienceIndependent Non-Executive Director appointed in June 2008. Co-founder and Managing Director of management consultants, Growth Solutions Group Pty Ltd, a trustee of the Robert Rose Foundation and has over 30 years’ experience in the corporate sector including senior roles with ANZ and McKinsey and Company.Special responsibilitiesChairman of the Membership and Community Committee

Geoffrey O Cosgriff 5 BAppSc (Elec), FAICD, FIE Australia, Dip.CD, WCLPExperienceIndependent Non-Executive Director appointed in November 2012. Extensive business experience as an executive manager and director in information technology, transport and infrastructure companies. Currently Chairman of Leadership Victoria, formerly Chairman of UXC Ltd (until February 2016) and a former director of Logica Australia and Transurban. Actively engaged in coaching and mentoring executive managers and directors of companies in a diverse range of industry sectors. Appointed non-executive director of Intelematics Australia Pty Limited in April 2013 and is currently Chairman of Club Tasmania Holdings Pty Ltd.Special responsibilitiesChairman of the Club and Resorts Committee

BOARD OF DIRECTORS

1 2 3 4 5 6


The Board currently comprises 11 Non-Executive Directors and one Executive Director who is appointed as Managing Director/Chief Executive Officer. Non-Executive Directors are elected by members in accordance with Article 33 of the Memorandum and Articles of Association of RACV Limited.

Alexander Downie 6 BA, MAICDExperienceIndependent Non-Executive Director appointed in November 2004. Consultant to legal and commercial firms and has 30 years’ experience with Telecom, Australia Post and the former Postmaster General’s Department. Awarded the Australian Sports Medal in 2000.

Julie K Green 7 FCA, FAICD, WCLPExperienceIndependent Non-Executive Director appointed in November 2013. Director of Loddon Mallee Waste & Resource Recovery Group, Maldon Hospital and Chairman of The Innovation Cooperative. Formerly director of Shepparton Villages, a large regional aged care provider. A business consultant in strategy, governance and change management. Formerly mentor to Board of Windarring Disability, Chief Executive Officer of Early Childhood service provider, and participants of programs for Leadership Victoria. Executive career in infrastructure, transport, utilities and healthcare in the public and private sectors.

Bruce C Hartnett AM 8 B Eng, M EngSci, M Phil, MA, MAICD, FIPAAExperienceIndependent Non-Executive Director appointed in July 2008. Chair of Odyssey House (Victoria), Chair of VicSuper, and President of the Rural Learning and Leadership School. He has been in senior management roles in the Victorian Government, ICI, the National Australia Bank, the ACTU and the non-government sector.

Patricia M Kelly 9 ExperienceIndependent Non-Executive Director appointed in June 2010. Over 35 years’ experience in the Financial Services industry. Former Executive General Manager Strategy and Business Development Personal Insurance at Suncorp/AAMI and previously director and executive of Norwich Union Life Australia. Past President and Honorary Life Member of the Insurance Institute of Victoria and former director of the Australian and New Zealand Institute of Insurance and Finance. Currently an independent non-executive director of Ansvar Ltd and Legal Practitioners Liability Committee.

Merran H Kelsall 10 BCom (Hons), FCA, FCPA, MBA, FAICDExperienceIndependent Non-Executive Director appointed in June 2008. Former partner of BDO Chartered Accountants. Currently Chairman, Auditing and Assurance Standards Board and Australian Health Service Alliance Ltd, Member International Auditing & Assurance Standards Board and a director of VicSuper. Former director of Superpartners Pty Ltd.Special responsibilitiesChairman of the Audit and Compliance Committee

John M S Slattery 11 B.Comm, LLB(Hons)ExperienceIndependent Non-Executive Director appointed in June 2011. Holds a Bachelor of Commerce and a Bachelor of Laws with Honours from the University of Melbourne. Former corporate law partner in the national legal firm of Corrs Chambers Westgarth for 27 years and former partner in charge of the Melbourne office, Chairman of the International Division of Corrs, and member of the Corrs national executive between 1999 and 2009. Appointed non-executive director of Intelematics Australia Pty Limited in April 2012.

Graeme Willis 12 SF Fin, FAICD, FCIBSExperienceIndependent Non-Executive Director appointed in April 2012. Completed a Management Development program at the Harvard Business School. A Senior Fellow of the Financial Services Institute of Australasia, Fellow of the Australian Institute of Company Directors and The Chartered Institute of Bankers (Scotland). A career of over 40 years in banking and finance and held many senior Board and executive management positions with major European and Australian banks. Currently Managing Partner at HSW Capital Pty Ltd, and an independent non-executive director of Victorian Teachers Mutual Bank Ltd.Special responsibilitiesChairman of the Governance and Risk Management Committee

9 10 117 8 12


DIRECTORS’ REPORTCONTINUED

NON-EXECUTIVE DIRECTOR REMUNERATIONThe maximum annual aggregate Directors’ fee pool limit is $2,000,000 which was approved by members at the Annual General Meeting on 12 November 2013 in accordance with Article 38(a) of RACV Limited’s Articles of Association. The total amount of fees paid to Non-Executive Directors during the financial year was $1,499,199 (2015: $1,769,447).

RACV Board and Committee meetings

Director Board Meetings

Audit and Compliance Committee1

Governance and Risk

Management Committee2

Club and Resorts

Committee

Membership and Community

Committee

Appointments and

Remuneration Committee

A B A B A B A B A B A BMr G J Chipp 8 8 1 1 2 2 – – 3 3 – 3Mr G O Cosgriff 8 8 – – – – 4 4 – – 6 6Mr A Downie 8 8 2 2 – 1 – 1 3 3 – –Ms J K Green 7 7 2 1 2 2 – – 2 2 – –Ms N M Griffin 8 8 – – 2 2 4 4 3 2 6 6Mr B C Hartnett 6 6 – – – 1 4 3 3 3 3 3Mr C L Jordan 5 5 – 2 2 2 2 2 1 1 – 1Ms P M Kelly 7 7 3 2 – – 3 3 – – – –Ms M H Kelsall 8 7 3 3 4 3 – – – – 6 5Mr J M S Slattery 8 8 – 1 4 4 4 4 – – – –Mr N Taylor 3 3 – 1 – 2 – 1 – 2 – 1Mr K W White 8 8 3 3 4 4 4 4 3 3 6 6Mr G D Willis 8 7 3 3 4 4 – – – – 6 6

A = Number of meetings eligible to attend B = Number of meetings attended

The current Managing Director and Chief Executive Officer attends all Committee meetings by invitation.

In addition to the above, Directors also serve on subsidiary and associate company Boards as nominee Directors. The RACV Community Foundation reports to the Membership and Community Committee with four meetings held during the year.

1 The Audit and Risk Management Committee was renamed the Audit and Compliance Committee on 26 August 2015. 2 The Governance Committee was renamed the Governance and Risk Management Committee on 26 August 2015.


Company SecretaryMr R Sanzin FCPA, FGIA, BBus(Acc), Grad.Dip.AppCorpGov was appointed to the position of Company Secretary in 2007. Mr Sanzin has had 37 years commercial experience and has responsibility for all Company and Board secretarial duties.

Mr R C Tweddle, AGIA, BA, LLB, Grad.Dip.AppCorpGov was appointed to the position of alternate Company Secretary in 2005. Mr Tweddle has practised as a solicitor for 25 years.

Mr P C Rich, AGIA, B.Comm, Grad.Dip.AppCorpGov was appointed to the position of alternate Company Secretary in 2010.

Indemnification and insurance of Directors and officersTo the extent permitted by law, the parent entity has indemnified each Director, secretary and officer against liability arising from their role as Directors and officers by paying premiums on an insurance contract. This insurance contract prohibits disclosure of the premium paid. No liabilities have arisen under these indemnities as at the date of this report.

Auditor’s independence declarationThe Auditor’s independence declaration is set out on this page and forms part of the Directors’ report for the year ended 30 June 2016.

RoundingThe Group is a company of a kind referred to in the Australian Securities and Investments Commission Class Order 98/100 dated 10 July 1998. Amounts in this Directors’ report and the consolidated Financial Statements, unless otherwise indicated, have been rounded to the nearest hundred thousand dollars in accordance with that Class Order.

This Directors’ report is signed in accordance with a resolution of the Board of Directors.

N M Griffin N TaylorDirector Managing Director and Chief

Executive Officer

Melbourne, 31 August 2016

AUDITOR’S INDEPENDENCE DECLARATIONAs lead auditor for the audit of Royal Automobile Club of Victoria (RACV) Limited for the year ended 30 June 2016, I declare that to the best of my knowledge and belief, there have been:

(a) no contraventions of the auditor independence requirements of the Corporations Act 2001 in relation to the audit; and

(b) no contraventions of any applicable code of professional conduct in relation to the audit.

This declaration is in respect of Royal Automobile Club of Victoria (RACV) Limited and the entities it controlled during the period.

J F PowerPartner PricewaterhouseCoopers

Melbourne, 31 August 2016

ANNUAL REWARDING REPORT MEMBER LOYALTY€¦ · The number of RACV Home and Content Insurance...

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