· 2015-2016 CEO KPI Update > Risk Management Implications Undertaking a regular review of the CEO"s performance is an important control mitigating

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Adelaide HillsCOUNCIL

CEO PERFORMANCE REVIEW PANEL

NOTICE OF MEETING

To: Presiding Member Cr Jan-Claire Wisdom

Members

Mayor Bill SpraggCr Jan LovedayCr Ian BaileyMs Paula Davies, Independent Member

Notice is hereby given pursuant to the provisions under Section 87 of the LocalGovernment Act 1999 that the next meeting of the CEO Performance Review Panel will be heldon:

Friday 20 May 20163.30pm

63 Mt Barker Road Stirling

A copy of the Agenda for this meeting is supplied under Section 83 of the Act.

Meetings of the Council and Committees are open to the public and interested members of thecommunity are welcome to attend.

[?Andrew Aitken

Chief Executive Officer

'Ap

AdelgideHillsCOUNCIL

CEO PERFORMANCE REVIEW PANEL

AGENDA FOR MEETING

Friday 20 May 2016

. 3.30pm63 Mt Barker Road Stirling

ORDER OF BUSINESS

Council Vision

Nurturing our unique place and people

Council Mission

Delivering activities and services which build a resilient community, sustain our built and naturalenvironment and promote a vibrant economy

1. COMMENCEMENT

2. APOLOGIES/LEAVE OF ABSENCE

2.1. Apology

2.2. Leave of Absence

2.3. Absent

3. MINUTES OF PREVIOUS MEETINGS

3.1. CEO Performance Review Panel-18 November 2015

Recommendation

That the minutes of the CEO Performance Review Panel meeting held on 18 November2015, OS supplied, be confirmed as an accurate record of the proceedings of that meeting.

CEO Performance Review Panel

AGENDA

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4. DELEGATION OF AUTHORITY

The CEO Performance Review Panel operates in accordance with the relevant sections ofthe Local Government Act 1999, and its Terms of Reference.

s. DECLARATION OF INTEREST BY MEMBERS OF THE COMMITTEE

6. OFFICER REPORTS

6.1. 2015-2016 CEO Key Performance Indicator UpdateThat the report be received and noted.

Process Discussion - CEO Performance Review 2016

That the report be received and noted

That the CEO Performance Review Panel recommends to Council to undertake the 2016CEO Review process using an [internal review process / external consultant?.

CEO Performance Review Panel - Next Meeting DateThat the next CEO Performance Review Panel meeting be held on 21 July 2016, 3.30-5pm.

6.2.

6.3.

7. NEXT MEETING

The next CEO Performance Review Panel meeting will be held on a date to be determinedat 63 Mounl Barker Road, Stirling.

8. CLOSE MEETING

ADELAIDE HILLS COUNCIL CEO PERFORMANCE REVIEW PANEL

Fridag 20 Mag 2016AGENDA BUSINESS ITEM

Item:

Originating Officer:

Subject:

6.1

Andrew Aitken, Chief Executive Officer

2015-2016 CEO Key Performance Indicator Update

SUMMARY

The role of the CEO Performance Review Panel includes reviewing the performance of the CEO, inparticular the performance against the Key Performance Indicators (KPIs) and to undertake a reviewof the CEO"s KPIs to ensure they remain relevant, achievable and aligned to Council"s strategicobjectives.

This report provides an update on activities against the Chief Executive Officer's KPIs.

RECOMMENDATION

That the Panel resolves:

1. That the report be received and noted,

1. GOVERNANCE

> Strategic Management Plan/Council Policy

Goal4 A Recognised Leading Performer

Key Issue 4.1 Leadership

Key Action 4.1.4 Meet Iegislative, regulatory and good governance responsibilities andobligations

> Legal Implications

The CEO Performance Review Panel is a Section 41 Committee of Council under the Local

Government Act 1999.

This report summarises progress against the established and agreed KP?s for 2016, andforms part of the performance review process to ensure the CEO is provided with a fair andconsistent performance review process that would stand up under scrutiny.

Adelaide Hills Council CEO Performance Review Panel 20 May 20162015-2016 CEO KPI Update

> Risk Management Implications

Undertaking a regular review of the CEO"s performance is an important control mitigatingthe risk of:

Deficient CEO performance review practices result in a Iack of accountability and loss ofstakeholder confidence in the organisation.

l Inherent Risk Residual Risk Target Risk

Note: there are many other controls that also assist in managing this risk.

Non-achievement of CEO KPIs result in loss of community benefit and/or opportunitiesand/or stakeholder confidence in the organisation.

i Inherent Risk Residual Risk W malTarget Risk


> Financial and Resource Implications

There are no financial or resource implications in reporting on projects against the CEOKP?'s.

> Customer Service and Community/Cultural Implications

There is a community expectation that the CEO will manage the organisation's human,financial and physical resources to ensure the best outcomes for the community.

There is a community expectation that the CEO is accountable to, and performs against, theagreed KP?s.

> Environmental Implications

Not applicable.

> Community Engagement/Consultation

Not applicable.

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2.

3.

BACKGROUND

As part of the 2015 performance review process, 2016 KP?s were established for the CEOand adopted by Council on 24 November 2015.

ANALYSIS

This item enables an interim analysis of the suite of existing KP?s with a view to reviewingpriorities and existing timeframes of individual KP?s. It also provides opportunity for theCEO to update the CEO Performance Review Panel on the progress against the KPIs to dateand identify any issues for consideration.

Adelaide Hills Council CEO Performance Review Panel 20 May 2016

2015-2016 CEO KPI Update

4. OPTIONS

1.

2.

That the report be received and noted.That the Panel makes alternative/additional recommendations to Council relating tothe current suite of KP?s.

s. APPENDIX

1. CEO KPIs 2016

Appendix 12015-2016 CEO KP?s

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Item:


Subject:


FRIDAY 20 MAY 2016

AGENDA BUSINESS ITEM

6.2

Megan Sutherland, Manager Organisational Development

Process Discussion - CEO Performance Review 2016

SUMMARY

The CEO Performance Review Panel must agree on the process to undertake the review of the CEO'sperformance for 2016.

The Panel may decide on undertaking the performance review internally or using an externalconsultant.

RECOMMENDATION


1. That the report be received and noted

2. That the CEO Performance Review Panel recommends to Council to undertake the 2016 CEO

Review process using an [internal review process / external consultant].

1. GOVERNANCE




Key Action 4.1.4 Meet Iegislative, regulatory and good governance responsibilities andobligations



Government Act 1999 (LG Act).

The regular review of the CEO's performance needs to be undertaken appropriately toensure the CEO is provided with a fair and consistent approach to performance reviews andthat the process would stand up under scrutiny, as the process, review tool and outcomesof the review directly affect decisions made in relation to the CEO, his performance,remuneration and employment contract.

Adelaide Hills Council CEO Performance Review Panel 20 May 2016Process Discussion - CEO Performance Review 2016


Undertaking regular review of the CEO's performance is an important control mitigating therisk of:

Deficient CEO performance review practices result in a lack of accountability and loss ofstakeholder confidence in the organisation.

Inherent Risk Rpsidual Risk

Medium (3C) Medium (3D)

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Target RiskMedium (3D)



gr

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Target Risk

Medium (3D)

r1

Residual Risk

Medium (3D)

Inherent Risk

High (3B) r r



Costs associated with using an external consultant to undertake the CEO Review processare covered within the draft budget.


There is a community expectation that the performance of the CEO is reviewed in a sound,fair and comprehensive manner.


Not applicable.


Not applicable.

2. BACKGROUND

For the past three years, the CEO"s annual performance has been reviewed using anexternal consultant to undertake a comprehensive review process. This has included a "360degree' review tool completed by Council Members, direct reports and managers. Theassessment sought feedback on the completion of the identified KPl"s, key responsibilitiesfrom the position description and personal attributes.

Reports were provided to the CEO, and a one-on-one debrief on those results with theconsultant was held. The report was also provided to the CEO Performance Review Panelfor review and a copy presented to the Council Members. A debrief by the consultantsummarising the report outcomes was provided to both the Panel and Council Members atthe relevant Panel meeting and Council workshop.

The final report and recommendations from the Panel to the Council, including anyincreases to the CEO's Total Employment Cost package, have been the final stage of theprocess.

Adelaide Hills Council CEO Performance Review Panel 20 May 2016Process Discussion - CEO Performance Review 2016

3. ANALYSIS

The processes undertaken over the past three years have been extensive, taking severalmonths to complete. Report findings over these three years have clearly shown the CEO'sconsistently competent performance in the role both as a person and leader, as well asindicating his ability to meet the identified KPl"s. Each year the CEO Review Reports haveshown the CEO has met and at times exceeded expectations.

The survey findings provided in the report take on several facets, providing feedback onperformance in the overall role (meeting position description requirements and personalattributes required to undertake the role), meeting KPI targets and personal developmentopportunities.

It is crucial when reviewing survey results to undertake a balanced consideration of allfindings. It is important to note that feedback comments as part of such surveys that caninform development opportunities do not necessarily reflect the standard of performancein that particular area (improvement identified does not immediately imply less thancompetent performance).

Another aspect to consider in this decision is that the CEO"s s year contract expires on 30September 2017 (the 'Expiry Date'). The Contract provides for a written application by theCEO to the Council for a new employment contract, at Ieast 6 months before the ExpiryDate. The CEO is to be provided written notice at Ieast 4 months prior to the Expiry Datewhether or not a new employment agreement is to be offered to the CEO. Where Councilhas made an offer, the CEO must notify the Council at Ieast 3 months prior to the ExpiryDate whether or not the Council's offer is accepted.

For the coming year, the Panel must decide on whether to use an internal or external CEOPerformance Review process.

An external process would require the engagement of a consultant. It is recommendedthat the schedule to complete this piece of work be significantly tightened from that ofprevious years to complete the process within 4-6 weeks.

If this approach is chosen, it is considered best for the survey to be undertaken on theposition description and KPI only. No additional feedback would be sought from anyrespondents. The report would be discussed through the Panel and the final report andrecommendation taken to Council.

An internal process would require the use of a tool to assess the CEO against the positiondescription and KPI completion only. The tool would be agreed between the CEO andPanel. It is recommended the schedule to complete this piece of work would be 2-3 weeks.If this approach is chosen, it is recommended that two panel members complete the reviewwith the CEO. The report will be discussed through the Panel and the final report andrecommendation taken to Council.

4. OPTIONS

1.

2.

That the Panel agrees to undertake a review using an internal process.That the Panel agrees to undertake a review using an external consultant.


Friday 20 May 2016AGENDA BUSINESS ITEM

Item:


Subject:

6.3

Megan Sutherland, Manager Organisational Development

CEO Performance Review Panel - Next Meeting Date

SUMMARY

The role of the CEO Performance Review Panel includes reviewing the performance of the CEO, inparticular the performance against the Key Performance Indicators (KPIs) and to undertake a reviewof the CEO's KP?s to ensure they remain relevant, achievable and aligned to Council's strategicobjectives.

The agreement of the next meeting date enables required work to be undertaken in preparation forthe next CEO Performance Review Panel meeting.

RECOMMENDATION


1. That the next CEO Performance Review Panel meeting be held on 21 July 2016, 3.30-5pm.

1. GOVERNANCE




Key Action 4.1.4 Meet legislative, regulatory and good governance responsibilities andobligations



Government Act 1999.

This process needs to be undertaken appropriately to ensure the CEO is provided with a fairand consistent approach to performance reviews and that the process would stand upunder scrutiny, as the process, review tool and the outcomes of the review directly affectdecisions made in relation to the CEO, his performance, remuneration and employmentcontract.

Adelaide Hills Council CEO Performance Review Panel 20 May 2016CEO Performance Review Panel - Next Meeting Date


Undertaking a regular review of the CEO"s performance is an important control mitigatingthe risk of:

Deficient CEO performance review practices result in a lack of accountability and loss ofstakeholder confidence in the organisation.

i Inherent Risk Residual Risk 'W l'*' I.

Target Rlsk

Medium (3C) Medium (3D) Medium (3D)



l Inherent Risk Residual Risk rqal.

Target Risk



Nil


There is an expectation that the requirements of the Terms of Reference will be adhered toand the CEO Performance Review Panel will have nominated meetings to prepare for,undertake and report on the process.


Not applicable.


Not applicable.

I1

i1

2. BACKGROUND

Booking the next CEO Performance Review Panel enables the required planning andpreparation to be undertaken by the Administration in preparation for the meeting.

Adelaide Hills Council CEO Performance Review Panel 20 May 2016CEO Performance Review Panel - Next Meeting Date

3. ANALYSIS

It is considered appropriate to set the meeting schedule at the next meeting once adecision has been made on the process to be used to undertake the CEO's PerformanceReview for 2016. As such it is proposed the next meeting is set for 21 July 2016, 3.30-5pm,which would enable the Panel to make required decisions and agree to the schedule ofwork and timeframes for the CEO Performance Review 2016 to be undertaken.

4. OPTIONS

1. That the next CEO Performance Review Panel meeting be held on 21 July 2016, 3.30-5.00pm.

2. That the next CEO Performance Review Panel meeting be held on xx/xx/2016, x.xx-x.xxpm.

Documents

· 2015-2016 CEO KPI Update > Risk Management Implications Undertaking a regular review of the CEO"s performance is an important control mitigating