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2  AGL will continue to support employees seeking flexible work arrangements as well as the specific needs of our employees who are carers. By June 2013, AGL will implement new programs to support employees who are parents. 

## Progress to date 

AGL is currently piloting a program to support women who have recently returned to the workplace after maternity leave and/or who are balancing work with young children. AGL is also working on initiatives to support employees and their leaders during the key phases of parental leave, including the transition back to work and the first 12 to 18 months back in the workplace. AGL continues to encourage its leaders and employees to embrace flexible working arrangements. 

3  AGL will continue to implement initiatives to increase the number of women in leadership positions. AGL will increase the representation of women in its top 300 positions (top 15% of positions) to 38% by 30 June 2015. 

## Progress to date 

Currently women occupy 32% of the top 300 positions at AGL (excluding AGL Loy Yang). By setting a target for the top 15% of roles, AGL is aiming to increase the representation of women in a group that includes all of AGL’s critical business roles and roles that are on the pathway to executive leadership. AGL’s businesses have taken up a share of the three year target with an emphasis on businesses where the representation of women is less than 40%, including the operational businesses of Merchant Energy and Upstream Gas. 

## Recommendation 3.4 – Companies should disclose the proportion of women employees in the company, in senior executive positions, and on the Board 

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## Principle 4: Safeguard integrity in financial reporting 

## Recommendation 4.1 – The Board should establish an audit committee 

The Board has established an Audit and Risk Management Committee. Its primary function is to assist the Board in fulfilling its responsibilities to provide shareholders with timely and reliable financial reports and to protect the interests of shareholders, customers, employees and the broader community through the effective identification, assessment, monitoring and management of risks. 

## Recommendation 4.2 – The audit committee should be appropriately structured 

Under its Charter, the Audit and Risk Management Committee must have at least three members, all of whom must be independent non-executive Directors. The Charter also requires that all members have a working familiarity with basic accounting and finance practices and that at least one member have financial expertise. The Committee must also include members with an understanding of the industry in which AGL operates. 

The composition of the Committee has changed during the financial year, with Sandra McPhee appointed to the Committee in March. The Committee currently comprises five members – John Stanhope (Chair), Bruce Phillips, Les Hosking, Belinda Hutchinson and Sandra McPhee. John Stanhope has financial expertise as a qualified accountant. Bruce Phillips and Les Hosking have each enjoyed long careers in the energy industry. Belinda Hutchinson also has prior energy industry experience as a former director of Energy Australia and Snowy Hydro Trading. She also has extensive experience in finance and risk management. Sandra McPhee has been an AGL Director since 2006. She has extensive experience in consumer oriented industries, so is familiar with the risks that affect a customer facing business. 

Further details of the qualifications and experience of all Committee members are disclosed on pages 42 and 43 of this Annual Report. 

The CEO, CFO, Company Secretary (who also has responsibility for AGL’s Group Risk and Compliance function), Head of Group Audit and the external auditor attend Committee meetings at the discretion of the Committee. Other non-executive Directors may attend meetings. 

The Committee meets privately with the external auditor on general matters concerning the external audit and other related matters, including the half-year and full-year financial reports. The Committee also meets privately with the Head of Group Audit. 

The Company Secretary is the secretary to the Committee. Copies of the minutes of a meeting of the Committee are distributed to the Board for discussion at the next full Board meeting. The Chairman of the Committee reports to the Board on the Committee’s conclusions and recommendations. 

The Committee collectively, and its members individually, have access to internal and external resources, including access to advice from external consultants or specialists. 

The Committee met five times during the year. Directors’ attendances are set out on page 44 of this Annual Report. 

## Recommendation 4.3 – The audit committee should have a formal charter 

The Committee operates under a formal Charter published on AGL’s website. The Charter is required to be reviewed by the Committee and updated at least every two years. The Charter was most recently reviewed and updated in April 2012. 

The Charter sets out the roles and responsibilities, composition, structure and membership requirements of the Committee. 

The Committee’s primary responsibilities include: 

> Monitoring the integrity of financial reporting; 

> Monitoring and reviewing the external auditor’s qualifications, performance and independence; 

> Monitoring the effectiveness of risk management processes, including reviewing the adequacy of AGL’s property, business interruption, and liability insurances; 

> Monitoring the effectiveness of Group Audit; 

> Monitoring legislative and regulatory compliance; and 

> Monitoring the adequacy and completeness of internal controls. 

## Monitoring auditor independence 

AGL’s Auditor Independence Policy was reviewed during the year. It contains details of the procedures for the selection and 

