Response and Implementation Plan Update on Outcomes

Response and Implementation Plan: 2019 Update on OutcomesIndependentPerformanceReview2018

RESPONSEANDIMPLEMENTATIONPLAN–INDEPENDENTPERFORMANCEREVIEW2018

TheHortInnovationReviewofPerformance(theReview)wascompletedinJune2018byGHDConsultingandisavaluablecomponentofcontinuousimprovementfortheCompany.TheReviewisarequirementmandatedundertheCompany’sFundingAgreementwiththeAustralianGovernmentasaResearchandDevelopmentCorporation(RDC).

Atthetime,theChairmanofHortInnovation,MrSelwynSnell,commentedthat“gettingthebalancerightbetweentheinterestsofindividualsandthebettermentoftheAustralianhorticulturesectorasawholeisanongoingconversationandHortInnovationisparticularlyproudoftheimprovementsithasmadesinceitsinceptionin2014,andthattheprocessofcontinuousimprovementnowformspartoftheorganisation’sDNA”.

Twelvemonthson,HortInnovationispleasedtoreportonceagainontheprogressithasmadetowardsimplementingtherecommendationsthatarosefromtheReview.Thatprogressisdetailedinthisupdate.

WithanewStrategicPlan,anupdatedAnnualOperatingPlan,aneworganisationalstructureandthesupportoftheCommonwealthGovernment,HortInnovationiswellplacedtocontinuetoservetheHorticultureindustryandtobuildmeaningfulpartnershipsandabright,sustainableandsecurefutureforAustralianhorticulture.

TheBoard,andindeedeverystaffmemberofHortInnovation,looksforwardtocontinuingtoworkwithindustrytosupportitthroughitsnextphaseofgrowth.

SelwynSnell

Chairman

Recommendation1:HortInnovationtoconsolidateontheimprovementsachievedduringthetransitionphase(first18-24monthsofthecompany)withfurtherrefinementandcontinuousimprovementbasedonthelessonslearnedfromstakeholderfeedbackandinternalcompanyassessments,withemphasisontheimplementationofarefinedcommunicationandengagementplanandtheroleofIRBstomaximisetheeffectivenessofitscommunicationactivities.

StrategicAlignment:CommunicateandListen.

HortInnovationOutcomes:• Inearly2019,acomprehensivestrategyconsultationprocesswascompletedwith22stakeholdereventsheldaroundthecountryandattended

bygrowers,industrybodyrepresentatives,deliverypartnersandotherinterestedthirdparties,alongwithopportunitiesforonlineinputtothenewStrategy2019-23.

• ContinuousimprovementprogramsareconsistentwithfeedbackbeingsuppliedthroughStrategicIndustryAdvisoryPanel(SIAP)meetingsandindustrystakeholders.

• SignificantimprovementsinprocesseswerebroughtaboutbyanewRelationshipManagementoperationalteamandSIAPimprovementtaskforce.Additionally,theHortInnovationBoardhasmetwithandcontinuestomeetwithindustryrepresentativebodies.

• InDecember2018,HortInnovationlaunchedanewwebsitetoprovideeasieraccesstoconsolidatedindustryinformationandupdatesalongwitharefinedsearchfunctionforaccesstoprojectfinalreports,factsheetsandotherinformation.ThewebsitecontinuestoberefinedaswemoveintoournewStrategicPlan2019-23.

• Aneworganisationalstructure,engagementwithgrowersandotherstakeholderswillbeenhancedthroughtheintroductionofaregionalextension&adoptionpresenceandthroughprioritisedface-to-faceengagementwhereverpossible.

Response ImplementationPlanActions Milestones/Measurement

HortInnovationagreeswiththisRecommendation.

ThisisabroadlystatedRecommendation,withaclearfocusoncontinuousimprovementofcommunicationsandengagementwithstakeholders,includingpartneringwithIndustryRepresentativeBodies(IRBs)tomaximisereachtoindustryparticipants.

• ContinuousimprovementofHortInnovation’sstakeholdercommunicationsandengagementwillincludethefollowingactivities:

• Increasinglyactiveengagementwithlevypayinggrowershareholders.

• Effectiveengagementwithanetworkoflevypayinggrowershareholdersthroughrelationshipmanagement.

• ImplementationofaStakeholderManagementPlanwhichdrawstogethercurrentrelationshipmanagement,communications,

Withaviewtoimprovingcommunicationandengagement,initiativescommencedbyHortInnovationinthepasttwoyearsinclude:

• Increasedengagementwithlevypayinggrowershareholders.

• SIAP(StrategicInvestmentAdvisoryPanel)ImprovementProcess.

• ReviewingindustrybodyrepresentationonSIAPs• LaunchofadedicatedHortFrontierswebsiteto

enhancestakeholderunderstandingoflonger-termcross-industryinvestmentstrategies.

• IntroductionofmeetingsbetweentheHortInnovationBoardandIRBBoards.

• StakeholderEngagementplanningandcommunicationsplanning.

Ø ContinuedrefinementofSIAPprocessesandreporting,focusedupon:

Ø Improvedtimelinessandqualityofpapersandminutesbasedonfeedback.

Ø Improvedinformationandprocessforadviceoninvestments.

Ø Improvednarrativeonfinancialpositionoffundsandfutureimpacts.

Ø ImprovedanalysisandfeedbackonstatusofprogramandprogressasagainstindustryStrategicInvestmentPlans(SIPs).

• ImprovedplanningandtimingofadvicebetweenSIAPandHortInnovation.

• ImprovedgovernanceofSIAPproceedingsincludingcodeofconduct,roles,andstandardoperatingprocedures.

• ContinuedengagementbetweentheHortInnovationBoard,IRBBoardsandallrelevantstakeholderstodevelopapartnershipapproachtoindustry.

• DevelopmentofandproposaltoIRBsofHortInnovation/IRBjointinitiativesforcommunicationsto

anddiversityandinclusionplans,activitiesandinitiatives.

• FeedbackfromSIAPchairsandmembers(followingeverymeetingandthroughinternalperformancereviewsurveys).

• StakeholderSentimentSurvey(biennial)–improvementonbaseline.

• EstablishmentofaformalframeworkforengagementwithIRBsthroughaStatementofIntent(thefirstimplementedinQ3FY2019)–whichresultsinmoretwo-waycommunication(referalsotoMilestonesaddressingRecommendation7)

industry(referalsotoActionsaddressingRecommendation7–StatementofIntent).

• Throughnewwebsite:Ø Moresegmenteduser

experienceandaccessforgrowersandotherstakeholders.

Ø Target2-clickmaximumjourneytofindinformation.

Ø Betterdocumentaccessviawebsite,includingfinalprojectreports.

Ø InclusionofaGovernancepage(referalsotoActionsaddressingRecommendation2).

Ø Increaseamountofusefulcontent.

Ø Bettersearchcapability.

Recommendation2:HortInnovationtocontinuetofosterbothformalandinformalcommunicationchannelswiththeCommonwealthintheinterestsofensuringthecompany’sStatutoryFundingAgreement(SFA)obligationsaredischargedinatimelyandeffectivemanner,andbettercommunicateitsSFAobligationstostakeholders.StrategicAlignment:CommunicateandListen.HortInnovationOutcomes:

• HortInnovationcompletedasuccessfulReviewofPerformanceauditandextendedtheexistingFundingAgreementtoDecember2019byformalDeedofVariationwiththeAustralianGovernment.

• FortnightlyteleconferenceswiththeHorticulture,WorkforceandEducationDivisionoftheDepartmentofAgricultureareacontinuingpractice,alongwithsixmonthlyformalcheck-inswithDepartmentofAgricultureleadershiptodiscussperformanceundertheFundingAgreement.

• Animproveduser-friendlyHortInnovationwebsitewaslaunchedinDecember2018offeringadedicatedGovernancepagewithaconciseexplanationofHortInnovation’skeyobligationsundertheFundingAgreement.

• EmailcommunicationsoutliningtheoutcomesfromtheHortInnovationAnnualGeneralMeeting(AGM),includingtheresultsofmembervotingonConstitutionchangesandtheelectionofdirectors,wasissuedtomembers,followedbyPeakIndustryBodiesontheafternoonofthe2018AGMofHortInnovation.HortInnovationalsopreparedamediareleasethatwascirculatedtojournalistsandpostedasanarticleontheHortInnovationwebsite.InformationregardingHortInnovation’sobligationsintheFundingAgreementwasalsoincludedintheAnnualReport2017/18senttoallmembersinOctober2018.


HortInnovationagreeswiththisRecommendation.ThisRecommendationisintwoparts:1. CommunicationsbetweenHortInnovationandthe

Commonwealth

2. CommunicationtostakeholdersinlinewithHortInnovation’sobligationstotheCommonwealthunderitsFundingAgreement.

• HortInnovationengagementwith

theCommonwealthwillcontinuetoincludebothformalandinformalmechanisms,assetoutintheleft-handcolumn.

• InordertobettercommunicateHortInnovation’sobligationsunderitsFundingAgreementwiththeCommonwealth,aspartofthedevelopmentandimplementation

• SuccessfulReviewofPerformance

andestablishmentofnewFundingAgreementto2022.

• DeliveryofrelevantFundingAgreementresponsibilitiestostakeholdersaftertheestablishmentofthenewFundingAgreement,followingeachAGM,announcinganychangespassedbymembersandaspartofthenew

HortInnovation’smandatedresponsibilitiesunderitsFundingAgreementrelatetoR&D,MarketingandTradeactivities.Atdifferenttimes,manystakeholdersrequestandsuggestthatHortInnovationplaysakeyroleinagreaterbreadthofissuesaffectingthehorticulturesector.Focusontheorganisation’smandatedresponsibilitieswill,however,deliverthegreatestbenefittobothindustryandgovernment.

1. CommunicationswiththeCommonwealth

Overthepasttwoyears,HortInnovationhasincorporatedregularengagementwiththeCommonwealth(principallythroughtheDepartmentofAgricultureandWaterResources(DAWR)asakeyactivitytoensurethetimelyknowledgeofandresponsetomattersinthebestinterestsofAustralianhorticultureindustries.Theseactivitiesareinadditiontothemandatorysix-monthlymeetingsrequiredundertheFundingAgreement,andhavecontributedtotheestablishmentofanenduring,openandproductiveworkingrelationshipwiththeCommonwealth.Activitiestodatehaveincluded:

• Fortnightlyscheduledtelephoneconferencestodiscussmattersofmutualinterest.

• Directtelephonecommunicationonanad-hocbasisbetweenseniorDAWRpersonnelandHortInnovationGeneralManagersonanas-neededbasis.

• RegularengagementbytheChairandCEOatMinisteriallevel.

• InvolvementofappropriateDAWRpersonnelinmeetingstodiscusskeyareassuchastrade,biosecurityandfoodsafety.

• InclusionofDAWRandMinisterialrepresentativesin

ofanimproveduser-friendlyHortInnovationwebsite(referalsotoActionsaddressingRecommendations1and6)adedicatedGovernancepageincludes,amongotheritems,aconciseplain-EnglishexplanationofkeyobligationsofHortInnovationundertheFundingAgreement.Additionally,stakeholderswillbenotifiedofanymaterialchangestotheHortInnovationConstitutionorFundingAgreementinatimelymanner.

• HortInnovationwillcontinuetocommunicateitsFundingAgreementobligationstostakeholdersincludingthroughBoardmeetingswithIRBBoards,managementmeetingswithIRBrepresentatives,discussionsatSIAPs,andday-to-dayengagementwithindividualgrowersandstakeholders.

Governancesectiononwebsite.• Aspartoftheimplementationofa

StakeholderManagementPlan,HortInnovationwillcommunicatetherelevantFundingAgreementobligationsthroughmultiplechannelsaspartofthebroaderconversationwithindustry(referalsotoMilestonesaddressingRecommendation1).

industryactivitiesandevents• ProjectcollaborationwithDAWR,forexamplethe

proposedcentralLevyPayerRegister.2. CommunicationswithstakeholdersregardingtheFunding

AgreementTodate,HortInnovationhasengagedinlimitedcommunicationwithstakeholdersthatarededicatedtotheunderstandingofHortInnovation’sobligations.TheAnnualReportandNoticeofAnnualGeneralMeetinghavebeentheprimarydocumentsincludingthisinformation.

Recommendation3:HortInnovationtoimproveitsreportsto:• EnsureconsistencyinthepresentationofinformationonfinancialforecastinginAnnualOperatingPlan(AOP’s)andsubsequentfinancialreports

inAnnualReports.• ProvidemoreinformationonthesourceoffundsforFrontierFundsandtherationalefortheselectionofFrontierFundprojects.

StrategicAlignment:CommunicateandListen.HortInnovationOutcomes:InthewakeofthecompletionoftheHortFrontiersStrategyConsultationPaperinearlyAugust2018,thefollowingcommunicationactivitiesoccurredasapartofthedevelopmentoftheStrategicInvestmentPlans(SIPs)foreachoftheexistingsevenstrategicinvestmentfunds:1.DevelopmentandcommunicationofdetailedSIPstosupportcurrentStrategicIntentdocumentsforFrontiersinvestments.2.MoredetailedreportingprovidedthroughtheHortFrontiersandnewcorporatewebsites.3.PotentialforspecificHortFrontierseventsorparticipationinindustryeventsonrequest.4.UpdateonFrontiersfundsattheAGM.5.OngoingupdatestoSIAPsonactiveFrontiersprojectsrelevanttospecificindustries.ExpertAdvisoryPanel(EAP)workshopshavebeenconvenedforGreenCities,Pollination,AsianMarketsandAdvancedProductionSystemsHortFrontierstodate.TheseworkshopshaveprovidedfeedbackonthethemeswithintheFundsandtheirappropriateness.ForStrategicLevyFunds,alsorefertoSIAPimprovementsprogresssetoutforRecommendation1.


HortInnovationagreeswiththisRecommendation,withanadjustmentinwordingtoreflectactualoperations.ThisRecommendationisintwoparts:1. Presentationoffinancialforecastinformation.

2. CommunicationoffundingandrationaleforFrontier

Funds.

1. Presentationoffinancialforecast

information

HortInnovationwillreviewitsapproachtoreportingtoensurestakeholdersareabletomorefullyreconciletheforecastsprovidedtoindustryatthecommencementofaperiodwiththeresultsreportedattheendofthatperiod.

• Reviewofreportingoffinancial

dataduringplanningforeachAnnualOperatingPlan(AOP)andAnnualReport,incorporatingfeedbackandlessonslearned.

• FeedbackfromSIAPsonimproved

informationregardingHortFrontiersinvestments.

1. PresentationoffinancialforecastinformationHortInnovationadaptsitsfinancialforecastreportingtosuitthepurposeandaudienceofthedocumentcontainingtheinformation.Thiscanleadtoadifferentpresentationoffinancialinformationbetweendocuments,observedintheIndependentPerformanceReviewReport.AnnualOperationalPlans(AOPs)areprincipallyinternaloperatingdocuments,andundertheFundingAgreementarerequiredtobeprovidedtotheCommonwealth.TheinformationinthesePlansisbasedonmanagementreportingneeds.Conversely,thepurposeoftheHortInnovationAnnualReportistocommunicateactivitiesandresultstostakeholdersforagivenfinancialyear.ThefinancialreportingintheAnnualReportconformstostatutoryreportingrequirements.2. CommunicationoffundingandrationaleforFrontier

FundsEnhancedFrontierFundcommunicationsareunderwayincluding:

• ThelaunchofadedicatedHortFrontierswebsitetoenhancestakeholderunderstandingoflonger-term,cross-industryinvestmentstrategies.

• IssueofaStrategyConsultationPaperinJuly2018,forstakeholderstosharetheirthoughtsonHortFrontiersinvestmentprioritiesandthemes.

• InclusionofdiscussionsregardingpotentialFrontierFundinvestmentsatallSIAPmeetings.

• ImprovedfinancialinformationforSIAPstounderstandfundsinvestedinHortFrontiers(alsorefer

2. CommunicationoffundingandrationaleforFrontierFunds

FollowingcompletionofstakeholderconsultationontheHortFrontiersStrategyConsultationPaperinearlyAugust2018,thefollowingcommunicationactivitieswilloccurasapartofthedevelopmentoftheStrategicInvestmentPlans(SIPs)foreachoftheexistingsevenstrategicinvestmentfunds:

• DevelopmentandcommunicationofdetailedSIPstosupportcurrentStrategicIntentdocumentsforFrontiersinvestments.

• MoredetailedreportingprovidedthroughboththeHortFrontiersandnewcorporatewebsites.

• PotentialforspecificHortFrontiersevents,orparticipationinindustryeventsonrequest.

• UpdateonFrontiersFundsattheAGM.

• OngoingupdatestoSIAPsonactiveFrontiersprojectsrelevanttospecificindustries.

• StakeholderSentimentSurvey(biennial)–feedbackonFrontierFunds(improvementonbaseline).

• Delivery,publishingand

communicationofFrontierFundSIPstomembersandontheHortInnovationwebsite.

toActionsaddressingRecommendation1–SIAPImprovements).

• DataandreportingprojecttoprovidebetterdataforreportingsourcefundsforFrontiers.

Recommendation4:HortInnovationtocompletethedevelopmentofanintegratedfinancialandmanagementaccountingsystemthatwillprovidemoretimelyandaccuratereportstoguideinvestments.

StrategicAlignment:DeliveronInvestments.

HortInnovationOutcomes:• ImprovementstoFundreportingthroughdataandreportingproject.• Improvedinformationtofunctionsthroughthedataenvisioningprojects.• ThefirstdashboardsforR&DwerereleasedinJanuary2019.• Aconsolidatedapproachhasbeenachievedwithadigitalplatformthroughwebsiteconsolidation.Thatapproachhasbeenachievedthrough

ongoingpositivefeedbackfromSIAPsonqualityandclarityoffinancialinformation.• Endofyearfinancialsforthebusinessandtheindustrieswereproducedforannualreportsinthe2018FinancialYear.Therehavebeenongoing

discussionsonfinancialsaroundCorporateCostRecoverywithhalf-yearlyfinancials.


HortInnovationagreeswiththisRecommendation,withanadjustmentinwordingtoreflectactualoperations.

TheRecommendationsuggeststhatthefinancialandmanagementaccountingsystemsbeintegrated,howeverthepracticalapplicationofthisRecommendationwillseetheintegrationoffinancialandmanagementreporting.FollowingthetransitiontoaprocurementmodelunderHortInnovationfromagrantsmodel(underHorticultureAustraliaLimited(HAL)),theorganisationalsomovedfroman

• HortInnovationwillcontinueitsongoingdataqualityandreportingimprovementprocessesassetoutintheleft-handcolumn.Anintegratedaccountingandmanagementreportingsolutionforlevyfundshasbeenpartiallydevelopedandisinthetestingphase.Thishasbeenthe

• DeliveryofafundforecastingandreportingtoolforR&D(Q2FY19),andMarketingandFrontiersFunds(Q3FY19)

• FeedbackfromSIAPsonimprovedfinancialreportingandforecastinformation

investmentcycleheavilyweightedtowardstheendoftheyeartoan‘openallyear’investmentcycle.Thischangedramaticallyincreasedtheamountofinvestmentearlierintheyearandincreasedtheneedfor‘forecast’informationratherthantraditionallyrelyingonmorehistoricalinformation,whichhasalwaysbeenaccurateandunchanging.Forecastdataontheotherhandis,byitsnature,constantlychangingduetomultiplefactorsincluding:

• Variationstoexistingprojects.• Timingofinvestments,milestonesandexpenses

relatingtosomeprojects.• Seasonalandothervariationsinlevyincomeand

GrossValueofProductionforecastsforAustraliangovernmentco-investment.

• Costrecovery,capsonco-investmentandotherbusinessrules.

Inthecurrentoperatingmodel,thearticulationoffinancialreportingasdistinctfromforwardlookingforecastingorestimationisacriticaldifference.Continuedeffortsarerequiredtoclearlycommunicatethis.HortInnovationhasbeenengagedinongoingdataqualityandreportingimprovementsparticularlyoverthepast18months,includingthecontinuousreviewofhistoricalprojects,milestonesanddata.

culminationofmorethan12months’effort.

• Thedevelopmentoftheforecastingandreportingtoolisacomplexcombinationofinputs,businessrulesandcalculationsandisstillexposedtothemanyvariablesdescribedontheleft.Thetoolwillallowformoreaccurateandtimelyinformationtobeprovidedinfuturebyautomatingthecomplexcalculationsrequiredandupdatingthevariablesmoreefficiently.

• HortInnovationwillcontinuetorefinethecommunicationtoindustry(includingthroughSIAPsandday-to-dayengagement)onthefinancialsystemsandprocesses,includingtheroleandlimitationsofforecasting.Indoingso,HortInnovationaimstoclearlyexplainthedifferencebetweenfinancialreportingonincomeandexpenditure,andforecastingorestimatingintothefuture,toestablishasharedunderstandingwithindustryandSIAPs.

Recommendation5:HortInnovationtocompleteareviewofthecurrentorganisationalandinternalreportingandapprovalsmodeltodetermineifitisthemosteffectiveandefficientstructurefordeliveringitscorporateactivities,includingresponsivenesstolevypayerrequests,whilebeingcognisantof

anycostimplications.

StrategicAlignment:DeliveronInvestments;CommunicateandListen.

HortInnovationOutcomes–Anewcorporatestructurewasimplementedin2019.Highlightsofthenewstructureinclude:

• IntroductionofanewExtension&Adoptionfunction,whichwillbebuiltoutfurtherin2020,tohelpdriveknowledge,innovationandinvestmentoutcomesintoindustries.

Thesplittingoftheformer‘Research,Marketing&Investments’functionintotwoseparatefunctions:Research&DevelopmentandMarketing&Trade.Alignmentofmanyrolestoa‘clusterbased’approachinlate2019,withstaffinthreekeyteams(marketing,tradeandHortInnovation’srelationshipmanagementstaff,nowknownasstrategicpartners)lookingafterlikeindustriesformaximumopportunitiesforidentifyingandactinguponsharedopportunitiesandchallenges.TheclustersincludetheTropicalCluster,TemperateCluster,VegetableClusterandGreen/Nut/BerryCluster.StaffengagementisalsocontinualthroughregularExecutiveTeamcommunications.



HortInnovationwelcomedanewChiefExecutiveOfficerinSeptember2018whichpresentedanidealopportunityforreviewofthecurrentoperationalstructureofthecompanyandhowthesecanbeoptimised.Further,2019wasthefinalyearofthepreviouscorporateStrategicPlan.Theprocessofsettingafreshstrategyin2019contributedtodecisionmaking.ConsiderationofefficienciesinoperationshasbeenanongoingprocessthroughthetransitionfromHALtoHortInnovation.HortInnovationhasrespondedtochangingneedsovertime,including:

• Conductofanorganisationaldesignprojecttoformulatethecurrentstructure.

• Highperformanceteamtraining/performance

ThenewCEOofHortInnovationisassessingthemosteffectiveandefficientstructurefordeliveryofcorporateactivitiesandinvestments,aspartofhisoversightofthecompanyfromSeptember2018.ThenewCEOisundertakingthereviewinthe2019financialyear.Inthemeantime,HortInnovationisproceedingwithitscontinuousimprovementapproach,setoutintheleft-handcolumn.EachtimeHortInnovationrecruitsnewandreplacementtalent,Executivemanagementreviewstherolesandresponsibilitiesofeachrole.Thisleadstogradualefficienciesandimprovementsin

• StakeholderSentimentSurvey(biennial)(improvementonbaseline).

• Staffengagementsurvey.• Onlinefeedbackmechanism.• HortInnovationCEOtohave

undertakenandimplementedanorganisationalreviewbytheendofFY2019.

managementandcoachingtoincreaseproductivityofstructurethroughindividualsandteams.

• Increasingcapacityinstrategicareastoimproveserviceandresponsiveness.

• Reviewingproductivitythroughtimeandmotionstudiestoidentifyefficiencies.

• Implementingsystemstoimprovequalityandreducere-work.

• AdjustingthestructureofsomefunctionsgraduallytooptimisestructureincludingrolesinFinance,Procurement,IT,DataandInsights,R&DandCommunications.

Thesecontinuousimprovementshavebeenundertakenwhilebeingmindfulthatincreasingservicealsoincreasesthecostofthedeliverymodel,especiallyregardingface-to-facecommunicationandfeedbackmechanisms.HortInnovationhasalsosoughttoenhanceresponsivenesstolevypayerrequeststhrough:

• Anonlinefeedbackmechanism.• StakeholderSentimentSurveys.• SIAPimprovementsprocess.

theoperationalstructureovertime.

Recommendation6:HortInnovationto:• CompleteitsDiversity&InclusionPolicyincludingmeasurableobjectivesforachievinggenderdiversity.• Includenon-financialDelegationsofAuthoritymattersfortheBoardinapolicydocument.• AddaGovernancesectiontoitswebsitetherebydisclosingitsnon-confidentialgoodgovernanceframeworks,documentsandpractices.

StrategicAlignment:CultureandLeadership;CommunicateandListen.HortInnovationOutcomes

• OngoingimplementationoftheDiversityandInclusionStrategy2019-2021continues.• DelegationsofAuthorityareinplaceandapprovedbytheBoard.• NewHortInnovationwebsitelaunchedinDecember2018.


HortInnovationagreeswiththisRecommendation.Inprincipleandinpractice,HortInnovationiscommittedtoahighstandardofgovernancewithanapproachofcontinuousimprovement.Effectivegovernanceiscriticaltothedeliveryofprojectsandactivitiesforthebenefitofgrowers.ThemeasuressetoutinthisRecommendationtouchuponthreeverydifferentareasofeffectivecorporategovernance:

1. Highperformanceculture,aslinkedtomeasurableachievementofdiversity(andinclusion).

2. FormaldocumentationofallDelegationsofAuthority,forclarity.

3. Transparencyofgovernanceframeworksforthebenefitofstakeholders.

1. Highperformanceculture,aslinkedtomeasurable

achievementofdiversity(andinclusion)HortInnovation’scommitmenttodiversityandinclusionwasinitiallydocumentedin2015asakeyProgramofWorkunder

1. DiversityandInclusionPolicy

HortInnovation’scommitmenttodiversityandinclusionisnotlimitedtogenderdiversity.HortInnovationwillcompleteconceptualisationanddocumentationofitsDiversity&InclusionPolicy,includingmeasurableobjectives,andcommenceformalimplementationofthePolicyoverthecomingmonths.TheaimofsuchaPolicyistopromoteahighperformancecultureanddocumentthiscommitment.2. Formaldocumentationofall

DelegationsofAuthorityAnon-financialdelegationsdocumentwillbedraftedforapprovalbytheHortInnovationBoardinthecomingmonths.

• Implementation,review,

maintenanceandcommunicationofDiversityandInclusionPolicyinFY2019.

• Documentationofallnon-financialBoarddelegationsinQ2FY2019.

• DeliveryofimprovedHortInnovationwebsite.

itsHRStrategy.WhileaDiversityandInclusionPolicyisintheprocessofdocumentation,practicesinsupportofdiversityandinclusionhavebeenanimportantpartofoperationsoverthepastyears,including:

• ProvidingDiversityandInclusiontrainingtostaff,managementandtheBoard.

• ParticipationinaglobalDiversityandInclusionsurvey(throughtheDiversityCouncilofAustralia)anddiscussionofresultswithstaff,managementandBoard.

• Communicationofthecompany’scommitmenttoDiversityandInclusionthroughavarietyofwrittenandverbalmeans.

• Talentacquisitionandtalentmanagementpoliciesandpractices(inplace)beingbuiltupontopromotediversityandacultureofinclusion.

• Buildinginclusiveleadershipcapabilityasacorecompetency.

2. FormaldocumentationofallDelegationsofAuthority,for

clarity

HortInnovationhasacomprehensiveDelegationsofAuthorityinvestmentsinplace,settingoutfinanciallimitsofinvestmentapprovalsallocatedtomanagementandtheBoardrespectively.Further,HortInnovation’sBoardCharterandCharteroftheCommitteesoftheBoardcurrentlysetoutthebroadrolesanddelegationsofthesegoverningbodies.Itisacknowledgedthat,forclarity,amoregranularDelegationsdocumentfornon-financialauthoritieswould

3. Additionofa‘Governance’pagetothe

HortInnovationpublicwebsiteAspartofthedevelopmentandimplementationofanimproveduser-friendlyHortInnovationwebsite(referalsotoActionsaddressingRecommendations1,2and6)adedicatedGovernancepagewascreatedandpopulatedwiththenon-confidentialgovernanceframeworks,documentsandpracticesemployedbyHortInnovation.

assistinthecommunicationandgovernanceoftherolesreservedforBoardconsiderationandapproval.

3. Transparencyofgovernanceframeworksforthebenefit

ofstakeholdersHortInnovationagreesthatitcanbetterdemonstrateitsgovernanceprocessestostakeholdersbyprovidingreadyaccesstonon-confidentialgovernancedocumentationonitspublicwebsite.

Recommendation 7: Hort Innovation to develop a generic agreement, or Statement of Intent, between Hort Innovation and IRBs that codifies therelationshipandincludesacomplaintshandlingprocess,withthescopeoftheagreementtobejointlyagreedbetweenHortInnovationandIRBs.StrategicAlignment:CultureandLeadership;CommunicateandListen;DeliveronInvestments.HortInnovationOutcomes:AsuitableformofStatementofIntent(‘StatementofCommitmenttoMutualPurposeandRespect’)wasfinalisedandapprovedbytheExecutiveandtheBoard.MeetingswereconductedinFebruaryandMarch2019betweenHortInnovation,CEOMattBrandandGMStakeholderEngagementSallyHolmestodiscusstheStatementofCommitmentwithanumberofIndustryRepresentativeBodies(IRB’s).The first Statement of Commitment was signed with Avocados Australia Limited on April 1, 2019 and since that time Hort Innovation has signedStatementsofCommitmentwithAlmondBoardofAustralia,AustralianMacadamiaSocietyandAustralianBananaGrowersCouncil.TheStatementofCommitmenthasbeenofferedtoallIRBsanddiscussionscontinue,withtheaimtoenterintofurtheragreementsinthenearfuture.


HortInnovationagreeswiththisRecommendation,withanadjustmenttoaccommodatea‘fit-for-purpose’approach.HortInnovationacknowledgesthevalueofdevelopingandmaintainingconstructivepartnershipswithIRBs,withtheaimofworkingtogethertowardasharedpurposeandvisionforindustry.ThetransitionfromHorticultureAustraliaLimited(HAL)toHortInnovationgreatlyimpactedontheserelationships,andmuchworkhasbeendoneoverthepastfewyearstomovetowardanewwayofworkingtogetherwithIRB’s.Thesemeasuresinclude:

• Continuousconsultation,engagementandfeedbackatalllevels(operations,managementandBoard).

• IncreasedrepresentationofIRBsonSIAPs.• Consultationthroughthedevelopmentofindustry

StrategicInvestmentPlans(SIPs).• Supportforindustryeventsandconferencesincluding

HortInnovationcommitstocontinuediscussionswithIRB’stoworkbettertogetherforthebenefitoflevypayersandthewiderhorticultureindustry.HortInnovation’sinitialconsiderationofmattersthatmaybeaddressedinaStatementofIntentincludethefollowing:

• RespectiverolesandresponsibilitiesofHortInnovationandtheIRB’s.

• Mechanismsforcommunication,co-operationandpartnershipinsupportofindustry.

• Commitmenttoconstructivecollaborationintheinterestsofbetterprogramoutcomesforindustry.

• ExecutionofthefirstStatements

ofIntentwithIRBsinthethirdquarterofthe2019FinancialYear.

sponsorshipandparticipationasspeakersandexhibitors.

HortInnovationrecognisesthatthereisarangeofcapabilityandexpertiseamongIRBsinthehorticultureindustry.ThediversityinsizeandresourcesamongtheIRB’srequiresthata‘fitforpurpose’approachbetakeninthepracticalapplicationofthisRecommendation.HortInnovationagreeswiththeintention,expressedintheReport,thatcodificationofrelationshipwithIRBsfulfilsapurposequiteseparatetotheentryintodeliverypartnercontractsfordeliveryofsubstantiveR&DandMarketingprograms(followingprocurement).Inthisway,nopaymentshouldbeattachedtotheStatementofIntent.

• AgreedcomplaintshandlingmethodologyforIRB’sandHortInnovationtoraiseissueswiththeother.

• AgreedstandardsofbehaviourindealingswithbetweenIRB’sandHortInnovation.

Ratherthanasingle‘generic’StatementofIntent,considerationofthedifferenceincapabilityasbetweenIRB’sinhorticulturemayresultinthedevelopmentofatleasttwodifferentversionsofaStatementofIntent,recognisingthesedifferencesindefiningrespectiverolesofHortInnovationandIRB’sinoperatingforthebenefitofindustry.HortInnovationwillconductaplannedconsultationwithIRB’sindevelopmentofproposedStatementofIntentcontent.

Recommendation8:HortInnovation,inconsultationwithIRBsandtheCommonwealth,toputaresolutionformembervoteremovingtheexclusionofIRBsfrombeingmembersofthecompany.

StrategicAlignment:CultureandLeadership;CommunicateandListen.

HortInnovationOutcomes:SpecialResolutiontopermitIRBnon-votingmembershipnotpassedatAGM2018,byanarrowmargin.CompletedNov2018.



TheConstitutionofHortInnovationwasputinplacefollowingtheoutcomesoftheACILAllenReviewofHorticultureAustraliaLimited(HAL)conductedin2014.ThereisnodoubtthatthefindingsoftheACILAllenReviewregardingconflictofinterestinHALownershipandoperationsledtoapositionwheretheConstitutionofHortInnovationwasdesignedtorepresentadefinitivebreakfromtheoldstructure,inmovingtoagrower-ownedRDC.AsobservedintheReviewReport,theexclusionofIRBsfrommembershipofHortInnovationhas,indifferentiatingIRBsfromthegreaterhorticultureindustry,inhibitedtherelationshipasbetweenHortInnovationandIRBs.Inpractice,HortInnovationhaseachyearinvitedtheChairsandExecutiveOfficersofIRBstoattenditsAGMandhavewelcomedtheserepresentativesandtheopportunityforengagementontheseoccasions.PermittingIRBstobemembersofHortInnovationwouldresultintheautomaticissueofamemberinvitationtotheAGMandtheopportunityforeachIRBtoaskquestionsintheformalmeetingproceedings,throughtheirdelegatedrepresentative.

• HortInnovationcommitstoconsultwithIRBsandwiththeCommonwealth,throughDAWR,todeterminewhetherIRBsandDAWRsupporttheputtingofamembervoteremovingtheConstitutionalexclusionofIRBsfrombeingmembersofthecompany.

• ShouldsufficientsupportfromIRBs,andthesupportofDAWR,beachievedHortInnovationwillputaresolutiontoVotingMemberstopermitIRBstobecomemembersofthecompany.

• ItisimportanttonotethataresolutionputtoVotingMembersforConstitutionalchangewillrequire75percentofVotingMemberstovoteinfavouroftheresolutionforthechangetobeachieved.Further,IRB

• ConductofconsultationwithIRBsandDAWRpriortoOctober2018,topermitaresolutiontobeputtothe2018AGMifsupported

• StakeholderSentimentSurvey(biennial)-improvementonbaseline.

membershipwillnotconveyuponIRBs’votingentitlements,whicharereservedforlevypayers.

Recommendation9:HortInnovationtobettercommunicatetheimprovementsthatarebeingprogressedtoaddressissuesidentifiedaspotentiallynegativelyimpactingonitsperformance,including:

• ProgressionoftheSIAPimprovementprocess.• FrontiersFunds,especiallythebenefitsofattractingco-investorsforcross-industryoutcomeswithminimaluseoflevyfunds.• Considerationofahybridmodelforprojectinitiation.• Tomoreefficientlydeliverservicesandreducetheriskofasiloedapproach,considerhowtoimprovethecollaborationbetweensmaller

industries.• Activitiesinsupportoffoodsafetyinitiativesandcrisismanagement.

StrategicAlignment:CommunicateandListen.HortInnovationOutcomes:

• AdedicatedGovernancepagehasbeenincludedinthestructureofthenewwebsite.• QuarterlyupdatesonimplementationofcontinuousimprovementmeasuresontheHortInnovationwebsitecompleted.• Membercommunicationscontinuestoberegular(GrowingInnovationnewsletter),aswellastime-specificupdates(AGMresults,yearlywrap-

up).• SignificantengagementwithstakeholderswasachievedthroughtheStrategyConsultationprocess–viaworkshopsaswellaskeygrower

dinners.• HortInnovationalsoworksthroughindustrycommunicationsmanagerstoplacerelevantandtimelyupdatesthroughindustryspecificchannels

managersbythirdparties(often,IRB’s).Response ImplementationPlan

Actions Milestones/MeasurementHortInnovationagreeswiththisRecommendation,aslistedactivitiesarewithinHortInnovation’smandateunderitsConstitutionandFundingAgreement.HortInnovationhastraditionallyoperatedwithaviewthat,whilestakeholdersareinterestedinthecommunicationofresultsachieved,thereislittleinterestinreceiptofcommunicationsregardingtheoperationalmethodsandmeasuresofthecompany,noritsprogramsforcontinuous

Toenhancereportingonprogressofoperationalimprovementsaddressingissuespotentiallynegativelyimpactingonitsperformance,HortInnovationwill:

• IncorporatecontinuousimprovementreportingaspartoftheGovernancepageofitsimprovedwebsite(referalsoto

• Quarterlyupdatesonthe

implementationofcontinuousimprovementmeasuresontheHortInnovationwebsitebeganinQ2ofthe2019FinancialYear.

• FeedbackfromSIAPchairsandmembers(followingeverymeetingandthroughinternalperformance

improvement.ThisRecommendation,however,supportsproactivecommunicationofoperationalinitiativesonanongoingbasis,andHortInnovationishappytoprovidestakeholderswithmoreinformation.Activitiestodateregardingcommunicationofthosematterslistedinclude:

1. SIAPimprovementprocessThisisanexampleofwhereincreasedcommunicationshavealreadybegun.OngoingimprovementsareregularlycommunicatedtoSIAPmembers(alsorefertoResponseaddressingRecommendation1)andSIAPChairsmeetbiannuallytodiscussimprovementsandprovidefeedback.

2. FrontierFundsImprovementsincommunicationregardingFrontierFundshaverecentlyincludedlaunchofapurpose-builtwebsite,andissueofaConsultationPaperseekingfurtherstakeholderinputintothedevelopmentoffullStrategicInvestmentPlansforeachFrontierFund(referalsotoResponseandActionsaddressingRecommendations1and3).

3. Hybridmodel(callandconcept)Atraditionalcall-onlyprocessprovideslittleornoopportunitytoseekvalue-for-moneythroughacompetitiveprocess.InitstransitionfromHAL,HortInnovationmovedawayfromagrantsprocess(callfor)infavourofaninnovationandprocurementprocess(submitideas).HortInnovationis

ActionsaddressingRecommendation1).

• Seekopportunitiestoincorporaterelevantupdatesinregularformal(forexampleAnnualReport)andinformalstakeholdercommunications,asappropriate.

reviewsurveys).• StakeholderSentimentSurvey

(biennial)–improvementonbaseline.

consideringpotentialenhancementstothisprocessthroughimplementationofa‘callfor’processforconceptstogetmoretargetedsubmissionsaroundspecificareasofinterest,forexampleinareasidentifiedbyindustryStrategicInvestmentPlan(SIP)gapanalyses.Thisprocesswillalsoallowfortranchesofconceptstobeconsideredandefficientlymovedthroughtheprocesstogether.

4. CollaborationbetweensmallerindustriesInthedeliveryofFrontierFundinvestmentopportunities,marketinginitiatives,tradeinitiativesanddiscussionsregardingbiosecurity,HortInnovationproactivelyengagesindustrieswithsimilarinterestsandstrategicimperativestoformmulti-industryprojects,Further,theFundManagerandIndustryStrategicPartner(formerlyRelationshipManagers)operatingstructureprovideseffectiveongoingoversightofindustry‘clusters’toidentifyopportunitiesforcollaboration.

5. FoodsafetyandcrisismanagementHortinnovationhaslimitedscopetoactintheseareas,otherthanthroughinvestmentinR&Dtocontributetotheeffectivemanagementoffoodsafetyandothercrisisincidents.Despitetheselimitations,HortInnovationseekstoquicklyrespondandidentifypotentialforassistancewhensuchissuesarise.Anexampleofthisproactiveapproachwasinvestmentinmeasuresfollowingthemelonlisteriaoutbreak.

Recommendation10:HortInnovationtocontinuetoseekcross-RDCcollaborationopportunitiesthatwillbenefithorticultureaswellasthebroaderagriculturalindustriesandcommunity.StrategicAlignment:DelivertheInvestments;CultureandLeadership.HortInnovationOutcomes:Workonthisrecommendationiscontinuing.HortInnovationhasseencontinuedparticipationinallRDCconvenedmeetingsthroughbusinessmanagers,communications,technology,theM&EUnit.AspecificexampleincludesthePlantBiosecurityResearchInitiative(PBRI),whichincorporatessevenRDCs,andisledbyHortInnovation.Thisisprovingsuccessful.Furtherreportsoncollaborationwereincludedin2018/19AnnualReport.


HortInnovationagreeswiththisRecommendation.HortInnovationvaluesitscollaborativerelationshipswithotherRDCs,andcurrentlyparticipatesinanumberofformalandinformalactivitiesforthispurposeincluding:

• ActiveparticipationinworkinggroupsconvenedthroughtheCouncilofRuralRDCs,includingtheCEOs’andChairs’meetings,theBusinessManagersGroup,theEvaluationWorkingGroup,theCommunicationManagersGroup,andtheITManagersGroup.

• Interactivesessionsinreviewanddevelopmentofthecentrallevypayerregister,withDAWRandotherRDCs.

• ProactiveengagementinallRuralR&DforProfitfundingroundsofferedbytheAustralianGovernment,resultingintheawardofalargeamountofadditionalfundingforindustry.

TheAnnualReportsetsoutanumberofformalcollaborations

HortInnovationwillcontinuetoseekopportunitiestocollaboratewithotherRDCsonacontinuousbasis.ThenewHortInnovationCEOhasalongstandingcross-sectoralviewofandinvolvementinagriculture,anditisexpectedwillbeinapositiontopositivelycontributetocollaborativeefforts(alsorefertoActionsaddressingRecommendation11).

• Participationincross-RDC

meetingsandinitiativesinvolvingHortInnovationstafffromavarietyofbusinessunits.

• Non-levyfundingobtainedincollaborationwithotherRDC’sforinvestmentinprojectsforthebenefitofindustry.

involvingHortInnovation.TheseactivitiescontributevaluetoAustralianhorticultureindustriesby:

• Maximisingtheamountofnon-levyfundsinvestedinprogramsforthebenefitoflevypayers.

• Leveraginglevyfundsforachievementofgreateroutcomesforindustry.

• Dataandknowledgesharing,creatingoperationalefficiencies.

Recommendation11:HortInnovationtofinaliseitsapproachtotransitionthemonitoringandevaluationfocusfromex-anteimpactassessmenttoex-posteimpactassessmentstotestifexpectedbenefitshavebeendeliveredandinformfutureinvestmentdecisions.StrategicAlignment:DeliveronInvestments.HortInnovationOutcomes:During2018/19,HortInnovationengagedindependentconsultantstoevaluatetheimpactofourR&Dinvestmentsinthepreviousfinancialyear,providinginsightsintothetypeandmagnitudeofimpactsgeneratedacrossthecompany’sstrategiclevyprograms.Theevaluationrevealedarangeofeconomic,socialandenvironmentalbenefitsbeinggeneratedforhorticulturegrowers,supplychainparticipants,andthecommunityatlarge.Theresultsdemonstratedthatacrossthe15sampledprojects,anaveragebenefit-costratioofthreetoonewasachieved,generatingatotalnetpresentvalueof$41.8millionover30years.


HortInnovationagreeswiththisRecommendation.HortInnovation’sData&Insightsteamwasformedin2015todevelopandmaintainanappropriatemonitoringandevaluationframeworkbestsuitedtoHortInnovation’sstrategicinvestmentoperations(asdistinctfromthoseofitspredecessorcompanyHAL),andincompliancewithitsnewFundingAgreementwiththeAustralianGovernment.HortInnovation’sOrganisationalEvaluationFrameworkwasfinalisedandpublishedinDecember2016andcontinuestobeimplemented.Activitiesinimplementationsince2016include:

• Developmentofindependentex-anteimpactassessmentsfor30newindustryStrategicInvestmentPlans(SIPs).

Asinvestmentsreachanappropriatestageofmaturity,HortInnovationwillbeimplementingfurtherex-posteimpactassessments.Identificationofprojects/programsforex-posteanalysisisdoneinpartnershipwithindustrythroughSIAPs.Thecostofex-posteimpactassessmentscanbesignificant;thereforeitisimportantthattheaimsandbenefitsbeclearbeforeproceeding.Industry’scapacitytopayisrelevantintheseconsiderations,particularlyinindustrieswithlimitedlevyfundstoexecutetheirstrategicpriorities.Further,HortInnovationisactively

• Completionoffurtherex-poste

impactassessmentsacrossseveralprojects/programsyearonyear.

• Whileafirmnumberofex-posteassessmentsischallengingtoestimate,identificationofpriorityprojects/programsforassessmentwilltakeariskmanagementapproach,asreferredtoinActionsaddressingRecommendation12.

• Developmentofindependentex-anteimpactassessmentsforsixFrontierFunds.

• Executionofex-posteimpactassessmentofvegetableR&Dinvestmentsofapproximately$66Moverthefive-yearperiodfrom2012to2017.

Havingestablishedaneffectiveex-antebaselineforassessmentofinvestmentimpacts,HortInnovationisnowturningattentiontoex-posteimpactassessments.

participating,alongsideotherRDCs,intheprocessofupdatingtheCouncilofRuralRDC’sImpactAssessmentGuidelinesandImpactAssessmentProgramManagementProcedures.TheapproachtoassessmenttakenbyHortInnovationwillneedtoalignwiththeseguidelinesandprocedures(referalsotoActionsaddressingRecommendation12).

Recommendation12:HortInnovationtoensurethatriskisaconsiderationinallocatingresourcesandestablishingtriggersformonitoringandevaluation,notingthatatthemomenttheframeworkcurrentlylinksthedeterminationofmonitoringandevaluationmethodstosizeofproject,availabilityofdataandM&Ecapability.ThisislikelytobeofparticularimportancetoFrontierFundinvestments.StrategicAlignment:DeliveronInvestments.HortInnovationOutcomes:Inrespecttolargerstrategiclevyfunds,astructuredapproachtoex-postimpactassessmentisbeingimplemented.Duringquarterthreeandquarterfourofthe2018financialyear,HortInnovationintroducedanewinvestmentriskmanagementframework,withfurtherimplementationtobeconductedinthe2019-2020financialyear.


HortInnovationagreeswiththisRecommendation.TheRecommendationobservesthat,todate,HortInnovationhasprincipallyreferredtoinvestmentvalueasaproxymeasureforriskinherentininvestments,whenprioritisingprojectsforcomprehensivemonitoringandevaluationmethodologies.HortInnovationrecognisesthatinvestmentriskisbroaderthanfinancialcommitmentandactivelyimplementswiderriskanalysiscriteriainitsbusinesscasesandinvestmentapprovalsprocesses.Thesewidercriteriawillbeextendedtotheprocessofallocatinganappropriateprojectmonitoringandevaluationapproach,asrelevant.

HortInnovationiscurrentlyengagedintheimplementationofanInvestmentRiskManagementenhancementprocessthroughoutthewholeoftheinvestmentprocessfromconcepttocontracting.PartofthisprojectwilllinkriskassessmentsundertakenbyHortInnovationateachstageoftheinvestmentprocesstotheselectionofappropriatemonitoringandevaluationactivityatvariouspointsthroughouttheinvestmentlifecycle.Oncedefined,thesemeasureswillbereflectedinHortInnovation’supdatedOrganisationalEvaluationFramework.

• Completionofthereviewof

InvestmentRiskManagementinFY2019,andcorrespondingupdatetotheOrganisationalEvaluationFramework.

Recommendation13:HortInnovationtoamendSection6oftheOrganisationalEvaluationFrameworktoincreasethefrequencyofreportingtogrowersand levypayers,and investorsandco-investors fromjustend-of-investmentcyclereporting.ThisupdatetotheFrameworkwillalsobetterreflectHortInnovation’scurrentpractice,whichistoprovidemoreregularupdatestothesestakeholders.

StrategicAlignment:CommunicateandListen.

HortInnovationOutcomes:CompletedinFebruary2019.



Theneedformorereportingontheend-to-endinvestmentcycleisacknowledgedbyHortInnovationandiscurrentlybeingaddressed,asnotedintheReviewReport.

HortInnovationwillupdateSection6ofitsOrganisationalEvaluationFramework,currentlytitledIndicativereportingarrangements,toprovideamorecomprehensiveandaccuraterepresentationoftheincreasedlevelofreportingtoallstakeholdersofevaluationprocess,progressandresults.

• CompletedupdateofSection6oftheOrganisationalEvaluationFrameworkinQ2FY2019.

Recommendation14:ThatHortInnovationreviewsmarketingarrangementstodetermineifprojectscanbedeliveredinamoreefficientandeffectivemanner,attherequestofIRBswhoserviceindustrieswithmarketinglevies.StrategicAlignment:DeliveronInvestments;CommunicateandListen.HortInnovationOutcomes:

• DiscussionswithApplesandPearsAustraliahaveresultedintheimplementationofaStrategicMarketing(Advisory)Panelfortheappleandpearindustry,includingexpertiseinfastmovingconsumergoodsmarketing.TheMacadamiaMarketingProgramwasawardedtotheAustralianMacadamiaSocietyfollowingacompetitivetenderandthereareongoingdiscussionswithseveralindustries(includingAvocado,Macadamia,NurseryandApple/Pear)aboutstructuresandbetterwaysofworking.

• AnewGeneralManagerformarketingandtradehasbeenappointed.


HortInnovationagreeswiththisRecommendation.HortInnovationstronglysupportstheachievementofefficienciesindeliveryofitsinvestmentprogramsonbehalfofAustralianhorticultureindustries.Duetothesmallsizeofanumberofindustrymarketinglevies,andthehighcostofwide-reachingandeffectivemarketingactivities,HortInnovationhasidentifiednumerousopportunitiesforcross-industryalignmentandinvestmenttoincreasetheimpactofmarketinglevyspend.Alignmentisparticularlysuitableforproductsinsimilarorcomplementarycategories.Itisimportanttonote,assetoutintheReviewReport,thattheHorticultureMarketingandResearchandDevelopmentServicesAct2000doesnotpermitHortInnovationtodelegateoroutsourceresponsibilityfortheinvestmentoflevyfundstothirdparties.HortInnovationbelievesthereareopportunities

HortInnovationwillcontinuetoachieveefficienciesintheapplicationoflevyfundsbyworkingwithmarketinglevy-payingindustriestoofferopportunitiestodevelopanddeliverthebestpossiblemarketingoutcome,throughcross-industrycollaborationandotherpotentialmeans.Thiswillbeachievedbylookingforopportunities,withintheconstraintsofHortInnovation’sobligationsunderitsConstitutionandFundingAgreement,toimprovethedeliveryofmarketinginitiativesandcommunicatingtheseopportunitiestoindustry.Inadditiontothoseproactivemeasures,HortInnovationwilllistentoandwork

• StakeholderSentimentSurvey

(biennial)–improvementonbaseline.

toachieveefficienciesformanyindustrieswhilecomplyingwiththisstatutoryrequirement.WhiletheRecommendationreferstoinstanceswhereanIRBrequestsareviewofmarketingarrangements,HortInnovationseekstoproactivelyidentifyopportunitiesforgreaterefficienciesintheuseofmarketingfundsaspartoffulfillingitsobligationsascustodianoflevypayerfunds(formarketingandalsoR&D).Further,the2017StakeholderSentimentSurveyacknowledgesbroadindustryappreciationforthearrangementscurrentlyinplace.

withmarketinglevy-payingindustrieswhopresentproposalsformoreefficientandeffectivemarketingprograms.

AnyenquiriesregardingHortInnovation’sIndependentPerformanceReview2018orHortInnovation’saboveresponse/implementationplan/outcomes updateshouldbedirectedto:

Mr Matthew Waring

CompanySecretary

HorticultureInnovationAustraliaLimited

Email:[email protected]

Documents

Response and Implementation Plan Update on Outcomes