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Commercial Activities Policy

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Purpose | Scope | Principles | Policy statements | Roles and responsibilities | Definitions | Approval information | Version history | References | Appendix 1: Commercial activities evaluation, approval authorities and management and review responsibilities | Appendix 2: UTS commercial activities reporting protocol | Appendix 3: Activities that are not commercial (UTS core business) 

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1. Purpose

1.1 The Commercial Activities Policy (the policy) fulfils Council’s obligation to establish guidelines for commercial activities under section 21B(1) of the University of Technology Sydney Act 1989 (NSW) (the UTS Act). Specifically, this policy:

  1. further defines commercial activities in line with section 21A of the UTS Act
  2. outlines requirements for evaluating and approving proposals for, and monitoring and reporting on, commercial activities, and
  3. identifies appropriate governance and administrative arrangements for commercial activities, including the requirements for controlled entities.

1.2 This policy is supported by the Commercial Activities Management Procedure (SharePoint) (the procedure) and should be read in conjunction with the Competitive Neutrality and Pricing Policy and the Conflicts of Interest Disclosure Policy, which apply to all commercial activities undertaken by UTS.

1.3 This policy constitutes the guidelines as specified in the UTS Act.

2. Scope

2.1 This policy applies to all:

  1. activities defined as commercial in section 21A of the UTS Act and detailed in Appendix 1 of this policy (including the promotion and establishment of or participation in any partnership, trust, company or other incorporated body, or joint venture, by or on behalf of UTS, for the primary purpose of making a financial profit, either in the short or long term), and
  2. individuals (staff, affiliates and committees) involved in the evaluation, approval and management (review, monitoring and reporting) of these commercial activities.

2.2 The following are managed separately to this policy:

  1. intellectual property at UTS (refer Intellectual Property Policy)
  2. research translation, including research commercialisation (refer Research Policy and Research Intellectual Property and Research Translation Procedure). Appendix 1 outlines authorities.

3. Principles

3.1 Commercial activities at UTS must:

  1. align with UTS’s strategy 
  2. result from thorough due diligence investigations that identify and manage the risks and opportunities consistent with the UTS risk management framework (refer Risk Management Policy) 
  3. provide clear benefits to the university (financial and non-financial) 
  4. not involve the tobacco industry (refer Research Policy) 
  5. be managed prudently, ensuring all funds and resources are allocated and acquitted appropriately 
  6. comply with relevant legislation 
  7. fall into a Council approved classification 
  8. meet relevant reporting requirements to ensure continued accountability and transparency 
  9. comply with the security requirements outlined in the Guidelines to counter foreign interference in the Australian university sector and the requirements of the Fraud and Corruption Prevention Policy and the Conflicts of Interest Disclosure Policy.

3.2 Decision-making on commercial activities must be: 

  1. based on an evaluation of both opportunities and risks, and 
  2. transparent and show clear accountabilities of the sponsors, evaluators, approvers and responsible owners.

3.3 Sponsors, evaluators, approvers and responsible owners (refer Appendix 1) are responsible for mitigating and managing any commercialisation risks and realising any opportunities in line with this policy. A member of the senior executive must be an identified responsible owner for all controlled entities and any commercial activity that is considered higher risk. 

3.4 Where there is ambiguity about the commercial nature of an activity, this must be discussed with the Office of General Counsel for input and escalated to the Chief Operating Officer (COO) for decision in line with this policy and the procedure. 

3.5 Any new activity that may potentially be commercial, but does not fall into one of the classifications identified in statement 4.2, must be referred to the COO for advice. Where relevant, the COO may escalate it to Council for approving a new classification or amendment of an existing classification.

4. Policy statements

Council delegations and university authorities for commercial activities

4.1 Under section 6(3)(a) of the UTS Act, UTS may undertake commercial activities to generate funds for the benefit of the university. In line with section 17 of the UTS Act, Council has delegated responsibilities for the evaluation, approval, management and review/monitoring of some commercial activities (Appendix 1) in accordance with the following.

  1. Council may delegate approval authority for a commercial activity where the proposed commercial activity is covered by the university’s existing insurance policies or where the uninsured liability is within the delegated authority of the approving senior executive or committee. It is expected that a financial provision will be made in the pricing of the commercial activity to provide an element of cover for the uninsured liability. 
  2. Council may limit responsibilities delegated under section 17 of the UTS Act by any means or criteria at any time. 
  3. Delegations in respect of commercial activities may only be exercised where delegates have appropriate commercial experience or have obtained advice from an appropriately qualified person. 
  4. The approval authority of a proposed activity must not also be the sponsor of the activity. In such cases, the new approver should default to the next most senior person or, where appropriate, to Council. 
  5. A Council delegated approval authority also provides authority to execute instruments to give effect to the commercial activity in line with UTS policies and the request for contract signing (available at Office of General Counsel: Request for contract signing (SharePoint)). 
  6. Commercial activities may be ended or discontinued by the relevant approval authority or by Council at any time. 
  7. The appointment of a person to hold a position as a director of a company on behalf of the university is made by Council in line with the Delegations.

Determination and classification of commercial activities

4.2 Commercial activities are defined and classified in Appendix 1 to meet the requirements of the UTS Act. 

4.3 Where Council approves a new classification of commercial activity, this policy and the procedure must be amended to reflect this decision.

Evaluation and approval of a commercial activity proposal

4.4 Sponsors may submit for evaluation any of the following in line with the procedure:

  1. newly proposed commercial activities
  2. activities that are potentially commercial as determined by the COO or Council, or
  3. changes to existing commercial activities.

4.5 All required proposal documentation must be completed and endorsed by both the sponsor and the evaluator before submission to the approval authority (refer the procedure).

Additional requirements for controlled entities

4.6 Council is responsible for the approval of all controlled entities and must adhere to and fulfil the obligations outlined in sections 16(1B) and 16A of the UTS Act, which outline limits on activities and functions and required governance arrangements to safeguard the university’s interests and limit its liability. 

4.7 Council requires each controlled entity to agree to observe the same limits on its activities and functions as apply to the university (outlined in section 16(1B) of the UTS Act). 

4.8 Controlled entities must provide reports to responsible senior executive and/or Council on their activities, functions and governance arrangements in line with this policy and the procedure. 

4.9 As far as is reasonably practical, Council must ensure that the proposal and establishment documents for each controlled entity: 

  1. include appropriate limitation provisions in its constitution 
  2. include a relevant corporate strategy and/or business plan outlining achievable and measurable goals, values and performance targets 
  3. outline appropriate and effective risk management strategies, including independent evaluation, accountability and audit processes, in line with the UTS Act, this policy and the procedure 
  4. has a nominated member of the UTS senior executive named as a responsible owner and that the entity’s directors possess the necessary expertise and experience to provide proper stewardship and control of the entity 
  5. recommend the inclusion of board members who are not Council members, staff or students of the university, and 
  6. outline governance principles, requirements and practices (including reporting requirements in line with Appendix 2) and a mechanism for reviewing these governance arrangements.

Register of commercial activities and controlled entities

4.10 A register of university commercial activities (the register), established by Council in line with section 21C of the UTS Act, is managed and maintained by the Office of General Counsel. Section 21C also outlines the details that must be included in the register for each of the university’s commercial activities. 

4.11 Council may, in accordance with section 21C(2), make alterations or exemptions to the register. Council must keep a record of and include such determinations in the register. 

4.12 Commercialisation of research activities is managed by the Research Office who will provide the Office of General Counsel with relevant details of research commercialisation for inclusion in the register (refer Research Intellectual Property and Research Translation Procedure). 

4.13 In addition to the requirements of section 21C, the register must also contain the following information for each controlled entity: 

  1. the basis on which the controlled entity was established 
  2. the formal status of the entity 
  3. names of the directors or other owners including a short statement of their qualifications and experience 
  4. a summary of the governance arrangements and processes established by the entity for its own commercial activities and details of where further information about the entity, including all reports received from that controlled entity, can be obtained, and 
  5. information on commercial activities owned by UTS controlled entities that is equivalent to the information required by UTS for its own commercial activities. 

4.14 The register must be: 

  1. kept up to date and accessible to Council members under conditions determined by Council and recorded in Council minutes, and 
  2. reviewed every 3 years as outlined in the procedure. 

4.15 Council may authorise the Office of General Counsel to amend or supplement any details included in the register if: 

  1. the details are considered inaccurate or incomplete, or 
  2. an approved change to a commercial activity (in line with this policy and the procedure) requires a subsequent change to the relevant details included in the register.

Commercial activity review and reporting requirements

4.16 Every UTS commercial activity included in the register must be reviewed and risk assessed by the responsible owner at least once a calendar year in line with the procedure, with any changes to the activity’s risk profile or major modification to a commercial activity provided in an exception report to the relevant approval authority (as outlined in Appendix 1). 

4.17 The COO will report to the Audit and Risk Committee annually on all UTS commercial activities in line with the procedure. The Deputy Vice-Chancellor (Research) will report annually to Academic Board via the Research Committee on all research commercialisation (refer Research Intellectual Property and Research Translation Procedure). This does not preclude reference to research commercialisation activities being included in the broader report to the Audit and Risk Committee on research risks. Refer Appendix 2 for annual and triennial reporting requirements. 

4.18 Every 3 years, the COO will present a detailed report on all non-research commercial activities in the register to the Audit and Risk Committee and then to Council for their oversight and input. Every 3 years, the Deputy Vice-Chancellor (Research) will provide a detailed report on all commercial activities in the register to the Research Committee then Academic Board and Council for their oversight and input.

Additional reporting requirements for controlled entities and authorities of Council

4.19 To enable Council to have sufficient oversight, and to fulfil its obligations under the UTS Act and this policy, controlled entities must report on their functions, activities and governance arrangements as outlined in Appendix 2. 

4.20 The senior executive responsible for a controlled entity (the responsible owner) must, among other reporting requirements, provide Council with evidence that their assigned controlled entity continues to meet its responsibilities by reporting on: 

  1. internal assessments and expert (external) evaluations of the nature, efficacy and adequacy of their management and operational systems and processes, and 
  2. the identification of any amendments, additions and improvements to their systems and processes as requested by Council. 

4.21 Council may at any time: 

  1. request reports or other information from a controlled entity 
  2. declare that any particular commercial activity, or class of commercial activities, undertaken by a controlled entity shall be subject to additional processes and systems for assessment and approval, and/or 
  3. request that responsible senior executive work with the controlled entity to review whether any activity proposed to be undertaken by a controlled entity should be subject to processes and systems more closely aligned or consistent with those that are used by the university for its own commercial activities.

Policy breaches

4.22 Breaches of this policy will be dealt with in accordance with the relevant Enterprise agreement, employment contract, the Code of Conduct and/or Council’s resolutions relating to conflicts of interest as appropriate. 

4.23 The COO is responsible for authorising corrective action to rectify all breaches of this policy and must report any activities that may involve serious wrongdoing for management under the Whistleblowing and Public Interest Disclosures Policy.

5. Roles and responsibilities

5.1 Policy owner: The Chief Operating Officer (COO), on behalf of the Vice-Chancellor, is responsible for the enforcement of and compliance with this policy and for the approval of any associated university level procedures.

5.2 Policy contact: The COO is responsible for the implementation of this policy, acting as a primary point of contact and providing advice to the university community about the operation of UTS commercial activities.

5.3 Implementation and governance roles:

The responsibilities of sponsors, approvers, evaluators and responsible owners are listed in Appendix 1. 

Evaluators (refer Appendix 1) are responsible for providing guidance and advice on the relevant commercial activity for which they are responsible. Evaluators and review authorities are approved by the Vice-Chancellor. 

Council and its committees receive reports on commercial activities as outlined in Appendix 2. Council is responsible for the oversight and management of commercial activities and controlled entities as outlined in the UTS Act and this policy. 

The Provost is responsible for engaging the independent person who will conduct the triennial review of the register. 

The Office of General Counsel is the university’s nominated custodian of the register of university commercial activities and is responsible for ensuring it is up-to-date and reported to Council in line with this policy. The Office of General Counsel is also responsible for the management of the request for contract signing (available at Office of General Counsel: Request for contract signing (SharePoint)). 

The Deputy Vice-Chancellor (Research) and the Research Committee support research translation and provide reports on research translation to Council. 

The Investment Committee is the management committee established by the Vice-Chancellor to assess investment risks and opportunities and provide investment advice and guidance to UTS management. 

The Property Steering Committee is the management committee established by the COO to provide advice and guidance to the COO on the management, allocation and use of property at UTS (refer also Space Management Policy).

6. Definitions

The following definitions apply for this policy and all associated procedures. These are in addition to terms defined in Part 4 of the UTS Act and Schedule 1, Student Rules. Definitions in the singular include the plural meaning of the word.

Approval authority (or approver) means Council or the UTS staff member with responsibility for approving a proposal for the establishment of a commercial activity in line with this policy and the procedure. Approval authorities must be satisfied that the requirements of the UTS Act and this policy have been met in advance of approval and may seek additional advice from evaluators, the Office of General Counsel and/or Council committees as necessary. The approval authority of a proposed activity must not be the sponsor of the activity.

Commercial activity (or activity) is defined in section 2 and Appendix 1 of this policy.

Controlled entity means any person, group of people or body as defined in section 16A of the UTS Act. Controlled entities are commercial activities. 

Evaluator means the UTS staff member responsible for evaluating a proposal for a commercial activity in line with this policy and the procedure. Evaluators must be satisfied that the requirements of the UTS Act and this policy have been met in advance of submission to the approval authority. Evaluators may also provide additional advice and context for approval authorities.

Proposal means any formal proposal developed in line with this policy and the procedure for the university to participate in a commercial activity. Proposals must be submitted on UTS’s formal proposal documentation as outlined in the procedure.

Research commercialisation is defined in the Research Policy. 

Research translation is defined in the Research Policy.

Responsible owner means the UTS individual/individuals responsible for the relationship with the controlled entity or commercial activity after the completion of the approval process. The responsible owner(s) should be identified, or the process for selecting the responsible owner should be identified, as part of the proposal. A member of the senior executive must be the responsible owner for controlled entities and commercial activities that are considered higher risk.

Risk is defined in the Risk Management Policy and for the purposes of this policy includes:

  1. risk of financial loss
  2. risk of incurring a legal liability
  3. risk of loss of or damage to the reputation of the university
  4. risk of corruption or malpractice
  5. risk to workplace health, safety and wellbeing
  6. risk of impairment of the conduct of UTS’s principal functions under section 6 of the UTS Act
  7. risk of adverse tax or duty consequences to the university
  8. other risks specific to a particular commercial activity where those risks are believed to be material, or
  9. any other type of risk determined by Council to be a risk.

Serious wrongdoing is defined in the Whistleblowing and Public Interest Disclosures Policy.

Sponsor means the individual(s) responsible for proposing the establishment of a commercial activity under the scope of this policy.