- ASX Principles of Good Corporate Governance Influence Board Composition, Guidelines, and Selection of New Directors -

SYDNEY, November 30, 2004 – The Principles of Good Corporate Governance that were introduced in 2003 by the ASX Corporate Governance Council are influencing the practices of companies in Australasia, according to the 31st Annual Board of Directors Study, released last week by Korn/Ferry International (NYSE:KFY), the premier provider of executive search and leadership development solutions. The unique issues in Australasia add to the diversity of the Asia Pacific region’s governance practices, which continue to evolve.

The most comprehensive, longest-running survey of its kind, the Board of Directors Study examines opinions and practices found in boardrooms of major corporations throughout the world. The findings for Australasia (which formed part of the Asia Pacific section of the Global Study) were based on the responses of over 50 chairmen and directors of Australasia’s Top 200 companies.

This year’s study shows that Australasia is leading the Asia Pacific region in its response to corporate governance reform:

• Corporate Governance.
  Almost 96 percent of Australasian Director respondents say that their companies have adopted formalized, written guidelines on corporate governance. This compares most favourably to the 79 percent of Directors throughout Asia Pacific who indicated that their board has established written guidelines.
  
  
• Board Performance Reviews.
  Regular evaluations of board performance are becoming more widely accepted in companies across Asia Pacific. In Australasia, almost 80% of the Directors surveyed reported that their entire board undergoes a regular formal full board performance review, with almost two-thirds of those utilizing outside firms to manage the process.
  
  
• Board Composition.
  90 percent of Australasian respondents do not believe that the former CEO should sit on the Board, contrasting to their Non-Japan Asia counterparts, half of whom believe the incumbent should retain their seat. As Australasian companies comply with the ASX recommendations to report on how they select and appoint new directors, an increasing trend to use search firms to identify high quality director candidates is revealed, with 65 percent of respondents stating that their board is “very likely” or “likely” to do so. This is a welcome trend from practices in years past when “the mates’ network” was the more likely source of candidates.

“It is clear from this year’s study that the larger companies in Australasia are implementing the recommendations of the ASX Corporate Governance Council and that their behaviours are indicating a more progressive attitude towards corporate governance than the companies of many other nations,” said Suzanne Williams, client partner in the Sydney office and head of Korn/Ferry’s Board Services Practice in Australasia.

Methodology
Korn/Ferry International retained PeopleMetrics, Inc., a leading marketing research firm, for survey preparation and data analysis, providing continuity of methodology for this global study. Board members in the Americas, Asia Pacific, Europe and, for the first time, South Africa, were invited to participate. Nearly 1,000 directors from 14 nations returned a completed questionnaire.

About Korn/Ferry International
Korn/Ferry International, with more than 70 offices in 35 countries, is the premier provider of executive search and leadership development solutions. Based in Los Angeles, the firm partners with clients worldwide to deliver unparalleled senior-level search, management assessment, coaching and development and middle management recruitment services through its Futurestep subsidiary. For more information, visit the Korn/Ferry International Web site at www.kornferry.com or the Futurestep Web site at www.futurestep.com.