s9(2)(a)
Dear s9(2)(a)
I have pleasure in formally offering you appointment as a director of New Zealand Post
Ltd from 14 November 2024 up to 30 April 2027.
The appointment is made on the basis that you are not disqualified from being appointed,
or holding office as, a director of a company under section 151 of the Companies Act
1993. If at any time after your appointment you become disqualified from holding office as
a director, you must inform the shareholders immediately. The appointment is also subject
to the satisfactory completion of background checks.
Please note that you will hold office at the pleasure of shareholding Ministers, and that
you may be removed as a director at any time, and for any reason, by written notice by
shareholding Ministers to the company.
On taking up this appointment you will ensure that you are appropriately indemnified and
insured by the company, which may require a new board resolution and certificate. You
could discuss this with the company’s management. You are also welcome to take out
additional insurance at your own cost if you wish.
You will be aware that responsibilities placed upon directors have increased in recent
years and are still subject to significant change from time to time. If you have not already
done so, I strongly recommend that you make yourself familiar with the legal rights and
obligations of directors. A key element of your obligation as a director is the need for
confidentiality with regard to the board and board committee discussions.
Schedule 1 to this letter sets out the Government’s expectations in regard to the avoidance
of conflict of interest situations by directors of Crown company boards.
As a Crown director you will need to exercise particular care around political neutrality
which requires all Crown board members to act in a politically impartial manner,
irrespective of their political interests.
I also expect you to familiarise yourself with the contents of the Owner’s Expectations
document which outlines shareholding Ministers' expectations of the companies fully or
partially owned by the Crown. The manual and related updates are at
https://treasury.govt.nz/publications/guide/owners-expectations-manual.
It is also possible that you may be placed in a situation where, as a result of circumstances
which are not related to your directorship of this particular company, your continuing to act
as a director of this company might nevertheless place this company or the shareholders
in a difficult position. Consistent with your primary duty to act in the best interests of the
company, if you find yourself in such a situation you must take the initiative and raise the
matter with the Chair or me, if appropriate. While there are no set criteria for such
situations, examples of the types of issues the shareholders would expect to be advised
on include:
•
where legal proceedings have been, or are likely to be, brought against the director
•
where the director has been, or is likely to be, subject to negative media or public
scrutiny
•
where the director is placed in a situation of actual or perceived conflict of interest
•
any issue affecting the director’s ability to contribute to the board (for example, as
a result of other time pressures, extended overseas travel (ie more than two
months, illness, etc)
•
where the director is appointed to any position as an employee of the Crown, or
intends to undertake significant contract work for any Crown agency
•
any other similar circumstance which may place the company or the shareholders
in a difficult or embarrassing position.
I congratulate you on being offered this appointment and look forward to your ongoing
contribution. If you wish to accept the appointment, please sign the enclosed “Agreement
to Accept Appointment” and return it via email as per the email address on the declaration.
Yours sincerely
Hon Chris Bishop
Acting Minister for State Owned Enterprises
on behalf of shareholding ministers
Enc
Crown Company Directors Management of Conflicts of Interest – Schedule 1
Terms of Reference for Directors of State-owned Enterprises - Schedule 2
Agreement to Accept Appointment
Cc: [email address]
Crown Company Directors Management of Conflicts of Interest – Schedule 1
It is necessary that new appointees to Crown company boards be advised of the expectations
of shareholding Ministers with regard to the management of conflicts of interest that may arise
in the course of their term as a director.
Directors occupy a fiduciary position, which requires a director to act bona fide in what the
director considers is in the best interests of the company. Accordingly, directors are required
by law not to place themselves in a position of a conflict of interest other than to the extent
allowed under the Companies Act 1993 and the company’s constitution.
It is expected that all directors make themselves familiar with the obligations required of a
director in terms of the Companies Act 1993. Nothing in this statement obviates any directors’
responsibility in this regard. However, it is important that appointees are aware of the
additional expectations of the shareholding Ministers with regard to conflicts of interests.
Shareholding Ministers expect that no director on the board of a Crown-owned company or
subsidiary company will undertake work for that company. This expectation is not intended to
preclude a director from undertaking assignments for the board which properly fall within the
definition of a director’s duties, but would preclude the director carrying out, say, a consulting
assignment for the management of the company.
Shareholding Ministers also expect that directors of Crown-owned companies should not be
placed in a conflict of interest through the involvement of an organisation with which the
director has an ongoing substantial commercial or professional interest or employment, with
a Crown-owned company of which they are a director. Two situations that could create a
conflict of interest where Crown-owned companies engage organisations in which directors
have such an interest are:
1.
Where the organisation has been engaged for a one-off, specific assignment.
2.
Where the organisation engaged has an on-going involvement with the Crown-owned
company.
With regard to the first situation, shareholding Ministers consider that, provided the director
concerned declares his/her interest in the organisation to be engaged for the assignment and
takes the appropriate actions under the Companies Act 1993 and the company’s constitution
(eg refraining from voting), it is unlikely that the organisation need be excluded from
undertaking the assignment. To exclude the organisation could unduly penalise organisations
from competing for business, especially when they operate in highly specialised areas.
However, boards of Crown-owned companies will also need to consider whether the affected
director should be party to the service to be provided by his/her organisation to the Crown-
owned company. Shareholding Ministers expect directors in this situation to distance
themselves from the provision of service or advice although, in a highly specialised sector,
this may not always be possible. The company’s board should give careful consideration to a
director’s involvement in deliberations on the assignment.
The second situation referred to above causes shareholding Ministers greater concern, ie
where the organisation engaged has an on-going involvement with the Crown-owned
company.
The situation can arise from the company engaging, say, legal, accounting or other
professional advice or services. Many of these firms are the source of a large number of
directors and the potential for conflicts of interest is high.
In principle, the conflict of interest provisions in the Companies Act 1993 and the company’s
constitution should provide adequate protection against allegations of conflicts of interest, but
shareholding Ministers have additional concerns that those provisions do not entirely remedy.
A director who frequently stands aside from board decision-making places a greater burden
on the remainder of the board. This can also deny the board the skills and experience of a
director, which is not (generally speaking) in the best interests of the Crown-owned company.
There is also potential for Ministers and boards to be significantly distracted by allegations of
conflicts, as the need to address each allegation can be time-consuming.
Accordingly, shareholding Ministers wish to convey to all directors an expectation that Crown-
owned companies should not engage in an on-going arrangement with an organisation in
which a director has an interest of the nature outlined in this letter.
Shareholding Ministers are of the view that Crown-owned companies should be beyond
reproach. Following the expectations of shareholding Ministers described in this statement
should ensure that this is so. In the event that exceptions to these measures appear
appropriate, they should be referred to the shareholding Ministers.
Terms of Reference for Directors of State-owned Enterprises - Schedule 2
Background
The board of a State-owned enterprise (SOE) has essentially the same role as that of a private
company board. SOEs are limited liability companies established under, and subject to, the
Companies Act 1993. In addition, they are also subject to the State-Owned Enterprises Act
1986 (SOE Act 1986), which in essence:
•
establishes that the principal objective of every SOE is to be a successful business
•
clarifies reporting and accountability structures
•
restricts the ability of shareholding Ministers to interfere in operational management
•
establishes transparent mechanisms for Ministers to direct SOEs should that be
necessary.
Shareholding Ministers appoint a board of directors to govern and oversee the management
of each SOE. Under the Companies Act 1993, the Board is required to act in good faith and
in what they believe to be in the best interests of the company.
Key Requirements
The key requirements of the Director position are to:
•
ensure effective accountability and governance of the SOE, consistent with the
requirements of the SOE Act 1986 and the Companies Act 1993
•
to maximise shareholder value.
Accountabilities
You are accountable to the shareholding Ministers (the Minister for State Owned Enterprises
(the responsible Minister), and Minister of Finance) in the manner set out in the SOE Act 1986.
The primary accountability document between the board and the shareholding Ministers is the
Statement of Corporate Intent (SCI). The SCI is a public document tabled in the House of
Representatives annually. The board is responsible for meeting the targets and outcomes in
the SCI.
In addition, boards are expected to produce the following documents:
•
an annual business plan
•
quarterly reports on the financial and non-financial performance of the SOE within one
month of the end of the quarter under review
•
a half-yearly report within two months of the end of the first half of each financial year
•
an annual report within three months of the end of each financial year.
Shareholding Ministers have adopted a “no surprises” policy. The board (usually through its
chair) is expected to advise Ministers and/or their advisors of any material event or
circumstance, wherever possible well in advance of its occurrence, that could affect
shareholder value, cause embarrassment or be of significant interest to the shareholders.
Directors may also be required to provide information to, and appear before, select committees
on behalf of the company.
Specific Terms of Reference
Shareholding Ministers expect you to:
•
contribute to the continual review and updating of the SOE’s governance arrangements
and risk management policies to ensure they reflect current best practice. It is expected
that sub-committees of the board will be formed to ensure appropriate governance,
review and risk management focus is applied by the board to the business of the
company
•
contribute in a positive fashion to Board discussions based on your own skills,
experience and judgement
•
work constructively with the Chair and other directors to ensure that the Board
undertakes its work efficiently and effectively. It is expected that the Chair will, in
consultation with the board, develop an annual work plan for the board
•
define, agree and implement a business strategy that will ensure the viability and
sustainability of the SOE in a manner consistent with the owner’s expectations and the
relevant provisions of the SOE Act 1986
•
present to shareholding Ministers by 1 May each year (or as agreed) a draft strategic
plan and SCI for at least the next three years
•
employ a Chief Executive who will assist the company to meet the strategic and
operational objectives as set by the Board
•
provide the necessary guidance and support to the Chief Executive and his/her senior
management team to ensure the SOE is managed effectively and efficiently on a day-
to-day basis, and that the targets and outcomes in the SCI are met
•
monitor the performance of the chief executive
•
generally act in a manner consistent with your obligations as a directors under the SOE
Act 1986 and the Companies Act 1993.
In addition, all directors should take the necessary steps to satisfy themselves of their statutory
and best practice obligations.
Agreement to Accept Appointment
Hon Chris Bishop
Minister for State Owned Enterprises
PARLIAMENT BUILDINGS
WELLINGTON 6160
Dear Minister
I acknowledge receipt of your letter offering me appointment as a director of New Zealand
Post Ltd from 14 November 2024 up 30 April 2027.
I confirm my acceptance of this appointment on the terms and conditions of the
appointment letter.
I accept that I hold office at the pleasure of shareholding Ministers, and that shareholding
Ministers can remove me as a director at any time, and for any reason, by written notice
by shareholding Ministers to the company. I also accept that the appointment is subject to
the satisfactory completion of background checks.
I will ensure that I keep myself fully familiar with the obligations and responsibilities of the
position, and ensure that the company has taken any necessary steps to arrange for an
indemnity and/or insurance for me in my position as a director.
I confirm that I am not disqualified from being appointed, or holding office, as a director.
I also confirm that I have, to the best of my knowledge, advised the Treasury of all relevant
facts about me that the shareholders should be aware of in considering me for
reappointment. I undertake to advise the shareholders, via the Treasury, of any change in
my circumstances that may have an impact on my ability to continue to serve on the Board.
Yours sincerely
s9(2)(a)
Date:
Please return via email to: [email address]
