Reference: 20240682
23 September 2024
John Luke
[FYI request #28200 email]
Dear John
Thank you for your Official Information Act request, received on 26 August 2024. You
requested the following:
… your most current template letter of appointment and most recent sent letter of
appointment on file, of course you can remove any name/address in relation to
privacy act requirements.
The request was clarified 7 September:
the templates for all the different entity types.
One template for each of the entity types would be sufficient.
Information being released
Please find enclosed the following documents:
Item Document Description
1. SOE Appointment letter Template
2. Schedule 4A Crown-owned Company Appointment Letter Template
3. Crown Entity Company Appointment Letter Template
4. Crown Entity Appointment Letter Template
5. Min Goldsmith RNZ appointment letter (most recent letter of appointment sent)
Please note that this letter (with your personal details removed) and enclosed
documents may be published on the Treasury website.
This reply addresses the information you requested. You have the right to ask the
Ombudsman to investigate and review my decision.
Yours sincerely
Simon Wi Rutene
Principal Advisor, Governance and Appointments
1 The Terrace
PO Box 3724
Wellington 6140
New Zealand
tel. +64-4-472-2733
https://treasury.govt.nz
link to page 3 link to page 10 link to page 15 link to page 20 link to page 25
Table of Contents
1.
SOE Appointment letter Template
1
2.
Schedule 4A Crown-owned Company Appointment Letter
8
3.
Crown Entity Company Appointment Letter
13
4.
Crown Entity Appointment Letter
18
5.
MIN GOLDSMITH RNZ appointment letter
23
Doc 1
Page 1 of 27
NAME of new appointment
email.address@com
Dear NAME
I have pleasure in formally offering you appointment as a director of ENTITY for a period
from DATE up to DATE.
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.
Official Information
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
Act 1982
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:
Doc 1
Page 2 of 27
•
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 XXX XXXXX
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]
Official Information
Act 1982
Crown Company Directors Management of Conflicts of Interest – Schedule 1
Doc 1
Page 3 of 27
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
Official Information
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
Act 1982
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.
Doc 1
Page 4 of 27
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.
Official Information
Act 1982
Terms of Reference for Directors of State-owned Enterprises - Schedule 2
Doc 1
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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
Official Information
• 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.
Act 1982
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
Doc 1
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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.
Official Information
Act 1982
Doc 1
Page 7 of 27
Agreement to Accept Appointment
Hon XXX XXXXXX
Minister for State Owned Enterprises
PARLIAMENT BUILDINGS
WELLINGTON 6160
Dear Minister
I acknowledge receipt of your letter offering me appointment as director of ENTITY for a
period from DATE up to DATE.
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
Official Information
Xxxxx xxxx XXXXXX
Act 1982
Date:
Please return via email to:
[email address]
Doc 2
Page 8 of 27
NAME of new appointment
Email.address@.com
Dear NAME
I have pleasure in formally appointing you as a director of ENTITY from DATE up to
DATE.
ENTITY is a Crown-owned company which is incorporated under the Companies Act
1993 and is listed on Schedule 4A of the Public Finance Act 1989. The appointment is
made on the basis that you:
•
have consented in writing to be a director
•
are not disqualified from being appointed, or holding office as, a director of a
Crown-owned company as outlined in Section 151 of the Companies Act 1993
•
have disclosed the nature and extent of the interests that you have, or are likely to
have, in matters relating to the company
•
are not 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 board 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 board directors. A key element of your obligation is the need for
Official Information
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.
Act 1982
Please also ensure that you have familiarised yourself with the Code of Conduct for
Directors of Schedule 4A Companies, available on the
Te Kawa Mataaho Public Service
Commission website, which sets out minimum standards of integrity and conduct you
are expected to follow. The Code reinforces the requirement of political neutrality which
requires all Crown entity Board members to act in a politically impartial manner,
irrespective of their political interests. Consistent adherence to this Code is critical to
ensure that Crown boards and board members conduct themselves in a way that
maintains public trust and confidence.
Treasury:4851602v1
APPOINTMENT-IN-CONFIDENCE
1
Doc 2
Page 9 of 27
It is also possible that you may be placed in a situation where, as a result of
circumstances which are not related to your position as a director of ENTITY, your
continuing to act as a director might nevertheless place the company or the shareholders
in a difficult position. Consistent with your 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 and, if appropriate, me. While there are no set criteria for such situations,
examples 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 2
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 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. Your induction to the company is the responsibility of the chair and will be discussed
directly with you. However, the Treasury does arrange a one day induction seminar for
new directors outlining the realities of Crown ownership, the expectations of Ministers
and the roles of the key players.
I congratulate you on this appointment and look forward to your contribution. If you wish
to accept the appointment, please sign the enclosed “Agreement to Accept Appointment”
and return via email as per the email address on the acknowledgement.
Yours sincerely
Official Information
Hon XXX XXXXX
Minister for XXXXXXX
Act 1982
On behalf of shareholding Ministers
Crown Company Directors Management of Conflicts of Interest - Schedule 1 Agreement to Accept Appointment
Please return via email to: [email address]
Treasury:4851602v1
APPOINTMENT-IN-CONFIDENCE
2
Doc 2
Page 10 of 27
Crown Company Directors Management of Conflicts of Interest - Schedule 1
It is necessary that appointees to Crown company boards be advised of the
expectations of the Minister with regard to the management of conflicts of interest
that may arise in the course of their term.
Directors occupy a fiduciary position, which requires them to act bona fide in what
the director considers is in the best interests of the company. Accordingly, directors
are required not to place themselves in a position of a conflict of interest other than
to the extent al owed 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 director responsibility in this regard. However, it is important that
appointees are aware of the additional expectations of the Minister with regards to
conflicts of interests.
The Minister expects that no director on the board of a Crown company or
subsidiaries will undertake work for the 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.
The Minister also expects that directors of Crown 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 company of which they are a director. Two situations
that could create a conflict of interest where Crown entity companies engage
organisations in which directors have such an interest are:
1.
Where the organisation has been engaged for a one-off, specific
assignment; and
2.
Where the organisation engaged has an on-going involvement with the
Crown company.
Official Information
With regard to the first situation, the Minister considers that, provided the concerned
director 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 Act 1982
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 are in highly specialised areas.
However, the board of the company will also need to consider whether the affected
director should be party to the service to be provided by his/her organisation to the
company. The Minister expects a director in this situation to distance themselves
from the provision of service or advice although, in a highly specialised sector, this
Treasury:4851602v1
APPOINTMENT-IN-CONFIDENCE
3
Doc 2
Page 11 of 27
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 the Minister greater concern, ie
where the organisation engaged has an on-going involvement with the company.
The situation can arise from the company engaging, say, legal, accounting or other
professional advice or services. Many of these firms are sources for 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 direction against allegations of
conflicts of interest, but the Minister has additional concerns that those provisions
do not entirely remedy the situation. 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 company. There is also potential
for the Minister and boards to be significantly distracted by allegations of conflicts.
The need to address each allegation can be time-consuming.
Accordingly, the Minister wishes to convey to all directors that the company 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.
The Minister is of the view that Crown companies should be beyond reproach.
Following the expectations of the Minister 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 Minister.
Official Information
Act 1982
Treasury:4851602v1
APPOINTMENT-IN-CONFIDENCE
4
Doc 2
Page 12 of 27
Agreement to Accept Appointment
Hon XXX XXXXXX
Minister for XXXXXXXX
PARLIAMENT BUILDINGS
WELLINGTON 6160
Dear Minister
I acknowledge receipt of your letter reappointing me as a director of ENTITY Ltd for a
period from DATE up to DATE.
I accept that I will hold office at the pleasure of shareholding Ministers, and that
I may be removed as a director at any time, and for any reason, by written notice by
shareholding Ministers to the company.
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 undertake to advise you, 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
xxx XXXXXXXXX
Official Information
Date:
Please return via email to: [email address]
Act 1982
Treasury:4851602v1
APPOINTMENT-IN-CONFIDENCE
5
Doc 3
Page 13 of 27
NAME of new appointment
Email.address@.com
Dear NAME
I have pleasure in formally appointing you as a MEMBER of ENITITY for a period
from DATE up to DATE.
• The appointment is made under sections 28-35 of the Crown Entities Act 2004
and is on the basis that you:
•
have consented in writing to be a director
•
are not disqualified from being appointed, or holding office as, a director of a
Crown entity company, and
•
have disclosed the nature and extent of the interests that you have, or are likely
to have, in matters relating to the company.
If, at any time after your appointment, you become disqualified from holding office as
a director of a Crown entity company 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. You could discuss this with the company’s
management. You are welcome to take out additional insurance at your own cost if
you wish.
You will be aware that responsibilities placed upon board members have increased
in recent years and are still subject to significant change from time to time. If you
Official Information
have not already done so, I strongly recommend that you make yourself familiar with
the legal rights and obligations of board members. A key element of your obligation
is the need for confidentiality with regard to the board and board committee
discussions.
Act 1982
Schedule 1 to this letter sets out the shareholder’s expectations in regard to the
avoidance of conflict of interest situations by directors of Crown company boards.
It is also possible that you may be placed in a situation where, as a result of
circumstances which are not related to your position as a MEMBER of ENITITY, your
continuing to act as a Director might nevertheless place the company or the
shareholders in a position of embarrassment. Consistent with your duty to act in the
best interests of the company, if you find yourself in such a situation you must take
Doc 3
Page 14 of 27
the initiative and raise the matter with the Chair and, if appropriate, me. While there
are no set criteria for such situations, examples 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 (i.e. more than
two months), illness, etc), and
•
any other similar circumstance which may place the company or the
shareholders in a position of embarrassment.
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. Please also ensure that you have familiarised yourself with the Code of Conduct for
Directors of Crown Entity Board Members, available on the
Te Kawa Mataaho Public
Service Commission website, which sets out minimum standards of integrity and
conduct you are expected to follow. The Code reinforces the requirement of political
neutrality which requires all Crown entity Board members to act in a politically impartial
manner, irrespective of their political interests. Consistent adherence to this Code is
critical to ensure that Crown boards and board members conduct themselves in a way
that maintains public trust and confidence.
I congratulate you on this reappointment and look forward to your contribution. If you
wish to accept this reappointment, please sign the enclosed “Agreement to Accept
Appointment” and return it via email as per the email address on the declaration.
Yours sincerely
Official Information
Hon XXX XXXXX
Minister of XXXXXXXX
Act 1982
Enc
Crown Company Directors - Management of Conflicts of Interest - Schedule 1 Agreement to Accept Appointment
Cc: [email address]
Doc 3
Page 15 of 27
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 fal 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.
Official Information
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
Act 1982
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.
Doc 3
Page 16 of 27
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 al egations 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.
Official Information
Act 1982
Doc 3
Page 17 of 27
Agreement to Accept Appointment
Hon XXX XXXX
Minister of XXXXX
PARLIAMENT BUILDINGS
WELLINGTON 6160
Dear Minister
I acknowledge receipt of your letter offering me appointment as MEMBER or
ENITITY for a period from DATE up to DATE.
I confirm my acceptance of this reappointment on the terms and conditions of the
reappointment 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 entity has taken any necessary steps to arrange
for an indemnity and/or insurance for me in my position as a director.
I undertake to advise you, 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
Xxx xxx XXXXXX
Date:
Official Information
Act 1982
Please return signed acceptance via email to: [email address]
Doc 4
Page 18 of 27
NAME of new appointment
email.address@com
Dear NAME
I have pleasure in formally offering you appointment as a MEMBER of ENTITY for a period
from DATE up to DATE.
The appointment is made under sections 28-35 of the Crown Entities Act 2004 and (insert
entities other Acts here and is on the basis that you:
•
have consented in writing to being a member
•
have certified that you are not disqualified from being a member
•
have disclosed the nature and extent (including monetary value, if quantifiable) of all
interests that you have, or are likely to have, in matters relating to the ENTITY.
If at any time after your appointment you become disqualified from holding office as a
member you must inform me immediately. A list of the persons who are disqualified from
holding office as a member is set out in section 30 of the Crown Entities Act 2004. 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 entity. You could discuss this with the entity’s management. You are
welcome to take out additional insurance at your own cost if you wish.
You will be aware that responsibilities placed upon board members 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 board members. A key element of your obligation is the need for
confidentiality with regard to the board and board committee discussions.
Official Information
Schedule 1 to this letter sets out the Minister’s expectations in regard to the avoidance of
conflict of interest situations by members of Crown entities.
Please ensure that you have familiarised yourself with the Code of Conduct for Directors of
Act 1982
Crown Entity Board Members, available on the
Te Kawa Mataaho Public Service
Commission website, which sets out minimum standards of integrity and conduct you are
expected to follow. The Code reinforces the requirement of political neutrality which requires
all Crown entity Board members to act in a politically impartial manner, irrespective of their
political interests. Consistent adherence to this Code is critical to ensure that Crown boards
and board members conduct themselves in a way that maintains public trust and confidence.
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 entity, your continuing to act as
a director of this entity might nevertheless place this entity or Ministers in a difficult position.
Doc 4
Page 19 of 27
Consistent with your duty to act in the best of the entity, if you find yourself in such a
situation you must take the initiative and raise the matter with the Treasury, and me, if
appropriate. While there are no set criteria for such situations, examples include:
•
where legal proceedings have been, or are likely to be, brought against the member
•
where the member has been, or is likely to be, subject to negative media or public
scrutiny
•
where the member is placed in a situation of actual or perceived conflict of interest
•
any issue affecting the member’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 member is appointed to any position as an employee of the Crown, or
intends to undertake significant contract work for any Crown entity
•
any other similar circumstance which may place the entity or Ministers in a difficult
or embarrassing position.
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 guides are at
https://treasury.govt.nz/publications/guide/owners-expectations-manual.
Your induction to the company is the responsibility of the chair and will be discussed directly
with you.
I congratulate you on this appointment and look forward to your contribution. I would be
grateful if you could sign the enclosed form acknowledging your appointment and return via
email as per the address on the Acknowledgement of Appointment.
Yours sincerely
Hon XXX XXXXX
Minister of XXXXXX
Official Information
Enc
Crown Entity Board Members - Management of Conflicts of Interest - Schedule 1 Agreement to Accept Appointment
Act 1982
Please return via email to: [email address]
Doc 4
Page 20 of 27
Crown Entity Board Members – Management of Conflicts of Interest – Schedule 1
It is necessary that new appointees to Crown entity boards be advised of the
expectations of the Minister with regard to the management of conflicts of interest that
may arise in the course of their term.
Board members occupy a fiduciary position, which requires them to act bona fide in what
the board member considers is in the best interests of the entity. Accordingly, board
members are required not to place themselves in a position of a conflict of interest other
than to the extent al owed under the Crown Entities Act 2004.
It is expected that al board members make themselves familiar with their obligations
under the Crown Entities Act 2004. Nothing in this statement obviates any board member
responsibility in this regard. However, it is important that appointees are aware of the
additional expectations of the Minister with regards to conflicts of interests.
The Minister expects that no member of the Board of the ENTITY or its subsidiaries wil
undertake work for the ENTITY. This expectation is not intended to preclude a board
member from undertaking assignments for the Board which properly fal within the
definition of a board member’s duties, but would preclude the board member carrying
out, say, a consulting assignment for the management of the ENTITY.
The Minister also expects that board members of the ENTITY should not be placed in a
conflict of interest through the involvement of an organisation with which the board
member has an ongoing substantial commercial or professional interest or employment,
with a Crown entity of which they are a board member. Two situations that could create
a conflict of interest where Crown entities engage organisations in which board members
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
entity.
With regard to the first situation, the Minister considers that, provided the concerned board
member declares his/her interest in the organisation to be engaged for the assignment
Official Information
and takes the appropriate actions under the Crown Entities Act 2004 (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 are in highly specialised areas.
Act 1982
However, the Board of the ENTITY wil also need to consider whether the affected board
member should be party to the service to be provided by his/her organisation to the
ENTITY. The Minister expects a board member 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 ENTITY Board should give careful consideration to a board
member’s involvement in deliberations on the assignment.
The second situation referred to above causes the Minister greater concern, ie where the
organisation engaged has an on-going involvement with the ENTITY.
Doc 4
Page 21 of 27
The situation can arise from the company engaging, say, legal, accounting or other
professional advice or services. Many of these firms are sources for a large number of
board members and the potential for conflicts of interest is high.
In principle, the conflict of interest provisions in the Crown Entities Act 2004 should
provide adequate direction against al egations of conflicts of interest, but the Minister has
additional concerns that those provisions may not entirely remedy the situation. A board
member 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 skil s and
experience of a board member, which is not (generally speaking) in the best interests of
the ENTITY. There is also potential for the Minister and boards to be significantly
distracted by al egations of conflicts. The need to address each al egation can be time-
consuming.
Accordingly, the Minister wishes to convey to al board members an expectation that the
ENTITY should not engage in an on-going arrangement with an organisation in which a
board member has an interest of the nature outlined in this letter.
The Minister is of the view that the ENTITY should be beyond reproach. Fol owing the
expectations of the Minister 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 Minister.
Official Information
Act 1982
Agreement to Accept Appointment
Doc 4
Page 22 of 27
Hon XXX XXXXX
Minister of XXXXXXX
PARLIAMENT BUILDINGS
WELLINGTON 6160
Dear Minister
I acknowledge receipt of your letter offering me appointment as member of ENTITY for a
period from DATE up to DATE.
I confirm my acceptance of this appointment on the terms and conditions of the
appointment letter.
I will ensure that I keep myself fully familiar with the obligations and responsibilities of the
position, and ensure that the entity has taken any necessary steps to arrange for an
indemnity and/or insurance for me in my position as a board member.
I undertake to advise you, via the Treasury, of any change in my circumstances that may
have an impact on my ability to continue to serve on the ENTITY Board.
Yours sincerely
Xxxxx xxxx XXXXXX
Date:
Please return signed acceptance via email to:
[email address]
Official Information
Act 1982
Doc 5
Page 23 of 27
Dear
I have pleasure in formally appointing you as a governor of Radio New Zealand Ltd
(RNZ) from 1 September 2024 up to 31 August 2027.
The appointment is made under sections 28-35 of the Crown Entities Act 2004 and is
on the basis that you:
•
have consented in writing to be a governor
•
are not disqualified from being appointed, or holding office as, a director of a
Crown entity company, and
•
have disclosed the nature and extent of the interests that you have, or are likely
to have, in matters relating to the company.
If, at any time after your appointment, you become disqualified from holding office as a
governor of a Crown entity company you must inform the shareholders immediately.
The appointment is also subject to the satisfactory completion of background checks.
I should point out that you will hold office at the pleasure of shareholding Ministers, and
that you may be removed as a governor at any time, and for any reason, by written
notice by shareholding Ministers to the company.
You will be aware that responsibilities placed upon board 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 board directors. A key element of your obligation is the need
for confidentiality with regard to the board and board committee discussions.
Official Information
I expect that 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.
Act 1982
Schedule 1 to this letter sets out the shareholders’ expectations in regard to the
avoidance of conflict of interest situations by directors of Crown company boards.
It is also possible that you may be placed in a situation where, as a result of
circumstances which are not related to your position as a Governor of RNZ, your
continuing to act as a governor might nevertheless place the company or the
shareholders in a position of embarrassment.
Doc 5
Page 24 of 27
Consistent with your 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 and, if
appropriate, me. While there are no set criteria for such situations, examples 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 (i.e. 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, and
•
any other similar circumstance which may place the company or the shareholders
in a position of embarrassment.
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 guides are at
https://treasury.govt.nz/publications/guide/owners-expectations-manual. Please ensure that you have familiarised yourself with the
Code of Conduct For Crown
Entity Board Members - Te Kawa Mataaho Public Service Commission, which sets out
minimum standards of integrity and conduct which you are expected to follow. The
Code reinforces the requirement of political neutrality which all Crown entity board
members are expected to follow. This includes acting in a politically impartial manner,
irrespective of personal political interests. Consistent adherence to this Code is critical
to ensure that Crown boards and board members conduct themselves in a way that
maintains public trust and confidence.
Ministers accord board, chair and director performance a high priority in ensuring that
shareholder expectations are being met. As a governor of RNZ you are expected to
have your performance evaluated in a manner intended to guide you in being a
successful, contributing governor of the board.
I congratulate you on this appointment and look forward to your contribution.
I would be grateful if you could sign the enclosed form acknowledging this appointment
and return via email as per the address on the Acknowledgment.
Official Information
Yours sincerely
Act 1982
Hon Paul Goldsmith
Minister for Media and Communications
on behalf of shareholding Ministers
Enc
Crown Company Directors Management of Conflicts of Interest – Schedule 1
Agreement to Accept Appointment
Doc 5
Page 25 of 27
Crown Company Directors Management of Conflicts of Interest – Schedule 1
It is necessary that 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, the Crown Entities Act 2004
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 and the Crown Entities Act 2004.
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 regards 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,
and
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, the
Crown Entities Act 2004 and the company’s constitution (eg. refraining from voting), it
Official Information
is unlikely that the organisation needs be excluded from undertaking the assignment.
To exclude the organisation could unduly penalise organisations from competing for
business, especially when they are in highly specialised areas.
Act 1982
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.
Doc 5
Page 26 of 27
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, the Crown
Entities Act 2004 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. The need to address each allegation can be time-consuming.
Accordingly, shareholding Ministers wish to convey to all directors 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.
Official Information
Act 1982
Doc 5
Page 27 of 27
Hon Paul Goldsmith
Minister for Media and Communications
PARLIAMENT BUILDINGS
WELLINGTON 6160
Dear Minister
I acknowledge receipt of your letter appointing me as a governor of Radio New Zealand
Ltd from 1 September 2024 up to 31 August 2027.
I accept that I hold office at the pleasure of shareholding Ministers, and that
I may be removed as a governor 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 governor.
I confirm that I am not disqualified from being appointed, or holding office, as a
governor. 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 appointment. I undertake to advise the Minister, 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
Date:
Official Information
Please return via email t
o: [email address]
Act 1982
Document Outline
