Who cares about responsible governance?

In some cases, New Zealand’s corporates seem little bothered about even complying with the New Zealand Securities Commission’s Principles and Guidelines of Corporate Governance.

Duncan Paterson is chief executive of Corporate Analysis Enhanced Responsibility (CAER), the Canberra-based organisation that measures the governance and senior management performance of the NZX 50 for institutional investor AMP Capital.

According to him, no NZX 50 company has an “advanced” environmental, social and governance (ESG) risk rating, only 19 percent are rated “good”, 23 percent qualify as “intermediate” and lamentable 57 percent provide limited or no evidence of making any commitment to an ESG performance measure.

At the heart of responsible governance measures are questions such as:

Does the company have an approved code of ethics?
Is the code published?
Does it include measures for dealing with breaches of the code?
Is employee and management training on the provisions and practices of the code provided?
Is implementation of, and compliance with, the code monitored and reported on?
Does the company provide whistle-blowing procedures?
Are there procedures for implementing and reviewing the code?
Do board policies describe the company’s relationships with significant stakeholders?
Does the board regularly assess compliance with these policies?

In the first of major new series of articles investigating responsible governance and what it means to some of New Zealand’s larger enterprises, Reg Birchfield talked to Abano Healthcare’s chair Alison Paterson and managing director Allan Clarke in NZ Management’s April issue.

 

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