FMA releases updated corporate governance handbook for feedback

 

Media Release
MR No. 2014 – 038
10 November 2014

The Financial Markets Authority (FMA) today published a revised version of its handbook on corporate governance for consultation.

The newly revised Draft Principles and Guidelines Corporate Governance in New Zealand, is now available for feedback until 5pm Monday 1 December 2014.

First produced in 2004, the updated handbook is intended as a reference guide for directors, executives and advisers, to help them decide how best to apply key corporate governance principles, as set out by the FMA.

“In recent years, there has been an increasing focus on corporate governance, particularly in light of the contribution of governance failings to the impact of the Global Financial Crisis,” said Simone Robbers, FMA Director of Primary Markets and Investor Resources.

The updated handbook also helps to bring more focus on how good corporate governance and board behaviour supports the principles underpinning the Financial Markets Conduct Act, which takes full effect from 1 December.

“While the nine core principles for running a good board remain fundamentally unchanged, we have refreshed the guidance and commentary so they remain useful in the current business environment. We’ve taken into account the issues directors and professionals face in their governance roles, and relevant developments in international best practice,” she says.

The nine principles are:

  • Ethical standards
  • Board composition and performance
  • Board committees
  • Reporting and disclosure
  • Remuneration
  • Risk management
  • Auditors
  • Shareholder relations
  • Stakeholder interests.

Ms Robbers said the FMA had refreshed the guidelines in key areas such as board composition, diversity, the use of board committees, the relationship of boards with their auditors and risk management.

“When executed with the appropriate processes and systems in place, effective corporate governance minimises risks and allows those in governance roles to perform their duties with confidence. Good corporate governance also plays a vital role in contributing to better outcomes for investors, businesses, shareholders and the economy as a whole,” said Ms Robbers.

To provide feedback, please click here.

Alongside these core principles, the FMA will soon release a short guide for directors of companies considering a public listing on the NZX.

ENDS

Contact:
Andrew Park
09 967 1215
021 220 6770
andrew.park@fma.govt.nz