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Diversity reporting deadline approaches

By Ben Chapman-Smith

Joan Withers, chairperson of Auckland International Airport, is one of few women on NZX listed company boards. Photo / Wayne Drought
Joan Withers, chairperson of Auckland International Airport, is one of few women on NZX listed company boards. Photo / Wayne Drought

New rules designed to improve gender diversity on the boards of listed companies in New Zealand will come into force at the end of this month.

In July, the NZX announced that companies on the NZX would have to disclose how many women they had on their boards and in senior management.

Companies with a formal diversity policy would also be required to evaluate their performance with respect to that policy.

The Financial Markets Authority recently gave the green light for the new diversity reporting measures, meaning companies will have to include the information in their annual reports from December 31.

As the majority of New Zealand's listed companies end their financial years in either March or June, most will not have to supply any data on gender metrics until midway through next year.

The Equal Employment Opportunities Trust (EEOT) was this week "celebrating" the changes and urging companies to endorse them.

Research showed that diversity in management and governance could play a big part in improving a company's performance, said EEOT chair Michael Barnett.

"I am asking boards and chief executives to acknowledge the value and importance of having more women in higher positions, based on merit.

"There are plenty of skilled and educated women who deserve to be included in companies' talent pipelines."

All companies - be they private or state sector - should be looking to appoint more women on boards as it would result in better morale, increased profits and productivity, Barnett said.

According to the Human Rights Commission's 2012 New Zealand Census of Women's Participation, women held 14.75 per cent of top 100 NZSX company directorships. This was an increase from 9.3 per cent in 2010.

Of those top 100 companies, 55 per cent had no female directors and there were only five female chief executives.

PGG Wrightson, which had no women on its board of seven members, saw the changes as a positive step, said company secretary Julian Daly.

"It's the way things have been moving for some time and we're certainly supportive of the direction the NZX is taking.

"We want to be progressive and move with the times."

An obstacle to having more women in senior positions was a traditional lack of female presence in the agriculture sector, Daly said.

But the company was seeing more women emerging as top thinkers in the industry.

Fletcher Building, which currently had two women on its board of eight directors, said it already complied with the new requirements.

"We put a great deal of focus on diversity and the new requirements will likely act as an encouragement for other companies to do the same, without placing a significant time or cost burden on them," said Kate Daly, group general manager of human resources.

The company had a diversity policy in place and monitored its performance against this policy on a regular basis, she said.

Daly, also a board member on the EEOT, said Fletcher Building also faced challenges recruiting females, probably much more so than the retail, banking and other sectors.

"The nature of the work we do - building materials manufacture, distribution and construction contracting - doesn't attract significant female interest, which presents challenges from the graduate level through to executive management and board level.

"We are focused on our female recruitment initiatives, which currently include targeting females for branch manager roles and recruiting and developing female engineers."

The NZX is working with the Ministry of Women's Affairs and the 25 per cent Group to implement the new policy and had a target of 15 per cent female board participation by 2015.

The NZX will shortly publish final guidelines for its new gender disclosure rules.

The new diversity rule will require listed firms to:
* Provide a breakdown of the gender composition of their directors and senior management.
* If they have a formal diversity policy to give an evaluation of their performance.

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