Another member lost to watchdog

Elizabeth Hickey. Photo / Supplied

A second member of the Securities Commission has quit, leaving the investment watchdog down on leadership at one of its busiest times.

Commerce Minister Simon Power said yesterday he had accepted the resignation of Elizabeth Hickey.

Hickey, who is leaving for personal reasons, will finish at the end of this week after serving less than two years of a five-year term.

Her resignation follows that of David Jackson on April 14.

Jackson resigned after the commission said it would file civil proceedings against him for his role as a director of listed resins and paint manufacturer Nuplex.

The commission alleges that between December 2008 and February 2009 Nuplex breached continuous disclosure rules. It has filed proceedings against six current and former directors.

The resignations come at a time when the commission is under pressure over finance company investigations.

It is in the process of investigating 41 finance companies.

So far it has laid charges against four - Bridgecorp, Capital + Merchant, Nathans Finance and Lombard.

Power is also considering whether to form a single regulatory body through merging the commission, parts of stock exchange operator NZX's disciplinary arm and the Companies Office's National Enforcement Unit.

The departures mean the load carried by the two commissioners will have to be shared out among the remaining nine.

The Herald understands three commissioners are assigned to each investigation and it is they who make a final call on whether legal action will be taken.

Power said the two resignations were not ideal, "[but] I am confident that the remaining members will be able to carry out the work required".

Des Hunt, deputy chairman of the New Zealand Shareholders Association, said it did not have a problem with the resignations because it believed the members needed to be changed after a lack of action in recent years over finance company collapses.

"I think those members sitting on the commission have to take responsibility for very little action in the last few years."

Hunt said its biggest concern was the quality of new people selected to become commissioners.

"We would support a clean-out [of commissioners] so long as we get quality people go back on."

Hunt said one issue of concern in New Zealand was that some commissioners were also directors on companies that may be investigated.

The Securities Commission is in charge of investigating any concerns raised about the continuous disclosure by publicly listed companies.

As well as being on the board of Nuplex, Jackson is also on the board of Pumpkin Patch, the New Zealand Refining Company and dairy co-operative Fonterra.

Hickey, a chartered accountant, is not on the board of any publicly listed companies.

She is on the board of the New Zealand Institute of Chartered Accountants and not-for-profit Southern Cross Healthcare Group. Last year she was appointed an adjunct professor in the department of accounting and finance at the University of Auckland.

Previously Hickey spent five years at the International Accounting Standards Board in London where she was responsible for 45 staff developing the International Financial Reporting Standards (IFRS).

The Governor-General is in charge of appointing members to the Securities Commission based on recommendations made by the Commerce Minister.

Power said he had asked the Ministry of Economic Development to provide him with advice on the timing, process and skills needed in the commission following the resignations.

The Securities Commission must have at least five commissioners and can have up to a maximum of 11.

Securities Commission

Resigned:

Elizabeth Hickey
David Jackson

Remaining commissioners:

Jane Diplock
David Mayhew
Simon Botherway
Shelley Cave
Annabel Cotton
Keitha Dunstan
John Holland
Neville Todd
Mark Verbiest