We are committed to the highest standards of business behaviour and accountability. Here we outline the main corporate governance practices we have in place. These comply with the NZX Corporate Governance Best Practice Code and the Financial Markets Authority’s Principles of Corporate Governance and Guidelines.
We uphold the highest ethical standards, acting in good faith and in the best interests of shareholders at all times. The ethical and behavioural standards we expect of directors, officers and employees are set out in our Code of Ethics. This includes policies about conflicts of interest, fair dealing, compliance with applicable laws and regulations, maintaining confidentiality of information, dealing with company assets and use of company information.
Composition of the Board
Our focus is on having a Board whose members are able to act independently and have the composite skills to optimise our financial performance and returns to shareholders. The Constitution provides for no fewer than three directors. All Board members are non-executive directors. The Board does not impose a restriction on the tenure of any director as such a restriction may lead to the loss of experience and expertise.
Having independent directors helps assure shareholders that the Board is fulfilling its role properly and is diligent in holding management accountable for its performance. By ‘independent director’ we mean independent of management and free of any business or other relationship that could materially interfere with, or could reasonably be perceived to materially interfere with, the exercise of their unfettered and independent judgement. As required under Listing Rule 3.3.2, the Board has determined that Peter Brook, Michael Smith, Andrew Evans, Chris Hunter and Jeff Morrison are considered to be independent directors under the NZX Listing Rules.
Board and Director Performance
The Board carries out a formal performance self-assessment each year under the direction of the Chairman. It involves reviewing the performance of the Board and its committees, together with setting goals and objectives for the Company for the upcoming year. The Chairman determines the process for assessing individual directors’ performance taking into account each director’s attendance, contribution and experience.
The current total directors' fee pool approved by ordinary resolution at the Company's 2017 Annual Meeting is $746,500 per annum.
Remuneration paid to directors by the Company during the year to 31 March 2018 were as follows:
|Michael Smith (Chair)||$171,841|
The Company considers it desirable to attract and retain high performing Directors whose skills and experience are well-suited to the Company's requirements. To this end, it is important that the Directors are remunerated appropriately. The Directors' fees are presently set as follows:
- Each Director (other than the Chairman) is paid $85,000.
- The Chairman is paid $160,000 per annum.
- Additional amounts are paid to committee members. The Audit Committee Chairman receives $20,000 per annum and its members receive $12,000 per annum. The Remuneration Committee Chairman receives $7,500 per annum and its members receive $5,000 per annum.
The performance of Directors is assessed by the Chairman, with the exception that the Chairman's performance is reviewed by the Chair of the Audit Committee. The Board takes advice from independent remuneration specialists when considering any proposal to increase the Directors' fees. Additional payments may be made to Directors who assume additional responsibilities (including in relation to one-off project work) from time to time beyond the scope of their usual responsibilities.
Insider Trading and Restricted Persons Trading
Directors, officers and employees, their families and related parties must comply with the Insider Trading Policy and the Restricted Persons Trading Policy. Amongst other requirements this identifies two ‘blackout periods’ each year where trading in the Company’s shares is prohibited:
• between 1 March until the day following the full year announcement date, and
• from 1 September until the day following the half year announcement date.
On-going fixed trading by participation in the Distribution Reinvestment Plan is available throughout the year. At all other times trading requires that an application is made and approval obtained from any two directors, or a director and the Chief Financial Officer.
Directors and Officers Indemnification and Insurance
We have arranged directors’ and officers’ liability insurance covering directors, senior executives and employees for their personal liability arising out of their duties. The insurer reimburses the Company where it has indemnified the directors.
Board committees assist with the execution of the Board’s responsibilities to shareholders. Each committee operates under a charter agreed by the Board, setting out its role, responsibilities, authority, relationship with the Board, reporting requirements, composition, structure and membership.
The Board has established a Remuneration Committee which considers the remuneration of the Directors and senior executives, and administers the Company's bonus scheme. The members of the Remuneration Committee are Michael Smith (Chairman), Peter Brook and Jeff Morrison.
The Board has established an Audit Committee, which is responsible for overseeing the financial and accounting responsibilities of the Company. The minimum number of members on the Audit Committee is three. All members must be directors, the majority must be independent directors and at least one member must have an accounting or financial background. The members of the Audit Committee are Mark Cross (Chairman), Michael Smith and Peter Brook.
The Audit Committee helps the Board fulfil its corporate governance and disclosure responsibilities with particular reference to financial matters, and internal and external audit. It is specifically responsible for:
- the appointment of Argosy’s external auditor
- supervising and monitoring external audit requirements
- reviewing annual and interim financial statements before they are submitted for Board approval
- reviewing the performance and independence of the external auditor, and
- monitoring compliance with the Financial Reporting Act 1993, Companies Act 1993 and the NZSX Listing Rules.
External Audit Firm Guidelines
The Audit Committee has developed a Charter of Audit Independence, which sets out the procedures that need to be followed to ensure the independence of the Company’s external auditor.
The Audit Committee is responsible for recommending the appointment of the external auditor and maintaining procedures for the rotation of the external audit engagement partner. Under the Audit Charter, the external audit engagement partner must be rotated every five years. The charter covers provision of non-audit services. The general principle here is that the external auditor should not be involved in producing financial information or preparing financial statements that might lead to the perception of their auditing their own work. It is however appropriate for the external auditor to provide due diligence services on proposed transactions and accounting policy advice.
Our communication strategy aims to ensure shareholders have all the information they need to assess the Company’s performance. It includes:
- periodic and continuous disclosure to NZX in accordance with the continuous disclosure requirements
- information provided to analysts and media
- annual and interim reports distributed to all shareholders
- the annual shareholders’ meeting and any other meetings called to obtain approval for actions as appropriate
- notices and explanatory memoranda for annual and special meetings
- newsletters and investor roadshows
- this website.
We invite shareholders to raise matters for discussion at annual and special meetings. As a shareholder, you will have the opportunity to question directors and the external auditor at these meetings.
Business Continuity Plan
We have comprehensive Business Continuity Plans (BCP) and Disaster Recovery Procedures in place. These are updated regularly in line with overseas trends and developments. This means we can maintain normal service in the event of a disaster or disruption. Daily data backups to secure off-site locations ensure our team has full access to any information or services they may require.
View the Constitution for Argosy Property Limited.