The Director : The 2009 Corporate Governance Agenda; A New Year and a New Government. Mark Peart Talks to Minister of Commerce Simon Power to Get His Views on the Corporate Governance Agenda for 2009 and Then Canvasses Others for Their Agenda Items
Peart, Mark, New Zealand Management
Byline: Mark Peart
New Commerce Minister Simon Power has several priorities for advancing corporate governance in New Zealand in 2009, centred on reforms he believes will increase New Zealand businessCO opportunities to access capital.
A major focus will be the final report of the Capital Market Development Taskforce which is due in September. The taskforce is looking at the state of New ZealandCOs capital markets, the international context, future risks and opportunities and key changes necessary to deliver the best possible capital markets for New Zealand. Power said he expects the taskforce to be C[pounds sterling]innovative in their thinking and bold in their proposalsC[yen].
A review of the Securities Act and Securities Markets Act formed part of the work on the effectiveness of the capital markets.
C[pounds sterling]Neither is working as effectively as it should be,C[yen] Power said. C[pounds sterling]I will be announcing changes in 2009 that will improve investor confidence, particularly for mum and dad investors, and ensure that financial markets regulators are equipped to carry out their roles effectively.C[yen]
Power said his second area of corporate governance priority relates to financial reporting and the role of auditors and auditor regulation in promoting market confidence.
He also expects to announce decisions in relation to auditor regulation oversight.
C[pounds sterling]I will give a priority to dealing with the excessive financial reporting preparation requirements for small companies, the uncertainties for some reporting entities about their financial reporting obligations, and the inconsistencies across the financial reporting framework.C[yen] A discussion document will be released on the issue this year.
Power says he will make decisions on auditor liability issues.
C[pounds sterling]The accounting profession has been telling me there are problems with joint and several liability. I want to hear both sides of the story before making a decision,C[yen] he said, noting that there will be a discussion document on this matter in 2009.
Power said any reforms would be advanced consistent with the development of the New Zealand-Australia Single Economic Market objective.
C[pounds sterling]We will not be rushing in with a knee-jerk response to the global financial crisis. A good appreciation of what happened is starting to be developed. But knowing the C[pounds sterling]whatC[yen] is not enough. We need to know the C[pounds sterling]whyC[yen] before we decide what changes, if any, are required. We will also be monitoring how other governments respond.C[yen]
This is how the minister sees the priorities. What do others think? The Director took a sampling of expert opinions to find out.
GEOFF RICKETTS, chairman, Lion Nathan, QBE Chairman of the Year, Auckland
In my view, the corporate governance framework recommended by the NZX and other recipe books is more than adequate.
In the current recession, the focus should shift from conformance more to performance. While some regulation may be required in the finance sector, regulators need to be very careful about imposing additional costs on business.
In reality, it is businesses that pull the economy through. Business creates employment, pays the taxes to fund government and ultimately creates the nationCOs wealth.
Accordingly, Government needs to be focused on the right policy settings to ensure business can thrive, its costs are reduced, and crown costs as a percentage of GDP are reduced to be more in line with those of our major competitor nations.
Government needs to create an environment where the income gap between Australia and New Zealand can be narrowed and eventually closed. Otherwise, we will continue to lose our best and brightest across the Tasman.
New Zealand was …
Questia, a part of Gale, Cengage Learning. www.questia.com
Publication information: Article title: The Director : The 2009 Corporate Governance Agenda; A New Year and a New Government. Mark Peart Talks to Minister of Commerce Simon Power to Get His Views on the Corporate Governance Agenda for 2009 and Then Canvasses Others for Their Agenda Items. Contributors: Peart, Mark - Author. Magazine title: New Zealand Management. Publication date: February 2009. Page number: 62. © Not available. COPYRIGHT 2009 Gale Group.
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