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FAQ About Boards and AppointmentsThe following are some common questions and answers on boards and the appointment process.
Q. Who can apply to become a director? As long as you consider that you have the appropriate skills and experience, you are encouraged to apply. We welcome applications from people of all walks of life. Q. Are there any restrictions on age, gender, location etc? No. Q. Is there a quota for directors based on gender, ethnic origin, and other demographic factors? No. Although it is the Government’s wish that Crown company boards reflect the population as a whole, the ‘best qualified’ person is appointed regardless of factors such as gender or ethnic origin. Q. What skills and experience do I need? There is no exclusive person specification for Crown company directors. The skills and experience required will depend on the nature of each company’s business and the skills and experience of existing directors. A combination of specific skills is always sought to ensure that boards have a range of skills covering, for example, financial management, international business, governance, and knowledge of the particular sector in which the company operates. When a director with specific skills reaches the end of his or her term, often the replacement director sought will be required to have similar skills (unless the focus of the company’s activities has changed and different skills are required). In general terms, we look for people with a certain level of underlying skills such as financial literacy, good communication, strategic awareness, and an ability to take a wide perspective of issues. Q. Do I already need governance experience? No. You do not require experience as a director in the private or public sector. Over the years, the Government has appointed many first-time directors to Crown company positions. However, governance or senior executive experience is more likely to see a candidate short-listed, regardless of whether that experience is in the commercial, government, or not-for profit sectors. Q. Do I have to be a member of the Institute of Directors? No. Q. Am I eligible to become a director if I already work for a Crown company or in the public service? If you already work for a Crown company, you generally cannot be appointed to the board of that company. However, the company may wish to appoint you to the board of one of its subsidiaries (shareholding Ministers are not involved in subsidiary board appointments). If you work for one Crown company, the only restriction on your appointment to the board of another Crown company would be any potential conflict of interest (see below). Public servants from core government departments are generally not eligible for consideration. Contact us if you would like to check whether you are eligible or not. Q. Am I still eligible if I live overseas or outside of the main centres? Yes. Your place of residence is generally not an issue as long as you can make yourself available to attend regular board meetings. Board meetings generally occur at each company’s registered office, although meetings can also be scheduled in other centres where the company has a significant presence to give board members first-hand knowledge of the company’s operations. Your reasonable expenses relating to travel and accommodation on board business will be reimbursed. Overseas appointments will be considered if there is a specific company need for a director residing in a particular country or if no director candidates with the appropriate skills are resident in New Zealand. Q. Are there any reasons that may prevent me from becoming a Crown company director? Section 151(2) of the Companies Act 1993 outlines reasons that disqualify a person from becoming a company director. Those reasons apply also to Crown companies. Some conflicts of interest may also render candidates ineligible to serve on particular boards. Q. Can I apply if there is a conflict of interest? Generally, if you face a current or potential, known or perceived conflict of interest, you may be ineligible to become a Crown company director on a specific board. A conflict of interest is likely to occur if you have a personal or business interest that is in common, or could be perceived to be in common, with the operations of the company for which you wish to be considered as a director. Examples of situations that can lead to conflicts include:
Q. Realistically, what are my chances of being appointed to a Crown company board? The Crown appoints approximately 40 new directors each year. CCMAU currently has a database of 3,000 people who have shown interest in becoming a director, and several hundred new expressions of interest are received every year. Consequently, it is important to be realistic about your chances of becoming a director. However, as long as you have the right skills and experience, you have the same chance as anyone else on CCMAU’s database. There is no “first come, first served” system. In addition, CCMAU maintains close links with other agencies responsible for appointing directors, and many opportunities to be considered for appointment arise through that process. Q. What time commitment is involved? Being a Crown company director is not a full-time job. Generally you would be required to spend two to three days a month, of which one day would be spent attending a board meeting. The other day(s) could be spent on subcommittee work or in preparation for board meetings. Q. How long do directors serve? Directors are appointed for an initial term of three years and in some cases their term is extended for another three years. It is rare for directors to serve for more than six years. Q. What will I get out of being a director? Being appointed by Cabinet as a Crown company director is, in itself, a significant honour. As there are many applicants for generally few vacancies, should you be appointed, you can rightly consider that Cabinet views you as an outstanding candidate. In terms of the Companies Act 1993, once appointed you serve the best interests of that company. You can expect that to be both personally rewarding and challenging. The Crown companies operate in diverse domestic and international markets, and face the same risks and opportunities as their private sector counterparts. Q. Will I be paid as a director? Yes. Director fees are paid by the company out of annual amounts approved by shareholding Ministers. Actual amounts paid vary depending on the scale and complexity of the company, from $16,000 to $32,000 per annum. Chairs and deputy chairs receive an additional loading. Cabinet reviews fee levels bi-annually. Q. Are my expenses reimbursed? Yes. You will be reimbursed for reasonable expenses involved in travel and accommodation for board meetings and on other board business. When you join the board, check with the chair regarding allowable expenditure levels and reimbursement arrangements. There are specific guidelines for the reimbursement of director fees. Q. How can I find out about director vacancies? We do not generally advertise in the media, although we do list details of appointments under consideration on our website once we are ready to call for nominations. This generally occurs quarterly, and the website will note when the next tranche of appointments will be listed. Once you have registered with CCMAU, your details are automatically taken into account against the requirements of each position that arises. Q. How do I apply to become a director? Simply, send us your CV and we will take it from there. We will enter your CV on our database and consider your application for any current or future director vacancies. It is important to send us your updated CV if there is any change in important information such as your employment status, address, other directorships etc. We prefer that you send us your CV by e-mail. Click here for contact details. After you send us your application, you will be contacted within a few months and invited to attend a screening interview, normally in or close to your home town. CCMAU and an experienced Crown company director will interview you. The objective of this meeting is to discuss your particular areas of interest and expertise and to provide an initial induction into directing a Crown company. Later, when a vacancy arises, we will check our database for candidates with the right skills and experience. We also advertise vacancies on our website and may advertise in the main newspapers. We will also consult with other government departments, Ministers’ offices, existing directors and others for suggested names. If we believe that you have the right skills and experience for the specific vacancy, CCMAU will propose you and other potential candidates to shareholding Ministers. If shareholding Ministers decide to offer you a directorship, you will be given the opportunity to get to know the company and other board members better. The chair of the company will also check that there are no known or potential conflicts of interest. Once you confirm that you accept an offer if one is made to you, shareholding Ministers will seek Cabinet approval for your appointment. Q. Before I start, how do I learn about the company? CCMAU will organise a new director induction seminar in which we will discuss the role and responsibilities of directors and some general issues affecting Crown companies. The company itself will arrange a specific induction programme for you and it is very likely that you will have a number of meetings with the chair before your first board meeting. However, it is important that you make every effort to become familiar, in as short a time possible, with the company in which you will serve as a director. Q. How long will the process take? If you send in your CV for a specific vacancy that you have seen advertised, we will let you know as soon as possible after the closing date. The process for each board can take up to six months to complete. If you send us your CV in anticipation of future vacancies, we will maintain your details on our database and contact you if Ministers wish to short-list you for a vacancy. If you do not hear from us, don’t worry. We will not delete your details from our system and will continue to consider your application unless you advise us otherwise. Q. Can I apply to become a director at any time of the year? Yes. You can send us your CV at any time and we will consider it for any vacancies at the time or, otherwise, enter your details on our database. As soon as a future vacancy arises, we will consider your CV along with everyone else. We do not consider applications on a “first come, first served” basis. Q. What is the role of CCMAU in appointing directors? CCMAU manages the process and makes recommendations to Ministers. It is up to Ministers to accept or reject CCMAU’s recommendations and, if necessary, to ask CCMAU to consider other applicants. Ministers make the appointments. Q. Can I apply for Crown company positions through other government departments? Yes. CCMAU maintains a close working relationship with other government departments that regularly forward CVs to CCMAU. These nominating agencies are (all links open in a new window):
CCMAU also automatically consults these departments when vacancies arise. If you are interested in becoming a Crown company director, you should ensure that your details are held by both CCMAU and any of the applicable nominating agencies. CCMAU also receives information on potential directors from Ministers, Members of Parliament and other Crown company directors. Q. How do I apply for positions on other government boards and entities? CCMAU advises Ministers on appointments to Crown company boards. These companies include Crown research institutes, state-owned enterprises, Crown-owned companies and some Crown Entities. We maintain a close working relationship with other appointing agencies, and share candidate information where applicable (and authorised by candidates) There are over 500 companies, trusts, advisory boards, and other entities to which the Crown makes appointments. The principal appointing agencies are (all links open in a new window):
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