Appointment policy hits GHL challenge
The director appointment process for Gisborne Holdings Ltd (GHL) that is now nearing completion shows the council remains unable to implement its Board Appointments and Remuneration Policy, in this the second appointment cycle for the supposedly Council-Controlled Trading Organisation since this policy was adopted in October 2018.
A key aim of the policy is board diversity, which GHL sorely lacks even as the council has transferred commercial assets to it that have diversified the company from solely a farming/forestry enterprise. Another is ensuring orderly three-yearly rotations and tenures limited to six years, or nine years in exceptional circumstances.
Three years ago Ming Pollard, GHL's sole female and non-Pakeha director, was appointed and Peter Reeves was reappointed, having first joined GHL in November 2009.Following council policy, both should be retiring and with Mr Reeves unable to seek reappointment.
Instead it is the GHL chairman Rob Telfer, appointed to that role in March 2018 — and seemingly not reappointed as a director since he joined the board in October 2014 — who has retired and put himself forward for reappointment.
In answer to questions from The Herald, GDC chief executive Nedine Thatcher Swann said 'issues have been identified with the appointment term of two current directors'.
'Some directors were appointed before the adoption of the current policy and we are working to understand the implications of this.'
The council would consider options for how to resolve this matter at the beginning of next year, she said.
Regarding Mr Telfer's retirement, Ms Thatcher Swann said the council had received formal notification from GHL that he was retiring as per section 7.5 of the GHL constitution.
While the council's policy says it includes GHL's appointment provisions, there is a significant difference: the GHL constitution says 'one-third (rounded down to the nearest whole number) of the directors shall retire each year', while the council policy says 'approximately one-third' of the board is rotated each year.
While it has five members as at present, GHL can only rotate one director a year under its constitution. So if the council has a high-quality candidate who meets its diversity requirements, it should start the process of aligning with its own policy by appointing them as well as reappointing the chairman.
A generous $200,000 total fees pool for the GHL directors should not need to be lifted either.