Board Charter

Approved by the Board: March 2018

Board Charter 2018-06-11T14:11:17+00:00

Definitions

  • “Board” means the Board of Directors of the Company
  • “AWF Madison” or “Company” means AWF Madison Group Limited
  • “Management” means the senior executives of the Company

 

Introduction

The Company is a holding company whose subsidiaries provide semi-skilled and skilled staff to all manner of industry in New Zealand, on both short and long term assignments. AWF Madison contracts or employs both temporary and full time, permanent staff for placement. Its ordinary shares are listed on NZX.

This Charter formalises and sets out the approach, role and responsibilities, composition, structure and procedures of the Board. This Charter provides guidance for the effective oversight of the Company by the Board on behalf of its shareholders, employees and other material stakeholders.

The term “corporate governance” is generally understood to mean the oversight of the business by the Directors and the accountability of the Directors to shareholders and other stakeholders, for the performance of the Company and compliance by the Company with laws and standards. This Charter has been established to promote a culture that ensures commitment to and compliance with good corporate governance principles and ethical conduct is at the heart of the Company’s business practices. The Company will continue to monitor developments in corporate governance practices and update its policies to ensure AWF Madison maintains appropriate standards of governance.

This Charter should be read in conjunction with the Constitution and the Company’s other governance documents. The Company must also comply with NZSX Listing Rules and applicable New Zealand legislation.

 

Approach

The Board’s role is to effectively represent and promote the interests of shareholders with the objective of adding long-term value to the Company’s shares by directing and supervising the Management of the business and the affairs of the Company.

Open and constructive discussion is encouraged at all Board and Committee meetings. Each director is expected to fully participate in meeting discussions.

 

Role and Responsibilities of the Board

The Board

The Board is responsible for the corporate governance of the Company and is the final body of responsibility for all decision-making within the Company. The Directors govern AWF Madison in the shareholders’ interests working with, and through, the Chief Executive.

The Board has adopted the following governance objectives in order to assist it to achieve its role:

  • Lay solid foundations for management and oversight of the Company.
  • Ensure that, through its skills mix and composition, it is positioned to add value;
  • Promote ethical and responsible decision-making;
  • Safeguard integrity in its financial reporting;
  • Make timely and balanced disclosure;
  • Respect the rights of all shareholders;
  • Recognise and manage risk;
  • Encourage enhanced performance;
  • Promote a corporate culture that embraces diversity and inclusiveness.

The Board has legal responsibility for the affairs and activities of the Company. It establishes the Group’s objectives, major strategies for achieving these objectives, the overall policy framework within which the business of the Group is conducted, and monitors management performance with respect to these matters.

The Board’s specific responsibilities include:

  • Providing strategic direction and monitoring strategy implementation and performance;
  • Reviewing and approving business plans and budgets and monitoring performance against targets;
  • Ensuring adequate resources are available to senior executives;
  • Monitoring management of capital;
  • Monitoring the operational and financial position and performance of the Company;
  • Ensuring that effective audit, risk management, and compliance systems are in place and monitored to protect the Company’s assets and to ensure the Company operates within acceptable risk and reporting parameters as determined by the Board and in compliance with all legal and regulatory requirements;
  • Monitoring financial performance and the integrity of reporting including annually receiving certification from the Chief Executive and Chief Financial Officer that the Company’s financial reports represent a true and fair view in all material respects of its financial condition and operational results and are in accordance with relevant accounting standards;
  • Appointing (and, where appropriate, removing) the Chief Executive, approving senior executive appointments and remuneration packages, and monitoring performance against established objectives;
  • Setting, and regularly reviewing delegated authority levels for the Chief Executive and senior executives to commit to new expenditure, enter contracts, or acquire businesses;
  • Approving transactions above Delegations Policy limits;
  • Establishing appropriate procedures to ensure effective and timely reporting to the Board and to the Company’s shareholders;
  • Adopting appropriate policies and procedures to ensure compliance with all laws, regulations, NZX Listing Rules and other relevant provisions;
  • Approving and reviewing key internal policies and procedures including governance documents;
  • Setting the Company’s dividend policy;
  • Reviewing succession and development plans for the Chief Executive and senior executive team.

The Board will, at least annually:

  • Review and approve the Company’s strategic plan;
  • Review the operational plans and budget for achieving the strategic plan;
  • Review the Company’s major policies;
  • Approve the interim and annual financial statements and reports;
  • Review the Board composition, structure and succession;
  • Review Board Committee composition and performance;
  • Review Board and Committee charters and other governance documents;
  • Undertake Board and individual Director performance evaluations and review Directors’ remuneration;
  • Review the performance and remuneration of the Chief Executive and receive and consider the Chief Executive’s reports on senior staff performance;
  • Consider the Board’s work plan for the following 12 months

 

Chief Executive

The Chief Executive is responsible for implementing a culture and driving performance that supports the Board’s approach to governance, the development and achievement of business strategies and building trust in the Company.

The Board will act as an advisor and coach to the Chief Executive as required. The Board will constructively challenge as part of overseeing and monitoring the work and performance of the Chief Executive and the senior staff.

 

Composition

The Board will be structured to ensure that, collectively; it can fulfil its role and meet its responsibilities. The Board will comprise a minimum of three and a maximum of seven members. Board composition, Director rotation and independence will be in accordance with the Company’s Constitution and NZX Listing Rules.

The Board will comprise of a majority of independent Directors, a majority of who will be ordinarily resident in New Zealand. All Directors are elected by the shareholders. The Board’s standards for determining independence will be based on the NZX requirements and require an affirmative determination that a Director does not have a disqualifying relationship other than solely as a consequence of being a Director. The Board through the Nominations Committee will assess the independence of Directors on their appointment and at least annually thereafter. Each Director will fully disclose to the Board all information necessary to enable AWF Madison to ensure compliance with these requirements.

There is no maximum term for which a person can remain a Director.

The Board will receive recommendations from the Nominations Committee regarding the composition of the Board and candidates for appointment to the Board.

 

Structure

A Chairperson of the Board of the Company will be appointed from among the independent Directors or otherwise as agreed by a majority of duly appointed Board members. A Director shall not simultaneously hold the position of Chief Executive of the Company and Chairperson of the Board.

The Chairperson’s role is to provide leadership to the Board, to manage the Board effectively and to interface with the Chief Executive. The Chairperson is also responsible for representing the Board to shareholders. The Chairperson will meet with the Chief Executive prior to each Board meeting to discuss the agenda. The Chairperson will also consult promptly with other Directors over any matter about which the Board should be aware. The Chairperson will chair all meetings of the Board at which he/she is present and will chair the Annual Shareholders’ Meeting.

The Board may appoint a Managing Director. The Company’s Constitution requires that the Managing Director’s appointment be for a maximum term of 5 years. The Board may reappoint a Managing Director for a successive term/s.

The Company Secretary is responsible for the co-ordination of all Board business including meeting scheduling, agendas, distribution of Board papers, minutes, statutory filings, market disclosures and other communication with stock exchanges and regulatory bodies.

The Board may establish committees to assist it in carrying out its responsibilities. Committee chairs and members will be appointed by the Board. Each committee shall adopt a formal charter to be approved by the Board, setting out the functions and responsibilities relating to that Committee. Each charter will be reviewed annually by the Committee and the Board. The Board will ensure that each Committee has access to adequate resources (both internally and externally) to allow the Committee to perform its functions effectively and efficiently.

The Board Committees are Audit, Finance and Risk Committee, Health and Safety Committee, Nominations Committee and Remuneration Committee. The Board may from time to time establish other ad hoc committees.

The objective of the Audit, Finance and Risk Committee is to provide independent assurance and assistance to the Board and Chief Executive on the entity’s risk, control and compliance framework and its external financial reporting and accountability responsibilities.

The objective of the Health and Safety Committee is to take an active role to ensure compliance with all legislative and regulatory requirements in relation to the health and safety practices of the Company as those activities affect employees and contractors.

The objective of the Nominations Committee is to assist the Board with an annual evaluation of the Board, Chairperson and Director performance, determine Director independence and to identify and recommend to the Board individuals for nomination as members of the Board and its Committees.

The objective of the Remuneration Committee is to establish remuneration policies and practices that attract, retain and motivate Directors and senior executives. The Committee ensures that executives and Directors are rewarded having regard to the Group’s performance.

Non-executive Directors are entitled to rely on information provided by AWF Madison executives in relation to matters within their responsibility and area of expertise and may assume the accuracy of information provided by such persons so long as the Director is not aware of any reasonable grounds upon which such reliance or assumption may be inappropriate.

The Board may rely upon information provided by Board Committees and their members in relation to matters within that Board Committee’s delegated responsibility, provided that it has evaluated the information and is not aware of any reasonable basis upon which to question its accuracy.

 

Procedures

Proceedings of the Board and Committee meetings will be in accordance with the Company’s Constitution, any relevant Committee Charter and otherwise as determined by the Chair of the Board or relevant Board Committee. The Chairperson is responsible, in consultation with the Chief Executive and Company Secretary, for the conduct of all Board meetings. The agenda for each Board meeting will be determined by the Chairperson in consultation with the Chief Executive and the Company Secretary, with each Director being encouraged to suggest agenda items.

The standing items for each full meeting will include:

  • Approval of minutes of the previous meeting
  • Matters arising from the previous meeting
  • Updating of the register of Directors’ interests
  • A report from the Chief Executive
  • A report from the Chief Financial Officer
  • Specific papers or proposals requiring Board approval as required by the Delegations Policy
  • Matters requiring public disclosure

The Board will normally meet at least 11 times each year and will meet at other times as required. Written notice of Board meeting dates, times and locations will be prepared by the Company Secretary. Any Director, or the Company Secretary at the request of a Director, may convene a meeting of the Board by giving the required written notice.

The Board shall, on an annual basis, schedule a Strategic Update Day, where Board and Management will discuss and review the current performance of and future direction of the Company.

Directors will receive material at least five days in advance of the meeting to enable appropriate time for review unless a matter of urgency is to be considered.

Minutes will be taken of all Board and Committee meetings. All discussions and the record of the meeting will remain confidential unless there is a specific direction from the Board or disclosure is required by law.

The Board may meet without management present to consider Company matters. The Chairperson may require any Director or other attendee to leave a meeting at any time.

Members of staff may be invited to attend Board meetings.

Implementation of programmes to achieve the Company’s strategic objectives and management of day to day operations is delegated to the Chief Executive. It is expected that the Chief Executive will further delegate a number of functions to senior members of staff. Any matters outside those approved delegations must be referred to the Board for approval. Those staff making decisions under a delegated authority are authorised to exercise appropriate and informed decision making within a controlled, accountable and transparent framework, with reference to budgets, compliance with the law and the objectives of AWF Madison. The delegation of authority levels shall be reviewed annually by the Chief Executive and reported to the Board for confirmation or amendment.

 

Directors Responsibilities

Directors are expected to comply with their legal duties and obligations when discharging their responsibilities as Directors and, in addition, exercise high standards of honesty and ethical behaviour.

New Directors will receive a letter of appointment setting out the key terms and conditions of their appointment.

The Chairperson shall meet regularly with Directors to discuss individual performance. The Board will review and evaluate the performance of the Board, individual Directors and Committees annually utilising a Board evaluation process established, developed and overseen by the Nominations Committee.

All Directors are encouraged to undertake appropriate training and continuing education so that they may best perform their duties. All Directors are expected to keep themselves up-to- date on relevant industry and company-related issues and trends in governance and business practices.

Information of sufficient content, quality and timeliness as the Board considers necessary to effectively discharge its duties, should be provided to Board by management. Directors may access company information and seek, with the Chairperson’s approval, independent advice as they individually or collectively consider necessary to fulfil their responsibilities and allow independent judgement in decision making. Directors may have access to internal and external auditors without management present. Directors are entitled to have access to members of the staff via the Chief Executive at any time to request relevant additional information or seek explanations.

Directors must disclose to the Company any actual or potential conflicts of interest which may exist or be thought to exist as soon as they become aware of the issue. Directors should take any necessary and reasonable measures to try to resolve the conflict. Where conflicts of interest exist Directors must excuse themselves from discussions in respect of those interests and may not exercise their right to vote in respect of such matters.

An Interests Register will be maintained by the Company Secretary. Entries in the Interests Register including actual or potential interests in a matter must be disclosed to the Board.

All non-executive Directors are encouraged to hold AWF Madison shares. Directors are subject to limitations on their ability to buy and sell AWF Madison shares by the Company’s Share Trading Policy and the Insider Trading Provisions of the Financial Markets Conduct Act 2013. These limitations include the requirement that Directors cannot buy and sell AWF Madison shares during the black-out periods from thirty (30) days from the date of the announcement to the Market of the Company’s Interim (Half-Year) financial results; and six (6) weeks from the date of the announcement to the Market of the Company’s full year (Annual) results. All trading is subject to prior approval of the Chairperson or in the Chairperson’s case by the Chairperson of the Audit and Risk Management Committee – and in compliance with the Company’s Share Transaction Policy and the procedures therein. All changes in the shareholdings of Directors are reported to the Board and the NZX. Directors shall note and acknowledge their understanding of the AWF Madison Group Policy on Share Transactions.

The Board will seeks to ensure that new Directors are appropriately introduced to management and the business; are acquainted with relevant industry knowledge; and receive all appropriate papers, policies and documents to enable them to effectively perform their role and add value to the Company.

 

Director Remuneration

Director remuneration is paid in the form of Directors’ fees. Additional fees may be paid to the Chairperson, deputy Chairperson, Committee Chairs and Committee members to reflect additional Board responsibilities where first approved by the board. The total fee pool available to be paid to Directors is subject to shareholder approval.

Non-executive Directors are entitled to reimbursement of reasonable expenses associated with undertaking their duties as a Director. All Directors’ expense reimbursements are approved by the Chairperson. The Chairperson’s expenses are approved by the Chairperson of the Audit, Finance and Risk Committee. No retirement allowances are payable to Directors. The Chief Executive’s expenses claims are approved by the Chairperson of the Board.

The Chief Executive’s remuneration is paid in the form of a salary and may also include entitlement to participate in Company Bonus or incentive schemes, subject to any necessary shareholder approval requirements.

 

Approval and Review

This Charter has been approved by the Board and will be reviewed annually and as required to ensure that the Charter remains consistent with the Board’s objectives and responsibilities.