Governance report
Board’s performance was conducted in 2022 and the next review is scheduled for FY24. The Group Chief Executive is supported by the Vector executive team. Details of the members of the executive team are set out on pages 46 and 47 of this annual report and in the About Us section of Vector’s website (www.vector.co.nz/about-us/ board-executive-team). Members of the Vector executive team have access to the Board from time to time. Board membership Vector’s Board comprises experienced directors from diverse backgrounds and who govern the company on behalf of its shareholders and other stakeholders. The directors are committed to maintaining high standards of corporate governance, ensuring transparency and fairness and recognising the interests of our stakeholders. Vector’s Constitution and the NZX Rules set certain requirements in relation to the Board structure. The Board must have a minimum of three and a maximum of nine directors, with at least two being ordinarily resident in New Zealand. The Board currently comprises eight directors, all of whom are non- executive and ordinarily reside in New Zealand. Biographies are set out on pages 44 and 45 of this report and include information on the year of appointment, skills, experience and background of each director. The current directors possess an appropriate mix of skills, expertise and diversity to enable the Board to discharge its responsibilities and deliver the company’s strategic priorities, as illustrated in the skills and experience matrix below. The Board looks to strengthen its oversight of issues in all disciplines, as required, via expert advice.
To ensure that Vector’s business objectives and strategies are achieved and to deliver value to the company and its shareholders, the Board strives to understand, meet and appropriately balance the expectations of all its stakeholders, including its employees, customers and the wider community. In carrying out its responsibilities and powers, the Board at all times recognises its overriding responsibility to act honestly, fairly, diligently and in accordance with the law. The Board works to promote and maintain an environment within Vector that establishes these principles as basic guidelines for all of its employees and representatives. principally through its Board charter, which sets out (among other things) matters reserved for the Board and responsibilities delegated to the Group Chief Executive, and a formal delegation of authority framework. The effect of this framework is that, while the Board has statutory responsibility for the activities of the company, this is exercised through the delegation to the Group Chief Executive, who is accountable for the day-to-day leadership and management of the company. The framework also reserves certain matters for the decision of the Board. Vector achieves board and management accountability The Board charter sets out the expectation that all directors continuously educate themselves to ensure that they may appropriately and effectively perform their duties. The main functions of the Board include: – reviewing and approving the strategic, business and financial plans prepared by management;
– monitoring performance against the strategic, business and financial plans; – appointing, delegating to and reviewing the performance of the Group Chief Executive; – approving major investments and divestments; – ensuring ethical behaviour by the company, Board, management and employees; and – assessing its own effectiveness in carrying out its functions. A committee or individual director may engage separate independent professional advice in certain situations, at the expense of the company, subject to first obtaining the approval of the chair of the Board. The Board also has access to executives within the Vector group as a means of receiving assurance information. Each director has a duty to act in the best interests of the company and the directors are aware of their collective and individual responsibilities to stakeholders for the manner in which Vector’s affairs are managed, controlled and operated. The Board ensures that there is appropriate training available to all directors to enable them to remain current on how best to discharge their responsibilities and keep up to date on changes and trends in areas relevant to their work. The Board regularly assesses its effectiveness in carrying out its functions and responsibilities. The Board Chair leads the review and evaluation of the Board as a whole, and of the Board Committees, against their respective charters. The Board Chair also engages with individual directors to evaluate and discuss performance and professional development. An externally facilitated review of the
Board skills and experience This matrix shows the number of directors (out of eight) with these skills on a three-point scale (high / practical / limited).
Energy sector Next-generation customer experience Physical infrastructure Technology / digital / transformation Senior commercial leadership Health, safety and environment leadership Stakeholder engagement / insight Partnerships
Market insight NZ Market insight Aus Government and regulation
Financial expertise People and culture Governance (NZX) 0
1
2
3
4
5
6
7
8
High competence
Practical experience
Limited experience
35
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