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Counsel and Company Secretary prior to any transactions involving Fletcher Building securities. In addition, through our share registry, Computershare Investor Services Limited (Computershare), we actively monitor trading in Fletcher Building shares by our personnel. Principle 2 – Board Composition and Performance “To ensure an effective board, there should be a balance of independence, skills, knowledge, experience and perspectives.” Board’s roles and responsibilities The role of the board is to provide overall strategic guidance and effective oversight of management for the purposes of protecting and enhancing the value of Fletcher Building assets in the best interests of the Company. The board has statutory responsibility for the affairs and activities of the Company, which in practice is achieved through delegation to the chief executive officer who is charged with the day-to-day leadership and management of the Company. The board’s roles and responsibilities are formalised in a board charter, which is available on the Company’s website. The board charter sets out those functions that are delegated to management and those that are reserved for the board. Under the board charter, the Group General Counsel and Company Secretary is secretary to the board and accountable directly to the board, through the chairman, on all matters to do with the proper functioning of the board. Nomination and appointment of directors Procedures for the appointment and removal of directors are governed by the Company’s constitution. The Nominations Committee makes recommendations to the board in respect of board and committee composition and, when required, identifies individuals believed to be qualified to become board members. Before a person is appointed to the board, checks as to the person’s character, experience, education, criminal record and bankruptcy history are conducted. Each director receives a letter formalising their appointment. That letter outlines the key terms and conditions of their appointment, including Fletcher Building’s expectations for the role of director, and is required to be countersigned confirming agreement. Director independence The Company acknowledges the importance of having independent directors, ensuring it has the correct balance of skills to optimise the financial performance of the Company and maximise returns to shareholders. The test of “independence” is governed by the requirements of the NZX Listing Rules. The board currently comprises of six directors, with a wide range of skills and experience. The qualifications and experience of each of the directors, including length of service, is set out in “Our Board” section on pages 12 and 13. Directors are required to inform the board of all relevant information which may affect their independence, and the board confirms the independence status of its members annually. The board considers all the current directors as at 30 June 2018 to be independent. The Company follows recommendations that the chairman be an independent director who is not the same person as the chief executive officer and that a majority of the board are independent directors. In addition, the chairman of the Audit and Risk Committee is not the chairman of the board, and under its charter all members of this committee must be non-executive and independent directors. Diversity Policy Fletcher Building has a Diversity Policy, which is available on the Company’s website. The Remuneration Committee reviews progress against diversity initiatives developed by the Company to deliver outcomes against the Policy. Further information on diversity initiatives can be found in “Our People” section on pages 38 to 41. The board is satisfied with the initiatives being implemented by the Company and its performance with respect to the Diversity Policy. The policy does not currently include a requirement for the board (or a committee) to set measurable objectives for achieving diversity (as is recommended by the NZX Corporate Governance Code), as the board has considered diversity outcomes can be achieved without measurable objectives. However, the policy does require the Company to regularly benchmark the Company’s diversity standpoint, status and objectives against appropriate external comparators – which we have done in relation to key target areas. Following the restructuring of the Company’s operational divisions undertaken during the past financial year, the board will review and adopt a new Diversity Policy during the 2019 calendar year for implementation as part of the new strategic settings, which will include measurable objectives for achieving further diversity. The numbers and proportion of women and men within Fletcher Building as at 30 June 2018 are set out in the table below. 2018 2017 Women Men Women Men Board of directors 1 (17%) 5 (83%) 2 (22%) 7 (78%) Executive committee 3 (27%) 8 (73%) 2 (20%) 8 (80%) Senior management¹ 15 (25%) 46 (75%) 16 (26%) 45 (74%) All employees 22% 78% 22% 78%
1 Senior management for these purposes includes any person who reports to a member of the executive committee.
111 Fletcher Building Limited Annual Report 2018
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