corporate governance
PROMOTING A COMPANY CULTURE WHICH EMBRACES DIVERSITY AND INCLUSION Vector is committed to: • Adding to, nurturing and developing the collective relevant skills, and diverse experience and attributes of Vector people • Ensuring that Vector’s culture and management systems are aligned with and promote the attainment of diversity and inclusion • Providing an environment in which all people are treated with fairness and respect, and have equal opportunities available at work • Being recognised as an organisation that exemplifies diversity and inclusion in action. LAYING SOLID FOUNDATIONS FOR MANAGEMENT Vector’s governance practices are designed to: • Enable the board to provide strategic guidance for the company and effective oversight of management • Clarify the roles and responsibilities of Vector’s directors and senior executives in order to facilitate board and management accountability to both the company and our shareholders • Ensure a balance of authority so that no single individual has unfettered powers. 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's primary objective is to protect and enhance the value of the company while acting in the interests of the company and our shareholders and, in that context, to have due regard to the interests of other stakeholders. The Board exercises this obligation through the approval of appropriate corporate strategies, practices and processes. These include the approval of transactions and commitments not within the authorities delegated by the Board to management and the review of company performance against strategic objectives. Vector achieves board and management accountability through its board charter, which sets out (amongst 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, whilst the board has statutory responsibility for the activities of the company, this is exercised through the delegation to the Group Chief Executive, who is responsible for the day-to-day leadership and management of the company. The framework also reserves certain matters for the decision of the Board. The board charter also sets out the expectation that all directors continuously educate themselves to ensure that they may appropriately and effectively perform their duties.
STRUCTURING THE BOARD TO ADD VALUE Vector’s Board is composed of a minimum of three and a maximum of nine directors, with at least two being ordinarily resident in New Zealand. As at 30 June 2018, the Board comprised eight directors, all of whom are non-executive directors. Information on the skills, experience and expertise of each director and their independence status is set out in the ‘Board of Directors’ section on page 52. The Board considers all directors to be independent with the exception of James Carmichael and Karen Sherry who are not independent directors as they are also trustees of Entrust, Vector’s majority shareholder. Only independent directors are eligible to be the Board Chairman. Directors are required to inform the Board of all relevant information which may affect their independence. The Board has a formal board charter detailing the board’s purpose, responsibilities, composition and operation, which is published on Vector’s website. A committee or individual director may engage separate independent professional advice in certain situations, at the expense of the company, with the The Board takes an active role in preparing the Annual Report, including the financial statements that comply with generally accepted accounting practice. The Board contributes to and reviews all aspects of the Annual Report. The Audit Committee is responsible for financial reporting integrity, which includes reviewing financial statements, reviewing external financial reporting, assessing the fairness of financial statements, submitting group financial statements to the board for approval, and considering and approving the Chairman’s and Group Chief Executive’s reports for the Annual Report. The Board approves the Annual Report, including the financial statements, following the recommendation to do so from the Audit Committee. AUDITORS Vector’s external auditors for the year ending 30 June 2018 were KPMG. The Board, after considering the recommendations of the Audit Committee, consider and review the appointment of external auditors. The Board requires the rotation of the audit partner for the statutory audit after no more than five years. The Audit Committee provides a formal forum for communication between the Board and the external auditors, ensures the independence of the external auditors, has oversight of audit planning, reviews and recommends audit fees, considers audit opinions and evaluates the performance of the external auditors. No issues concerning the external auditors’ independence have been identified. approval of the Chairman of the Board. PREPARATION OF ANNUAL REPORT
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