| Corporate Governance |
1. IntroductionPostie Plus Limited (‘PPGL’) is listed on the New Zealand Stock Exchange (NZX) and accordingly it has a Code of Governance that meets the material provisions of the NZX Corporate Governance Best Practice Code, as set out in Appendix 16 to the NZX Listing Rules. The Code includes guidance on moral, ethical and professional responsibilities. It applies to both Executive and Non-Executive directors.Shareholder Communications Policy
2. Code of GovernanceAll Board members and executives of the company are required to confirm in writing their understanding and commitment to the company’s Code of Governance. Throughout the year ending 2 August 2009 and in previous years, the Board is committed to adhere to the Code of Governance and considers it has been drafted in a manner consistent with the standards set out in the NZX Guidelines. This section of the Annual Report provides relevant details on PPGL’s corporate governance practices.The Code of Governance states the principles on which it is based, including: • Integrity and accountability, such qualities being essential to maintaining confidence and trust in the Directors. • The need to promote the company’s performance without prejudicing its compliance obligations. • The need to ensure long term objectives are not compromised by the short term expectations of shareholders and analysts. The PPGL Code of Governance has the following provisions: - No share options issued to Directors or Senior Executives. - No loans provided to Directors of Senior Executives. - Auditors to provide no other services to the business, unless approved by the Audit Committee. - Auditors to be one of the largest six audit firms in New Zealand. - Audit Committee to comprise at least two non-executive Directors and to be chaired by one of the non-executive Directors. - Auditors to be replaced at least every seven years and the same Audit Partner cannot be responsible for the audit for more than four years. - The company will not employ persons from its Auditors in any senior position, unless their employment with that Audit firm had ceased at least two years earlier. - All board sub-committees will be chaired by a non-executive Director. - The Chairman must be a non-executive Director. - The number of non-executive Directors must exceed or equal the number of executive Directors. - There must be a minimum of two executive Directors to ensure the Managing Director does not have a monopoly on executive input into Board consideration. - The minimum number of Directories is five. - A new Director must be appointed every five years. - The Board will ordinarily meet eleven times per year. - Executive Directors will be paid modest Director fees to ensure they differentiate between their Board and executive responsibilities. - A minimum of 25% of the Managing Director’s total remuneration must be dependent on the company achieving budgeted profit. - No retiring allowances to Directors without shareholder approval. - Formal individual Director and Board evaluations to be conducted annually. The Code, and the Ethics Policy (see below) incorporated in the Code, sets out paramount obligations to be complied with by Directors: • Acting with integrity and in the best interests of the company. • Treating all shareholders fairly. • Meeting legal obligations, including their fiduciary duties. • Avoiding conflicts of interest and dealing with any that may arise in a lawful way and in accordance with the company’s Constitution. • Being diligent and attending to the company’s business issues in a timely way. • Maintaining confidentiality and dealing with confidential information only as authorised by the Board. • Trading in the company’s shares only in accordance with the stated policy on share dealings. 3. Ethics PolicyThe Board has implemented an Ethics Policy to provide guidance to its executives and other employees on how it expects them to conduct themselves when undertaking business on behalf of the company, including the avoidance of conflicts of interest, breaches of confidentiality and the wrongful use of company assets including the company’s internal information. The Ethics Policy is based on the values of: Integrity, Honesty and Respect.These values are integral to PPGL’s inter-relationship with its suppliers, staff, customers and stakeholders. The Ethics Policy is a foundation for our legal compliance with the Fair Trading Act, Health & Safety regulations in the workplace, employment and equal opportunity law, financial management and securities law. The Ethics Policy will be accessible to all employees and the Board will monitor adherence to the Policy with accountability for unethical behaviour at any level. The Board has implemented a ‘Whistleblower” Policy to provide guidance and assistance to employees who may wish to disclose information that relates to a ‘serious wrongdoing’ in the workplace. 4. Role of the BoardThe role of the Board is to effectively represent and promote the interests of the shareholders with a view to providing a return (dividend) on their investment and adding long-term value to the Company’s shares.The Board is responsible for the proper direction and control of the Company’s activities. This responsibility includes such areas of stewardship as the identification and control of the Company’s business risks, the integrity of management information systems and reporting to shareholders. In making decisions the Board shall consider whether: • There are any conflicts of interest; • All relevant facts reasonably available have been provided to the Board; • The decision is in the best interest of the Company; • The decision is socially responsible; • The decision complies with the Code and the Ethics Policy. In addition to Committee responsibilities (below), individual board members work directly with management in strategic initiatives. The Board meets monthly except in December. Committees meet regularly and as appropriate through the year. 5. Role of Senior ManagementThe Board has delegated to the Managing Director responsibility for the day-to-day management of the company, while maintaining overall responsibility for the control framework of the business. The Managing Director is also the Chief Executive Officer and thus part of a senior management team of nine executives. The performance of senior executives is reviewed periodically by the Managing Director against appropriate measures set by the Managing Director.6. Board MembershipThe Board comprises both executive and non-executive directors, with at least 50% required to be non-executive directors. At the time of signing the Annual Report, the Board consisted of four non-executives and one executive director. In recognition of the importance of independent views and the Board’s role in supervising the activities of management, non-executive Directors chair the Board and all Board sub-committees.The constitution of the Company requires at least one-third of the Directors or, if their number is not a multiple of three, then the number nearest to one-third, shall retire from office at the annual meeting each year, but shall be eligible for re-election at that meeting. The Code of Governance sets out the following requirements in relation to Board membership: • The Chairman must be a Non-Executive Director; • The number of Non-Executive Directors must exceed or equal the number of Executive Directors; • Ordinarily there should be not less than two Executive Directors; • Ordinarily a new Director must be appointed every five years. 7. Board CommitteesFrom its own members, the Board has established an Audit Committee, an Organisation & Remuneration Committee and Nominations Committee. The Committees comprise a majority of non-executive members of the board and operate under Terms of Reference approved by the Board. All Board committees must be chaired by a non-Executive Director.7.1. Audit Committee (chaired by Paul Smart) The Audit Committee is responsible for: • Monitoring the work of the external Auditors and the internal audit function • Recommending appointment and removal of the Company’s external Auditor as appropriate and ensuring that the external Auditor or lead partner of the external Auditor is changed every five years • Reviewing the Company’s financial reports for compliance with appropriate laws and regulations and recommending to the Board adoption of the interim and year end financial statements and recommending the level of dividend • Surveillance of the broader aspects of responsible corporate governance including the Company’s general ethical and legal conduct • Monitoring the Company’s risk assessment and risk management strategies • Ensuring that the internal audit function is adequately resourced and has appropriate standing within the Company • Approving the use of the Auditors for any services other than audit services. 7.2. Organisation and Remuneration Committee (chaired by Richard Punter) The objectives of the Organisation and Remuneration Committee are to: • Assist the Board in the establishment of remuneration policies and practises for remuneration setting • Review remuneration arrangements for the Company’s Chief Executive Officer, other Senior Executives, and Directors (both non-executive and executive) • Ensure that the strategy, as agreed by the Board, to manage all aspects of the relationship between the Company and its employees is implemented • Check that the Company’s obligations in respect of legislative requirements, pertaining to the management of employees, are fulfilled. 7.3. The Nominations Committee is a subcommittee of the Organisation and Administration committee, chaired by the Chairman of the Company. It is responsible for identifying and recommending new directors to the Board. 8. Board Access to InformationDirectors are entitled to access all relevant company information and to management.9. Board Performance Evaluation and TrainingThe Board each year critically evaluates its own performance, processes and procedures.Individual Directors are evaluated annually through peer review coordinated through the Chairman. The Chairman’s review is co-ordinated through another Independent Director. The Company will contribute towards the reasonable costs of continuing education for directors where it benefits the Company. 10. Directors’ Remuneration PolicyExecutive Directors receive Directors’ fees separate from their executive remuneration.Total fees for Non-Executive Directors are fixed by the Shareholders in general meeting. Fees are ordinarily paid monthly and are abated where the director is unable to attend the monthly meeting. Directors are entitled to be paid consultancy fees at market rates for extraordinary services to the company. None were paid in the 2009 year. [The Company will be utilising consultancy services from Trisha Whiting in the 2010 year]. There are no share options for Directors, no loans are made to Directors and there are no retiring allowances to Directors without shareholder approval. A minimum of 25% of the Managing Director’s total remuneration must be dependent on the Company achieving Budgeted Profit. Directors’ fees shall include an additional payment for the company exceeding Budgeted Profit. 11. Risk ManagementThe Company has in place procedures to identify areas of significant business risk. Where appropriate the Board obtains advice directly from external advisors. The Board is responsible for ensuring appropriate procedures are in place to identify, monitor, manage, mitigate and insure the various risks to the business.In mitigation of identified risks, Postie Plus Group Limited has taken the following steps: • Succession Planning for key executives • Appointment of an Internal Audit Manager to review and implement internal controls as necessary. To ensure independence, the Internal Audit Manager reports directly to the Audit Committee • External Consultants have been retained to advise on IT Services, to obtain specialist skills where these are not available internally • Cross-functional Project Teams have been formed to integrate the acquired businesses and implement standard systems and processes across the company • Ongoing review and improvement of processes, including significant centralisation of financial and administration processes • Initiatives to encourage employee acceptance of and participation in new company structure • Foreign Exchange policies are reviewed at regular intervals with external consultants. 12. Trading in the Company’s SharesThe Board has established a policy and procedure for the guidance of Directors and senior executives on the laws governing share trading.Under the policy, Directors and senior managers are instructed that it is illegal to buy or sell ordinary shares, or any other listed securities that the company may from time to time have under issue, if they have material information that is not generally available to the equities market, and if it were generally available to the market, a reasonable person would expect it to have a material effect on the price of the company’s listed securities. The policy also covers the notification procedures that must be adopted by Directors and senior managers before they buy or sell the company’s listed securities. Appropriate training is provided to the senior managers and any other applicable personnel in the areas of insider trading laws and competition law. 13. Keeping in touch with Shareholders and StakeholdersPPGL has established a communications and disclosure policy to ensure compliance with NZX disclosure requirements and to ensure accountability for that compliance at a senior executive level.
Shareholder Communications Policy(As adopted by the Board on 22 October 2009) 1. PURPOSEThe purpose of PPGL’s Shareholder Communications Policy is to promote effective communication with shareholders and to encourage active participation at shareholder meetings 2. SHAREHOLDER COMMUNICATIONSPPGL will ensure that:2.1 All communications to shareholders are distributed in accordance with the New Zealand Companies Act 1993 and the Listing Rules of the New Zealand Stock Exchange (NZX). 2.2 Announcements and other forms of communication and materials referred to in this policy are made available on PPGL’s website within a reasonable time 2.3 This policy is updated and maintained as required in a timely manner. 3. COMMUNICATION METHODS3.1. The company seeks to ensure its shareholders are appropriately informed on its operations and results, with the delivery of timely and focused communication, and the holding of shareholder meetings in a manner conducive to achieving shareholder participation.3.2. To ensure shareholders have access to relevant information the company provides: • Half year and annual reports; • Advice on issues/events that may have material information content that could impact on the price of its traded securities under its market disclosure policy; • A website, primarily focused on the needs of investors, and on which both current and historical information on the company is recorded; • Additional explanatory memoranda where circumstances require, such as explanations of dividend changes; • Other explanatory releases as may be required by law 3.3 In communicating with shareholders, PPGL will also make use of the following forms of communication: - NZX - Business media - The Annual Meeting 4. ANNUAL SHAREHOLDERS’ MEETING (AGM)4.1 Meeting Details Details of the Annual Shareholders’ Meeting of PPGL including the date, time and location of the meeting will be set out clearly in: • The Notice of Meeting • PPGL’s annual report • On PPGL’s website (www.ppgl.co.nz) Shareholders can also obtain details of the ASM from PPGL’s Share Registry, Link Market Services Limited, Tel Ashburton (03) 308 8887 or Auckland (09) 375 5999. Email: Imenquiries@linkmarket services.com 4.2 Notice of Meeting The Notice of Meeting will be distributed to all shareholders prior to the ASM within the timeframe required by the New Zealand Companies Act 1993. The full text of the Notice of Meeting will also be available in the Investors Section of PPGL’s website. 4.3 Proxy Form A proxy form allowing shareholders to appoint a proxy in the event they are unable to attend the ASM will accompany the Notice of Meeting sent to all shareholders. 4.4 Shareholder Participation at ASM Shareholders are encouraged to participate in the ASM by asking questions or commenting on matters relating to the management of the company, the contents of the annual report/review, or the conduct of the audit including the preparation and content of the auditor’s report. The Chairman of the ASM will allow reasonable time for questions and comments. Shareholders who are not able to attend the ASM may submit questions by submitting these to the Company in writing marked to the attention of the Chairman or the Managing Director. The Chairman will endeavour to respond at the ASM to the more frequently answered questions submitted in writing by shareholders. 4.5 Attendance of Auditor at ASM PPGL ensures that its Auditor attends the ASM and is in a position to answer questions about the audit of PPGL’s financial information. 4.6 Chairman’s Address The Company will ensure that the Chairman’s address is released to the NZX contemporaneously to the commencement of the ASM. The Chairman’s address will be made available to shareholders on the Company’s website. 5. ANNUAL REPORTThe Annual Report will be available to all shareholders prior to the ASM in accordance with the timeframe requirements of the New Zealand Companies Act 1993.The Annual Report contains important financial information about PPGL as well as other important information regarding the company and its operations. In accordance with the requirements of the New Zealand Companies Act 1993, PPGL will send an Annual Review to all shareholders and will advise shareholders regarding the availability of the full Annual Report and advising that a concise annual review has been prepared. 6. HALF‐YEAR & FULL‐YEAR RESULTS
As the results are announced by PPGL, they will be made immediately available to shareholders by being posted to the Company’s website. Following the announcement of financial results to the NZX, PPGL may brief interested media, institutional investors and stockbroking analysts. Presentations that are made to such briefing sessions will be made available to shareholders by being posted to the Company’s website. 7. DIVIDENDS7.1 Dividend StatementsDividend Statements are despatched by mail on or before the date on which the dividend is to be paid. Dividend statements are sent to the address of the shareholder as this appears on PPGL’s share register. 7.2 Dividend Information If shareholders require information regarding dividends this can be obtained by contacting the Company Secretary or the Share Registry.
StakeholdersPPGL seeks to maintain a positive relationship with significant stakeholders, and requires appropriate and ethical conduct by executives and staff in interaction with stakeholders. PPGL aims to be a good employer and keeps its employees informed of relevant developments inside the Company through an internal communications strategy. This includes a Company intranet system, regular staff newsletter and other forms of communications such as meetings. PPGL executives must act with integrity and in compliance with the Company’s Code of Conduct and Ethics Policy in their professional relationships with PPGL’s suppliers. Executives of PPGL are expected in the normal course of PPGL’s business to make regular visits to suppliers and their manufacturing facilities to ascertain product integrity, and the product’s country of origin and compliance with relevant safety standards. PPGL strives to ensure an excellent relationship with customers. All staff are required to place emphasis on the importance of customer service and to interact with customers with fairness, honesty, helpfulness and indiscriminately. The Company’s trading priority is to “Put the Customer First”. Stakeholder Values1. We value our peopleOur people are the key to our success. We strive to provide a safe and fair workplace, competitive rewards, advancement on merit and recognition for work well done. We encourage a balance between work and home life. 2. We value our customers Our business exists to meet the needs of our customers. We strive to be our customers’ suppliers of choice in fair business partnership through product and service excellence. 3. We value our communities and our environment Our business cares about the world in which it operates. We strive to maintain good relationships with our communities. We act responsibly towards the environment. 4. We value high ethical standards of behaviour We treat others in the way we would like to be treated. We respect each other and act with honesty, openness and integrity in all that we do. 5. We value teamwork and supportive leadership Our leaders encourage individual accountability and support, and empower our people. We work as a team throughout New Zealand. 6. We value innovation, excellence, and results We believe that excellent results are the true measure of success. We take responsibility for our actions. We strive always for excellence, working for outstanding results for our shareholders, our customers, our communities and each other. PPGL aims to be a good employer and keeps its employees informed of relevant developments inside the Company through an internal communications strategy. The Company provides staff support services as appropriate. PPGL has have built professional relationships with its suppliers and executives of PPGL make regular visits to suppliers and their manufacturing facilities. Operational policies and practices are subject to ongoing review. |