Principle 1 – Code of Ethical Behaviour
POAL believe that the Board must set high standards of ethical behaviour, model this behaviour and hold Management accountable for these standards being followed throughout the organisation.
To achieve this POAL has a Code of Ethics which documents the standards of ethical behaviour to which its directors and employees must adhere. In addition POAL has separate policies for managing conflicts of interest, accepting gifts and hospitality, approving sponsorship and donations, managing fraud risk and for whistle blowing. These policies are published on POAL’s intranet and staff are required to read them and receive training on these as required. The Board monitors adherence to the Code of Ethics and holds directors, executives, and other staff accountable for acting ethically at all times.
It is accepted and acknowledged that Directors and Officers will have other business interests. All such interests as a shareholder, director, officer or trustee of other companies or entities are recorded in POAL’s Interest Register. If it appears there may be a conflict of interest for any Director or Officer, the Chair will discuss the issue with that person as appropriate. Any Director is at liberty to accept other board appointments, providing those appointments are not in conflict with POAL’s business.
Principle 2 – Board Composition and Performance
POAL's Board Charter sets out the roles and responsibilities of the Board, relationships between the Board and Management, and Board procedures.
The process for the appointment, reappointment and termination of directors to POAL’s Board is contained in Auckland Council’s Board Appointment and Remuneration Policy. Under this policy:
- appointments to POAL’s board are made by an appointment panel, comprising the Mayor of Auckland Council, Chief Executive of Auckland Council (or representative) and Board Chair of POAL
- elected members and staff of Auckland Council will not be appointed as a director of POAL.
Auckland Council enters into written agreements with each newly appointed director establishing the terms of their appointment. New Directors complete POAL's induction programme to ensure they have an understanding of the port industry and POAL's operations.
The Board is made up of between six and nine members.
All Directors are independent and none perform any management function. The Board considers that individually and
collectively, these Directors have an appropriate mix of skills, qualifications
and experience to enable them to appropriately discharge their duties
effectively. Information about Directors,
including any other director and shareholder interests, are disclosed here.
POAL believes that diversity and inclusivity are
essential to driving sustainable commercial success and creating a high
performing values driven culture. The Board aims to have diversity of skills,
experience, length of service, knowledge and gender. POAL has a Diversity and Inclusion Policy which outlines its commitment for a
diverse workforce and an inclusive work environment. POAL reports its Board and
Executive gender balance and length of service as well as overall employee
gender balance, age profile and years of service in its Annual Report.
Directors undertake appropriate training on how to best perform their duties when it is considered beneficial.
In accordance with Auckland Council’s Board Appointment and Remuneration Policy the Mayor and Chief Executive of Auckland Council is provided with a report by POAL’s Board summarising the annual review of its performance and every second year this review is conducted by an experienced external provider.
The Board has delegated the day-to-day management of the Company to the Chief Executive Officer. The CEO in turn delegates authority to management. These authorisation levels are set out in the Delegated Authority Policy.
Principle 3 – Board Committees
The Board has two standing committees; the Audit Committee and the Remuneration Committee, and may also establish other special purpose committees to deal with specific issues where appropriate to increase its effectiveness. All committees operate under a Charter approved by the Board, click here for the Audit Committee Charter and here for the Remuneration Committee Charter. Committee membership and attendance is disclosed
in POAL’s Annual Report.
The Audit Committee assists the Board in fulfilling its responsibilities with respect to financial reporting, external audit and internal audit. The Committee is made up of at least three Directors appointed by the Board, one of whom must be the Board Chair who cannot chair the Committee. The Committee meets at least four times a year and all Directors receive Committee papers and minutes and may attend Committee meetings. Employees only attend Committee meetings at the invitation of the Committee Chair.
The Remuneration Committee assists the Board in fulfilling its responsibilities with respect to remuneration and incentive policies, practices and performance indicators. The Committee is chaired by the Board Chair, includes at least two other Directors, and meets at least twice a year. Employees only attend Committee meetings at the invitation of the Committee Chair.
Principle 4 – Reporting and Disclosure
Under Auckland Council's Disclosure Policy, POAL is required to formally report to the Council any material information, or information of an exceptional or extraordinary nature. POAL's Board considers this requirement during a standing board agenda item.
POAL maintains this website where stakeholders can access financial and operational information, media announcements, customer communications and key corporate governance information such as charters and policies.
POAL's half yearly and annual reports contain financial and non-financial information, including its strategy, key performance measures, environmental impacts, health and safety performance, sustainability initiatives and critical risks. POAL follows the Integrated Reporting framework to ensure there is balanced, transparent, public disclosure which connects financial, social and environmental performance.
Principle 5 – Remuneration
POAL’s shareholder, Auckland Council, determine
the total remuneration payable to POAL’s Directors as set out in the Council’s
Board Appointment and Remuneration Policy. Changes to remuneration are recommended
by POAL’s Board, based on advice from a remuneration benchmarking exercise
undertaken by an external consultancy. In accordance with POAL’s Constitution,
the Board will then determine the amount of remuneration payable to each Director.
As required by section 161 of the Companies Act 1993, each Director must be of
the opinion that the remuneration is fair to the Company, and must sign a
certificate to that effect which gives the grounds for their opinion. Actual
Directors’ remuneration paid for the year is disclosed in POAL’s Annual Report.
POAL's Constitution makes no provision for the payment of a retirement allowance to a Director or former Director.
Remuneration for employees is overseen by POAL's Remuneration Committee. In accordance with the Companies Act 1993, POAL's Annual Report discloses the number of employees or former employees who, during the year, received remuneration and any other benefits, of over $100,000 per annum in brackets of $10,000. Employee remuneration may include short and long term incentive payments and POAL does not disclose these separately. Members of POAL's Executive are appointed as Directors to POAL subsidiaries, associates and joint ventures. This is considered part of their role and they do not receive director fees for these appointments.
Principle 6 – Risk Management
POAL has a Risk Management Policy which describes its risk management framework, assigns accountability for managing risk, requires risks to be managed and mitigated, and outlines risk reporting. This approach enables POAL to pursue business opportunities and grow shareholder value; as well as developing and protecting its people, assets, and reputation, as well as the environment.
POAL's risk management framework ensures a comprehensive approach across the business with oversight by management and the Board. Risk assessments are ongoing within each area of the business to identify, evaluate and manage risks. Significant risks are reported to the Executive team who maintain and regularly review the Key Risk Register. This register is subject to a formal annual review by the Board.
Information about the critical risks that POAL face and how these are managed is contained within the Chief Executive's Statement of the Annual Report.
The risk management function works closely with insurers, internal and external auditors, and other external advisors to ensure there is a common understanding of the purpose and effectiveness of controls that mitigate risks and that those risks which remain are acceptable.
Principle 7 – Auditors
As required by the Port Companies Act 1988, the Auditor-General is the auditor of POAL's financial statements. The appointed auditor must satisfy the independence requirements of the Auditor-General and External Reporting Board. POAL's Auditor Independence Policy requires that the auditor or lead audit partner is changed at least every five years and requires that the Audit Committee approve any non-audit service provided by the auditor to avoid any potential conflict of interest.
POAL's internal audit function is provided by an external provider whose appointment is made by the Board. Its programme of work is based on the critical risks faced by POAL and is approved by the Board. All internal audit reports are distributed to the Audit Committee for review, which monitors progress in completing the audit recommendations.
POAL's Audit Committee Charter sets out the Committee’s responsibilities for
both external and internal audits. The
Committee meets regularly with both the external and internal auditor, both
with and without management present.
Principle 8 – Shareholder Rights & Relations
POAL was established as a Port Company under the
Port Companies Act 1988 and, as a result, acquired the port-related commercial
undertakings of the Auckland Harbour Board.
Under this Act the principal objective of every port company is to
operate as a successful business.
Although not defined by the Act, POAL understands this to mean it must
operate as profitably and efficiently as comparable businesses that are
privately owned, following generally accepted commercial practices and
disciplines. Port Companies must prepare
and publish an annual Statement of Corporate Intent (SCI) declaring proposed
activities and performance targets relating to financial, environmental and
social performance measures. POAL’s shareholder,
Auckland Council, has the power to require POAL to modify the SCI by including
or omitting any provision, after having regard to POAL’s obligation to operate
as a successful business. Once the SCI is adopted by Auckland Council, it is published on POAL’s website and all decisions must be made in accordance with it.
The purpose of POAL's SCI is to:
- state publicly the activities and intentions, and the objectives to which those activities will contribute; and
- provide a basis for the accountability of the Board to Auckland Council for POAL's performance.
The SCI defines the nature and scope of services POAL provides, and the key performance measures it is targeting. It includes the dividend policy, and details when POAL is required to consult with Auckland Council for material transactions.
A Memorandum of Understanding (MoU) between POAL
and Auckland Council sets out the agreed framework in respect of the governance
relationship between the two entities.
POAL provides Auckland Council with the following reports:
- Annual SCI draft for discussion and final version
- Half Yearly Report including performance commentary, financial statements and performance against SCI targets
- Annual Report including performance commentary, financial statements, performance against SCI targets
- Quarterly Reports including financial updates and performance against SCI targets.
In addition, representatives from POAL's Board and Executive meet with Council representatives to discuss strategic issues and business performance, at least once a year.
POAL plays a vital role in New Zealand's economy and it recognises that due to its central location in Auckland, many stakeholder groups are both interested and affected by its operations and developments. POAL is committed to increasing its transparency, so that stakeholders can better understand how its business operates, the value it adds and how it is likely to develop in the future. POAL is committed to greater engagement with stakeholders, particularly the Auckland public, when it comes to the construction of new infrastructure on the port, as it acknowledges the sensitive nature of such development. POAL engages stakeholders through regular meetings with different stakeholders groups and independent surveys to understand what matters to them and how they assess POAL's performance. The Board closely monitors POAL's conduct with its shareholder engagement to ensure the behaviour is ethical and enhances the company's reputation.