The Value of Smart Governance Recognising the contribution Ātihau-Whanganui Incorporation (AWHI) governance makes to the organisation is the subject of an independent report from the global professional services entity, Deloitte. The report was requested by Andrew Beijeman, CE of AWHI, who said it was important to ensure that remuneration to Board members reflected the responsibilities they held and were consistent with other organisations across the agribusiness sector as well as other Māori entities. “Board remuneration has not been increased in more than a decade and the role has changed a great deal in that time,” he says. “We expect our Board members to bring their skills and intellect to bear on many different aspects of the business and rely on them to make important decisions that directly influence the future success of the organisation.” “This report enables us to review remuneration amounts and make a recommendation to shareholders at the Annual General Meeting at the end of the year.” The report considered the number
and length of meetings members were expected to attend, and the amount of preparation required for such meetings along with any time spent travelling. The depth and breadth of members’ responsibilities, duties such as representing AWHI at industry events, hosting of national and sector visitors and contribution to the four sub-committees and/or project teams (such as the recent trip to the USA) was also examined. Comparisons were made with other organisations of a similar size and amounts benchmarked against dimensional data such as revenue, asset levels and employee numbers, as well as industry guidelines and recommendations. The analysis concluded that the current remuneration levels of board members did not currently sit at the fair market rate identified in the report.
The issue of a chairperson premium was also considered. These are paid as a percentage of the base board member fee to acknowledge the significantly increased responsibilities and time commitment required. Currently the chairperson’s premium sits at 80% of the board base rate, and it was recommended that it remain at that level. “This report has enabled the management team to clarify the opinion that the remuneration for Board members should be increased,” says Andrew. “We intend to follow the advice we have been given and recommend that shareholders agree a rate of $32,000 per annum (up from $25,000) with an 80% premium for the chair.” Shareholders will get a chance to vote on this recommendation at the upcoming AGM.
Increase in governance responsibilities since the last remuneration review.
Total Equity ($) Diversification
(% of revenue outside of Sheep and Beef)
Shareholder numbers Succession Collaborations Gross Revenue ($) Operating EBITDA ($)
2017
2008
132,349,608
111,803,663
23%
13%
8,569
7,192
Associate Director Independent Audit & Risk Member
None
Te Hou Farms
None
19,290,060
9,343,017
4,049,275
1,692,968
Shareholder distributions ($)
691,090
319,038
Charitable donations ($)
362,000
16,000
“ This report enables us to review remuneration amounts and make a recommendation to shareholders at the Annual General Meeting at the end of the year.” Andrew Beijeman
TOITŪ TE MANA
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