Governance news bites

Governance is often in the headlines, and the last few weeks have been no exception. Recent news related to governance includes:

Extensive corporate governance and employment law work programme revealed

In the last few weeks an extensive corporate governance and employment law work programme has been revealed. Minister of Commerce and Consumer Affairs gave a speech to the Financial Services Council in which he outline key elements of his Ministerial work programme, including:

- Reviewing the Companies Act and reforming our corporate governance laws; and
- Related to this, launching a review of directors’ duties and liabilities led by the Law Commission
- Implementing a ‘consumer data right’ and laying the foundations for ‘open banking’ and ‘open electricity’ to inject more competition into our economy
- Creating a new model for the economic regulation of water services
- Invigorating New Zealand’s capital markets by removing barriers to list on the stock exchange and making it easier for KiwiSaver funds to be invested in unlisted assets
- Reviewing our competition law to prevent excessive market concentration
- Responding to recommendations from the Commerce Commission to improve competition in the banking and grocery sector

There has also been recent reporting on the employment law work programme lead by the Minister of Workplace Relations and Safety. Key elements include:

- An income threshold for unjustified dismissal claims
- A reduction in personal grievance payouts
- Introduction of a “gateway test” to differentiate between employees and contractors
- Needing pay secrecy
- Reintroducing pay reductions for strikes

As yet there is no word on the proposed changes to the Health and Safety at Work Act 2015, following consultation that closed on 31 October 2024 on which IoD submitted.

Cyber attacks have not gone away

The National Cyber Security Centre (NCSC) published their Cyber Threat Report 2023/24 in the past few weeks. It makes frightening reading. There were 7,122 reported cyber attacks in the last year. They report they disrupted 10.3 million cyber incidents in that period, up from 250,000 in the previous year. That sure is exponential growth! A recent story about a specific incident illustrates this at a practical level reported on a hacker infiltrating a law practice, finding and using a property settlement document and, based on that, sent an email from the law practice seeking settlement two weeks early. The only reason this didn’t happen was an eagle-eyed bank staff member noticed the bank account provided required an international money transfer. Similar things have happened with suppliers to New Zealand firms. All board need to continue to be vigilant.

“Green shoots” anyone?

New Zealand’s economic landscape is beginning to reveal tentative “green shoots” of recovery, according to recent analysis by the ASB Bank economics team. Their reports suggest that while the upturn is modest, early signs of renewed activity in key sectors are boosting both investor confidence and policy optimism. Reinforcing this cautious sentiment, the Reserve Bank of New Zealand reduced the Official Cash Rate on Wednesday 19 February 2025, a move designed to encourage borrowing and stimulate spending amid ongoing global headwinds. Both developments underscore a concerted effort by policymakers to balance short-term challenges with longer-term growth prospects.

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