10 May 2017

NZX Corporate Governance Code to raise standards

1:20 pm on 10 May 2017

The capital markets' new Corporate Governance Code aims to bring it up-to-speed with international best practice, while reducing costs for issuers and further protecting shareholders' interests.

NZX signage on a building in Auckland, 2015.

Photo: 123RF

It is the first substantial update to the code of practice in 14 years, and followed extensive consultation with major governance groups, issuers, corporate firms and domestic and international investors.

NZX chairman James Miller said sound corporate governance practices could lead to a lower cost of capital and higher valuations for NZX-listed companies, which offset any additional regulatory burden.

"The streamlined NZX Code will result in improved transparency for investors, driving increased confidence in our capital markets." he said.

BusinessNZ chief executive Kirk Hope said companies will benefit from the guidelines for sustainability reporting.

"Customers and investors increasingly want reporting on environmental and social performance, and NZX's guidelines will help companies fully inform stakeholders in a manner consistent with world best practice," he said.

The Financial Markets Authority said the code was aligned to the principles in its Corporate Governance Handbook.

It said the FMA handbook was still relevant, but it would review it to ensure it was consistent with the reporting regimes for listed companies, and whether any changes were required.