A Financial Markets Authority review of corporate governance disclosure by 45 companies shows that few companies are publicly disclosing some information included in its corporate governance principles.
The review of both listed and unlisted companies found that while New Zealand listed companies publicly disclose about two-thirds of the corporate governance information that the FMA believes would be useful to investors, on average unlisted companies provided only 24% of the recommended governance information.
The review looked at information provided in public disclosures by companies about how they address the principles. It did not assess the quality of corporate governance, but the extent to which the companies provide information about their approach to corporate governance.
The FMA says its review shows that while it is possible to find commentary in the annual report or in company websites about governance principles such as a code of ethics, the remuneration policy, or risk management policies, few companies are actually disclosing the actual code or policies.
The FMA published a Corporate Governance Handbook in 2014, with nine corporate governance principles.
It says improving the quality of reporting on corporate governance supports another of its key priorities in its Strategic Risk Outlook: investor decision-making. The FMA says it wants to promote high standards of corporate governance, and ultimately improve confidence in New Zealand's capital markets.
"We are sharing our findings so companies can reflect on their governance practices and disclosures," says FMA Director of Strategy and Risk, Simone Robbers.
"While the results overall are encouraging there is work to be done to ensure that investors can find information to help them assess the companies they are considering investing with, and make informed investment decisions."