The Handbook contains principles and guidelines for directors, executives, and advisers of non-listed and public-sector New Zealand companies.

The Handbook makes updates to:

• reflect developments in corporate governance best practice to align with New Zealand and global expectations; and
• remove overlap with the NZX Corporate Governance Code (NZX Code), so that the NZX Code will be the primary source of guidance for NZX listed issuers.

The nine FMA Corporate Governance principles have been reduced to eight, regarding how directors should govern in relation to ethical standards, board composition and performance, board committees, reporting and disclosure, remuneration, risk management, auditors, and shareholder relations and stakeholder interests.

The content areas that have been updated relate to non-financial reporting and environmental and social governance reporting, guidelines on auditor independence and audit committees, and transparency of board composition and remuneration.

The Handbook is welcomed by NZX listed companies who can now focus on corporate governance practices in the NZX Code rather than both sources. However, the FMA still reserves the right to take appropriate action against companies which, in their belief, display poor governance.

While the principles in the Handbook do not impose new legal obligations, and while reporting against these principles remains voluntary, the Handbook does contain the FMA’s revised expectations of corporate governance in New Zealand.