apr-11.pdf (2.07 MB) - Crown Ownership Monitoring Unit

By 2011 the landscape for SOE disclosure had changed considerably, althoughchanges have not been applied universally. In order to avoid unnecessary compliancecosts for smaller companies, new provisions have affected mainly large SOEs.F igure 18 – Current SOE disclosure practiceContinuousDisclosurePeriodicReportingAnalystPresentationPublicMeetingEnergy SOEs:Genesis, Meridian,MRP, Solid Energy,TranspowerDisclosuresper company2010/11: Electricitycompanies 10-19Solid Energy 4All EnergySOEs nowprovide quarterlyoperational reportsto the publicAll Energy SOEsproduce “analystpresentations” ofannual resultsAll companiesschedule a publicmeetingOther Large SOEs:NZ Post (andKiwiBank),KiwiRail, Kordia4-5 disclosures percompany 2010/11Only interim (6-monthly) reportspublished asrequired by SOEActNZ Post producesan “analystpresentations” ofannual resultsAll companiesschedule a publicmeetingSmaller SOEs:Airways, ACP,AsureQuality,Learning Media,MetService, QVNo continuousdisclosurerequirementInterim reports(6-monthly)published asrequired bySOE ActDisclosure limitedto Annual Reportas required byCompanies Actand SOE ActOf these, only afew scheduled apublic meetingFigure 18 highlights not only the improvements in disclosure, but also the variationin disclosure levels across categories of SOE. Each of the initiatives ContinuousDisclosure, Periodic Reporting, Analyst Presentations and Public Meetings – representsa new disclosure channel for SOEs. As a result:• large SOEs now face similar disclosure requirements as those expected ofcompanies listed on the NZX, and• smaller SOEs, and those in less competitive environments, are subject to disclosurerequirements below those set by publicly traded companies.New disclosure channels alone are not sufficient; quality of disclosure isalso importantNew disclosure channels for large SOEs improve accountability, leading to anexpectation that this will translate into the ultimate goal of improved performance.However, for this to occur, good practice needs to follow. Are new disclosure channelsbeing used effectively and how good is the quality of information disclosed?In short, a framework has been established; however, performance improvement willonly come with appropriate behaviours within that framework.There are two components of the disclosure framework that merit closer attention:• Continuous Disclosure: the extent to which the quality and quantity of SOE disclosuresmeet expectations and/or match behaviours by NZX listed companies, and• Results Presentation: quality and timing of information disclosed around companyperformance relative to peer companies listed on the NZX; the primary focus beingon generator/retailers.page | 41