NZX is pleased to announce the introduction, subject to Financial Markets Authority approval, of a Diversity Listing Rule, following a consultation process with the markets in April and May this year.
The new Rule will be applied to annual reports for all NZX Main Board listed issuers with a balance date on or after 31 December 2012.
NZX’s primary concern, as the operator of New Zealand’s capital markets, is that listed issuers provide all relevant information to the market so investors can develop an informed view of the current, and potential future, value of a company’s securities.
There is credible research based evidence which suggests that diversity - and gender diversity in particular – at both Board and senior management level contributes to improved performance.
NZX is also conscious of the need to balance provision of information to investors with the ongoing compliance costs to issuers. Therefore, in response to the feedback NZX received during the consultation process, a number of changes to the proposed Rule have been made which give companies flexibility around their decisions to develop a formal diversity policy while encouraging them to do so and to set measurable objectives.
In summary, the new Diversity Rule will require listed issuers to:
• Provide a breakdown of the gender composition of their Directors and Officers; and
• If they have a formal diversity policy, give an evaluation of their performance with respect to that
“The responses on quantifying gender composition at governance and senior management level indicated that this is an issue of importance to our markets. Therefore we elected to incorporate this into our Rules,” said NZX CEO Tim Bennett.
“However, it’s important that we give our listed companies the flexibility to make their own decisions about whether a formal diversity policy is a priority for them at this stage. Obviously, over time, we’d like to see more listed companies taking the opportunity to report on diversity as a contributor to investing decisions made by shareholders,” said Bennett.
NZX will work with the Ministry of Women’s Affairs and agencies such as the 25% Group and Global Women, who are supporting companies to develop and implement their own gender diversity policies.
Further information about the Diversity Rule is attached to this announcement. This document, and submissions received during the consultation period, will be made available at http://www.nzx.com/market-supervision/rules-consultation on Tuesday 10 July.