Crown Company Monitoring Advisory Unit (CCMAU)

Executive summary

During 2006/07, CCMAU continued to take a leadership role in the ownership monitoring of the wide range of State-Owned Enterprises (SOEs), Crown companies and entities in its portfolio. The performance of these companies and entities is critical to the Government’s economic transformation priority theme.

During the year, these companies and entities faced a number of challenges and issues, and CCMAU was at the forefront of managing and advising shareholding Ministers on many of them. In some instances, company performance was adversely affected by these events. At the same time, we continued the process of long-term owners’ reviews of SOEs with the completion of a further two reviews, bringing the total completed to ten. A further review was substantially progressed at year end. Equally, we developed a set of non-financial performance indicators to enable the Government to measure the contribution Crown Research Institutes (CRIs) make to the wider economy. We also assisted Ministers to reinforce their ownership expectations for CRIs. Our Appointments and Governance team continued to identify skilled directors for Ministers to appoint to the boards of the companies and entities we monitor. Furthermore, CCMAU forged a new relationship with Massey University’s Graduate School of Business to provide our governance training programme.

CCMAU’s capability was tested at times this year with the loss of some experienced staff to the private sector and SOEs. However, we were able to recruit new staff with relevant skills and experience to ensure Ministers’ expectations continued to be met. The opportunity now exists for CCMAU to enhance its ownership monitoring role, building on current expertise to more effectively address the Government’s wider ownership objectives.

What we do

CCMAU aims to be the New Zealand Government’s ownership advisor of choice in the provision of commercial and wider ownership advice.

CCMAU provides services in the following areas:

• Monitoring – reporting on business plans, company reports, performance against targets and sectoral trends.
• Ownership advice – advising on strategic issues, investment and diversification opportunities, restructuring issues and the impact of policy decisions.
• Ministerial servicing – managing issues and drafting replies to correspondence, parliamentary questions and Official Information Act requests.
• Governance – identifying and screening potential directors, managing appointment processes and promoting best-practice corporate governance of Crown companies and entities.

Relationship with the Treasury

The Executive Director of CCMAU is directly accountable to the Secretary to the Treasury for the Crown’s investment in CCMAU, and for CCMAU’s performance in providing the output classes Ministers seek.

The year in review

CCMAU contributed to a wide range of activities and initiatives this year. The key achievements in each sector were:

Maintaining and developing capability

CCMAU’s reputation and ability to exceed the expectations of Ministers and key stakeholders are very dependent on the skill and experience of its staff and their ability to manage relationships with a wide range of contacts. During the year we continued to pay attention to making CCMAU a great place to work and to provide staff with the resources necessary to do their jobs well.

While CCMAU is able to attract high-quality candidates to fill the vacancies that occur, the cost of recruiting and inducting new staff is significant. This is an ongoing challenge for a small agency with limited promotional opportunities.

CCMAU continued to measure the satisfaction of its staff by completing another staff climate survey. While the staff satisfaction index resulting from this survey dropped slightly this year, the variance was not material.

Over the past three years key measures of staff capability and satisfaction were:

Murray Wright
Executive Director