Triple Dipper Jim

Jim Anderton came out claiming Councillors who are also directors of CCOs, should not be paid directors fees. Apart from the stupidity of wanting volunteers to run billion dollar enterprises, the hypocrisy is even worse.

Jim plans to triple dip. He will be claiming salaries and expenses for the jobs of Mayor, MP and Party Leader if elected.He claims he will donate one of them to charity or something but his total combined salaries and expenses will be around $700,000 a year.

The Press editorial notes:

By raising questions about city councillors who are augmenting their council pay with fees from directorships on city corporate entities, the mayoral aspirant Jim Anderton was undoubtedly seeking to exploit the politics of envy to embarrass his political opponents. …

The council undoubtedly needs good directors on the entities it controls. One of them, Christchurch City Holdings Ltd, for instance, is a $2.2 billion company, which contributes large dividends to the council. CCHL is the investment arm of the council, holding shares in seven trading companies that run some of the key infrastructure of the city, including electricity delivery, the port of Lyttelton, the Christchurch International Airport, and one of the city’s bus lines.

Companies of this importance must have sound and competent governance, with directors who have the appropriate skills. The selection process the council uses seems to ensure that any councillors asked to be directors meet those requirements. However, the question needs to be asked whether councillors need to be on boards of council-owned companies at all  or whether there are other suitably qualified candidates, whose selection might avoid the perception that some councillors are simply doing well out of a council perk.

Not all Councillors will have the skills and experience to be a company director. They carry significant legal and reputational risks, and as a director you are expected to contribute to the company’s strategy and direction. These are not roles for volunteer politicians.

Most of the directors of a CCO should not be Councillors. I think it is wise to have one Director who is a Councillor, as it provides a link back to the owner. However they are there as a full Director – not as some sort of unpaid liaison.