The NZX's revised corporate governance code (the NZX Code) and its supporting rule amendments have been published. The New Zealand Stock Exchange (NZX) which administers the code said this was the first substantial update since 2003 and represented a significant step forward for corporate governance reporting requirements in New Zealand.

NZX conducted a major consultation on the code last year and said it had received more than 80 high-quality submissions throughout the consultation process from major governance groups, issuers, corporate firms and investors in New Zealand and overseas.

The NZX Code covers eight principles that reflect internationally accepted corporate governance practices, which are intended to protect the interests of and provide long-term value to shareholders while also seeking to reduce the cost of capital for issuers. Each principle contains specific recommendations and explanatory commentary that NZX listed issuers are encouraged to adopt.

NZX said it considered that the final NZX Code would result in a significant improvement in corporate governance standards among its main board listed issuers. The updated NZX code reflected the broad stakeholder views in New Zealand’s capital markets and reduced fragmentation between NZX’s Code and other existing corporate governance frameworks, the NZX said.

NZX chairman James Miller said: "I am a strong supporter of organisations demonstrating sound corporate governance practices, which can lead to a lower cost of capital and higher valuations for NZX listed companies, offsetting any additional regulatory burden. The streamlined NZX Code will result in improved transparency for investors, driving increased confidence in our capital markets."

NZX general counsel and head of policy, Hamish Macdonald, added: "The NZX Code seeks to promote good corporate governance and ensure a single source of recommendations for New Zealand listed issuers. The extensive engagement NZX received as part of this review reflects the industry’s desire for strong corporate governance and the key leadership role NZX plays in encouraging these improved practices."

The New Zealand's updated corporate governance code will take effect on 1 October 2017 so that it must be reported against for reporting periods ending 31 December 2017 and beyond. Issuers are encouraged to adopt the recommendations on a voluntary basis earlier if they wish. NZX will engage with issuers on the recommended changes before the NZX Code takes effect.