Company directors will have full confidence that they are able to take social, environmental, and governance matters into account when determining the best interests of a company, following Parliament passing a members’ bill from Camilla Belich.

“The Companies (Directors Duties) Amendment Bill will enable company directors to look beyond simple profit with confidence to take a range of factors into account when determining the best interests of the company,” says Camilla Belich.

“With this amendment, the Companies Act will recognise additional factors that directors may take into account when determining the best interests of a company. This could include environmental impacts, good corporate ethics, being a good employer, and the interests of the wider community,”

“New Zealand would not be the first country to take this approach to the duties of company directors. The United Kingdom has allowed company directors to regard environmental, social, and governance factors since 2006”, says Camilla Belich.

The Bill will amend the Companies Act 1993 by inserting a fifth subsection into Section 131 of the Act. Section 131 sets out the duty of a director of a company to act in good faith, and in what the director believes to be in the best interests of the company when exercising powers or performing duties.

Editors note: this Bill was first a member’s bill in the name of Hon. Dr Duncan Webb

© Scoop Media