Grant Robertson letter to Air New Zealand: What chairman Dame Therese Walsh thinks

Air New Zealand chair Dame Therese Walsh says it is normal to discuss board appointments with shareholding minister Grant Robertson, and it is already working to renew its directors.

Opposition MPs say a letter from Robertson to the airline showed the Government was trying to exert inappropriate influence on the board of Air NZ, in which it has a 52 per cent stake.

In what one described as “an aggressive letter”, Robertson says as majority shareholder the Government expects to be involved in the process that will lead to board renewal.

Walsh characterised this as business as usual, saying: “As is the normal process, we will discuss candidates for board appointments with the Minister of Finance in his capacity as shareholding minister.” She said the airline was moving to a new phase in its recovery from the devastation of the pandemic and there would be changes.

“In light of the upcoming retirement of Jan Dawson as signalled at the annual shareholder meeting, and some directors entering the final phase of their tenure, we are assessing the mix of abilities required as the airline moves out of the survive phase and into revive,” she said in a statement to the Herald.

She said the board had worked extremely hard during the past year.

“The balance of skills and experience on the board has served us well and we continue to review our skills and diversity matrices which we do annually.”

Robertson’s letter sets out in detail the Government’s expectations of the airline, including being involved in board renewal.

It was written at the same time as a $600 million extension of a backstop loan to $1.5 billion, which means the airline can defer a capital raising.

In Parliament yesterday, Robertson said directors on the Air New Zealand board took the post knowing the Government had a majority stake.

He said board members understood they were part of something with a massive legacy to New Zealand, which mattered to people all around the country and had a role in economic development.

Robertson defended his right to set out in detail expectations of the airline.

”We would be letting New Zealanders down. We’d have a 52 per cent stake and we’d be washing our hands of it and saying it doesn’t matter — that hasn’t worked for New Zealand when it comes to an airline in the past, and that is why that is in there.”

He has been attacked for making the directors’ commercial obligations under the mixed ownership model incompatible with the Government’s expectations.

In response, Robertson said: “The Government — the 52 per cent shareholder — is expressing its expectations, exactly what a majority shareholder would do in the private sector as well; that’s exactly the way it plays out. We make clear our expectations as the majority shareholder.”

Who's on board

It’s been said the worst thing an airline needs is too many airline people running it.

They need plenty of good businesspeople first, and then the good airline part naturally follows, so the theory goes. The aviation scene is littered with the financial wreckage of fine airlines that were lousy businesses. Air New Zealand has, at least until the pandemic struck, got that good airline/good business balance right.

There’s little previous airline experience on the board but a solid core of directors have been there for five to 10 years.

The only member who has worked for an airline, Larry De Shon, last did so in a big role with United Airlines15 years ago. And because of Covid-19, he hasn’t been able to travel from his home in the United States to New Zealand since his appointment a year ago.

Here’s the current lineup:

Dame Therese Walsh
Appointed in 2016, chair since 2019. Recently became chair of ASB and at the same time resigned as a Contact director. Previously had top roles in rugby and cricket world cups in 2011 and 2015. Formerly an auditor.

Jan Dawson
Appointed in 2011. Chair of Westpac NZ and a director of AIG Insurance, Meridian Energy and World Sailing.

Rob Jager
Appointed 2013. Former head of Shell group of companies in NZ and more recently the VP of Shell Australia’s Prelude Floating LNG and wider East Browse assets offshore of Western Australia.

Linda Jenkinson
Appointed in 2014. An entrepreneur who has started three multinational companies, one of which listed on the NASDAQ. Most recently she was the co-founder of John Paul, a global concierge services and digital solutions company.

Jonathan Mason
Appointed in 2014. Before joining board was Fonterra CFO and has 30 years’ experience in the financial sector.

Laurissa Cooney
Appointed in 2019. Chair of Tourism Bay of Plenty, director for Goodman AWF Madison Group and a Trustee on the Charitable Investment Trust for Ngāi Tai ki Tāmaki.

Larry De Shon
Appointed in April last year. Most recently head of Avis Budget Group; until 2006 he had 28 years with United Airlines where he held various executive roles.

Dean Bracewell
Appointed in April last year. Former managing director of Freightways, director of Tainui Group Holdings, Property for Industry and the Halberg Foundation.

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