From Brian Gaynors Column in the NZ Herald today:
Unfortunately many listed New Zealand companies, including those in the NZX50 Index, are lacking management depth and it is not obvious who will replace the current chief executive if he suddenly resigns.
New Zealand Oil & Gas is an excellent example of this.
David Salisbury was appointed chief executive of the oil exploration and production company in April 2007. He had just returned from Vienna where he had been vice-president business development of OMV Exploration & Production.
Salisbury was quoted as saying "I relish the opportunity of working with business partners, shareholders and staff to capitalise on NZOG's current major projects and to position the company for further growth opportunities".
"Tui with its strong initial oil flows, Kupe as a solidly-based long-life asset, and the diversity brought to the portfolio by Pike River Coal together creates a very sound financial platform for an exciting growth path for NZOG".
Unfortunately these growth opportunities have not been realised and on June 30 Salisbury gave six months' notice of his resignation and will finish on December 29. Chairman Tony Radford said the company "will commence shortly to recruit a replacement chief executive".
When Australian Worldwide Exploration, the operator and 42.5 per cent owner of the Tui field, announced this week that Tui's reserves had been downgraded from 50.5 million barrels to 40 to 42 million barrels, NZOG seemed to be rudderless. The company made a short factual comment to the NZX with no quotes and no executive contact details. This was in stark contrast to earlier Tui reserves upgrade announcements which contained contact details for Salisbury and another company executive.
One of NZOG's problems is that Radford is based in Australia and he is not a great communicator. He was appointed to the NZOG board in June 1981 and has been chairman for most of this 30 year period.
NZOG's corporate governance leaves a lot to be desired and shareholders are now paying a big price for the company's inability to secure a long-term chief executive, as well as for its inadequate succession plans and its poor communications, particularly in adverse situations
http://www.nzherald.co.nz/business/n...ectid=10741723