A board's success depends entirely on the people who sit around the board table and how they contribute their skills and perspectives to discussion and debate. In some structures, the directors/trustees are elected by the owners/shareholders so the board composition is decided by the election process. In others, directors/trustees are appointed and the mix of skills can be carefully planned. In all boards the mix of directors/trustees should be one that gives the depth and breadth needed to make good decisions for the future of the organisation.

Directors and trustees should receive formal notification of their appointment. See the points that should be included in this letter.

How many?

The size of the board depends on the mix of skills needed, legal, constitutional and representation requirements, the size of the organisation itself, and the number of people that can be expected to work effectively together.

Points to consider in selecting directors/trustees are:

• Purpose of the organisation: Social and commercial goals
   
• The mix of skills: What skills are needed alongside existing directors/trustees? Skills could be direct business skills such as financial, investment, marketing and product development; specialist skills such as agricultural, forestry, engineering etc; or other skills which are needed to take the organisation towards its vision such as legal knowledge or knowledge of tikanga and whakapapa.
   
• Personal qualities: Directors/trustees need to be able to work alongside others to get to an outcome. They need to have clarity in debate, integrity and courage, and be committed to the vision of the organisation.
   
• Term of appointment: In some structures used by Māori organisations, and in some organisational constitutions, directors/trustees have an open-ended term. Other structures have board memberships set for a certain number of years with one or more renewable terms.
   
• Tikanga and values: An understanding of tikanga, whakapapa and the cultural values relating to the organisation's business may be important in assessing candidates for board positions.
   
• Representation required by the law, funders or others: In some organisations, the constitution, law, funders, or other rules may specify that a particular representation is required as part of the board mix. Even if you are appointed to represent a specific group, your duty is to make decisions for the good of the organisation as a whole.
   
• Time: Directors/trustees must have the time to give to their board work. An effective board relies on members being able to give priority to preparation and attendance.

More information for Charitable Trusts

Charitable Trusts are governed by a Board.

The Trust Deed or other document establishing the trust or society sets out the process for the appointment of trustees (or members) to the board.

Evidence of the appointment of new board members is required to be recorded by the chairman in a memorandum. The form of memorandum is set out in Schedule 1 of the Charitable Trusts Act 1957.

Recruiting new board members can be a particularly challenging area for Māori charitable trusts. Rather than a strictly business skill base, board appointments may be influenced by the requirements of the organisation including whakapapa and tikanga requirements (i.e. a rangatira or respected elder), whanaungatanga (a relative), or because of expertise in other fields (i.e. business/financial skills/qualifications).

Where a board cannot find all the skills in one person, the board may balance people who are appointed for business skills and others for their tikanga skills. Transparency and quality control are essential in the appointment process. This can be helped by advertising vacancies, candidate vetting, education/training of existing board members, regular board member rotation, annual assessment/audit of performance and procedures for removal of board members in the event of non-performance.

More information for Incorporated Societies

An understanding of history, tikanga, and the cultural values relating to the society's business may be important in assessing candidates for board positions. Some societies refer to the Treaty of Waitangi in their mission/vision statements and core legal documents. Boards need to be clear as to what the references actually mean as far as governance is concerned as they could be held to account in the event of non-compliance.

More information for Māori Trust Boards

Beneficiaries elect the members of the Māori Trust Boards.

There are restrictions as to who can be appointed as a board.

In particular only beneficiaries can stand for election and no person can be appointed to the board who is:

• Mentally disordered
• An undischarged bankrupt
• A person convicted of an offence punishable by imprisonment for a term of six months or longer, unless he or she has received a free pardon or has served his or her sentence or suffered the penalty imposed

Points to consider in electing board members are:

• Term of board member: The term of a board member is normally three years.
• Tikanga and values: An understanding of history, tikanga and the cultural values relating to the Trust Board's operations may be important in assessing candidates for board positions. Elections may also be influenced by the whakapapa of the candidate and his or her standing in his or her iwi or hapu.
• Ability to work with others to get an outcome: Communication skills and a commitment to advance the trust board are essential alongside the other skills a board member brings.
• Business skills and experience: Māori Trust Boards often hold significant assets. The types of business skills required are sound commercial judgment, an understanding of business requirements such as strategy, development, and understanding of financial implications and a familiarity with legal requirements. The mix of business skills on a board may change depending on the stage of the organisation - for example whether it is in start up mode, or has a long history.
• Required Representation: The requirements for board representation are set out in legislation and associated regulations including the Māori Trust Boards Act 1955 the Māori Trust Board Regulations. Māori Trust Boards with their own legislation (for example Ngati Porou in Te Runanga o Ngati Porou Act 1987) will also need to comply with the separate legislation.
• Time: Board members must have the time to give to their board work. An effective board relies on members being able to give priority to preparing for and attending board meetings.

More information for Trusts

The original trustees are those appointed by the trust deed.

The procedure for appointing new trustees is normally contained in the trust deed. The procedure in the trust deed should be used.

• Term of appointment: A term of appointment for the trustees may be set out in the trust deed. Trustees should familiarise themselves with the trust deed and in particular any provisions to appoint and remove trustees.
• Tikanga and values: An understanding of history, tikanga and the cultural values relating to the whanau may be important to assessing potential independent trustees.

More information for Structures under the Te Ture Whenua Māori Act

The Māori Land Court makes the appointment of trustees.

In deciding whether or not to appoint a person as a trustee the Māori Land Court is required to have regard to the ability, experience and knowledge of the proposed trustee.

The Māori Land Court will not appoint a person to a trust unless it is satisfied that the appointment will be broadly acceptable to the owners.

The persons who may be appointed as trustees are:

• An individual
• A Māori Trust Board
• A Māori Incorporation
• The Māori Trustee
• The Public Trust
• A Trustee Company (within the meaning of the Trustees Company Act 1967)

The Court when establishing a trust must appoint one or more responsible trustees. The Court may also appoint one or more advisory trustees and one or more custodian trustees.

Responsible trustees are responsible for:

1. Carrying out the terms of the trust
2. Administering and managing the business of the trust
3. Preserving the assets of the trust, and
4. Collecting and distributing the income of the trust to beneficiaries

Advisory trustees advise responsible trustees on any matter relating to the trust

Custodian trustees if appointed, will have the trust property vested in them. However, the responsible trustee is responsible for the management of the trust property. Custodian trustees are responsible for:

• Holding the assets of the trust
• Disposing of the assets
• Signing documents as directed by the responsible trustees

In the event that the custodian trustee disagrees with a direction of the responsible trustees he or she may apply to the Māori Land Court for directions.

Interested Trustees

Interested trustees are permitted.

In particular a person is not disqualified from being elected or from holding office as a trustee because of that person's employment as a servant or officer of the trust, or interest or concern in any contract made by the trust. However, such trustees are prohibited from voting or participating in matters that affect any other interests or positions they may have with the trust  (section 227A Te Ture Whenua Māori Act 1993).

Recruiting new trustees

Recruiting new trustees can be a particularly challenging area for Māori Land Court trusts. Rather than a strictly business skill base, trustee appointments may be influenced by the requirements of the trust including whakapapa and tikanga requirements (i.e. rangatira or respected elder), whanaungatanga (representation from various whanau) or because of expertise in other fields (i.e. business/financial skills/qualifications). If a trust for example cannot find all the skills in one person, the trust may balance people who are appointed for personal skills and others for their tikanga skills.

Transparency and quality control are essential in the appointment process are recommended. Where particular skills or expertise are sought or required then the trustees should make this known to the beneficiaries.

Term

The term of appointment for trustees may be open ended. Accordingly there is a need for those trustees to make a strong contribution for many years. Other Māori trusts have trustees for a certain number of years and are usually renewable.

Tikanga and values

An understanding of history, tikanga and the cultural values relating to the trust may be important in assessing candidates to be trustees.

Tikanga principles are often put into practice by Māori trusts alongside general governance principles. For example Māori land trusts may take into account the aspirations of the whanau in relation to its employment policy.

Trustees need to be aware of relevant employment laws to ensure that the correct legal procedures are followed. This is particularly important in relation to personal grievance and dismissal issues.

The aspirations of the whanau landowners may also include the expectation that beef and mutton be provided for tangihanga at the local marae/s or for important hui. Such aspirations are often inconsistent with the commercial aspirations of the trustees and other owners. It is important that the trustees establish a clear policy or guidelines with the whanau to ensure that the commercial aims are not put in jeopardy and to avoid any accusations of inappropriate behaviour.

More information for Māori Incorporations

Appointment of Committee of Management

When an order is made incorporating the owners of any land, the Māori Land Court appoints an interim committee of management consisting of at least three and up to seven members.

The people who are appointed hold office as interim members of the committee of management until the first annual general meeting of the incorporation.

Recruiting new Committee members

An effective committee should contain a balance of experience and skills, follow a philosophy of collective responsibility and communicate appropriately with shareholders. As committees are elected the experience and skill base may be affected by the outcome of the three yearly elections.

The committee members are elected at the annual general meeting. Elections to the committee may be influenced by whakapapa and tikanga requirements as well as expertise in a particular field. Owners with the largest shareholding can also influence or control who is elected on to the committee of management.

There are also restrictions as to who can be appointed to the committee.

No person can be appointed to the committee who is or becomes:

• Mentally disordered
• An undischarged bankrupt
• A person convicted of an offence punishable by imprisonment for a term of six months or longer, unless he or she has served the sentence or suffered the penalty imposed

Points to consider in electing committee members are:

Term of committee member: The term of a committee member is normally three years. The shareholders may by special resolution, determine that the term of office of a member shall expire at a date that allows for rotation of the committee members.

At the first annual general meeting of shareholders the shareholders elect a committee of management.

Election to Committee

If you want to be elected to a committee, you need to make sure you fully understand the election timing and processes as set out in the Te Ture Whenua Act 1993 and the Māori Incorporation Constitution Regulations 1994.

More information for Māori Reservations

Appointment of Trustees

Trustees for Māori reservations are appointed by order of the Māori Land Court.

The trustees can be a body corporate such as a company, or an incorporated society, or two or more people.

The trustees hold office from the date specified in the relevant order of the Māori Land Court.

The term of the trustees' appointment is as set out in the trust order. In some orders the term will be open ended so that there is a need for people who are made trustees to be able to make a contribution for many years.

On being appointed the trustees are required to give notice of the appointment by public notice in the local newspaper and such other notice as the Māori Land Court may direct.

The Māori Land Court appoints new or additional trustees.

Tikanga and values

An understanding of history, tikanga and the cultural values relating to the hapu may be important to assessing candidates to be trustees. The appointment of trustees may be influenced by whakapapa or family connections to the reserve.