The Ruapehu Skifield Stakeholders Association have released their draft Governance Framework for the Ruapehu Skifields. The framework has been shared this week with PwC, MBIE and other key stakeholders.
The proposed structure offers a balanced approach to ensure the long-term sustainability of the skifields and protect the interests of all stakeholders. The proposed structure balances the three vital sources of cash needed to stabilise the skifields (customers, equity investment and debt providers) along with other key stakeholders such as the local community.
The 2 page proposal outline is available for download here:
Stakeholder Representation
Stakeholders Assocation:
Association protecting members interests in the long-term stability, transparency and good governance of the skifields.
NewCo will issue the RSSA with % of material or “golden shares” on incorporation. This is to prevent corporate takeovers and changes to the constitution.
Promotion of Life pass holder transfer fees into NewCo.
The Association to appoint 2 of NewCo directors.
The board representatives will host an annual meeting to provide updates on NewCo performance, hear feedback from members and vote to direct the board representatives
In addition to the elected board representees, there will also be a range of sub committees in the society to allow for diverse viewpoints, active participation.
Example participants would include (1) Leadership Committee, (2) Life pass Holders (3) Iwi, (4) Businesses, (5) Environmental etc. These participants would consult with relevant stakeholders and (through the Board Representatives) assist NewCo with special projects, advice and input.
Equity Crowdfunding Investors:
NewCo Ltd will issue general shares to raise capital to everyone.
General Shareholders do not attract dividends (but may be able to achieve a capital appreciation if the share price increases).
Likely to be mountain users, clubs, local business etc. who all rely on the industry.
General shareholders to appoint 3 of NewCo directors elected by vote at the NewCo AGM.
Bondholders:
Bondholders have no shares in NewCo unless they choose to via the equity crowd funding.
Bondholders to appoint 1 of NewCo directors.
Bondholders receive investment % return (coupons).
Provides ability to raise capital for major investments.
Current Bondholders include, Iwi investment companies, local trusts, councils and individuals.
Governance Structure
There are several elements of the proposed structure that are aimed at achieving a balance between stakeholders that ensures long-term stability, transparency and accountability.
Co-Operative Structure
The proposed co-operative structure has a higher multi-generational long-term survival rate than other business models. For example, some of the largest and longest surviving organisations in New Zealand are customer-owned or supplier-owned widely held co-operatives, such as Farmlands, Fonterra, and Southern Cross, some of which are over 100 years old. This structure will foster a back-to-basics focus that will prioritise the fundamentals of operating the skifields and ensure industry-expert thinking and quality leadership at a managerial level.
Stakeholder Representation
The co-operative structure will ensure that all stakeholder groups, including local community, businesses, mountain clubs, and general mountain users, are properly represented in the future. This approach will help ensure that no single shareholder group has total control over the operator(s), promote transparent governance, and allow for diverse viewpoints and active participation through sub-committees within the society.
Investment Ready
The proposed structure will provide the ability to raise capital for major investments through equity crowdfunding and bondholders. Bondholders will have the option to appoint one director and receive investment returns while ensuring that the profit is reinvested back into the ski fields to help reduce risk.
Transparency
The cooperative structure will be managed by a board of directors that will include representatives from various stakeholder groups. The board will host an annual meeting to provide updates on NewCo performance, hear feedback from members, and vote to direct the board representatives. This approach will ensure that the company is accountable and transparent to all stakeholders.
Long-Term Stability
The proposed structure will protect the long-term stability of the skifields and prevent corporate takeovers and changes to the constitution through the RSSA's ownership of a percentage of material or "golden shares" on incorporation.
Next Steps
The Governance Structure is part of the overall proposal from the RSSA to adopt a community-owned co-operative model for the skifields. You can read the proposal here:
The RSSA is a membership based incorporated society with members from the ski community, local community, regional tourism businesses and the wider mountain community. You can join the association here:
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