Michael Stiassny praises finance director jailing

Insolvency specialist Michael Stiassny has opened the Institute of Directors national conference in Auckland this morning by tipping his hat to a High Court judge who locked up the first finance company directors.

Mr Stiassny, a partner at KordaMentha and chairman of Vector, says it is a privilege to be the warm-up act to Justice Paul Heath,  whose 2011 Nathans Finance decision was considered the template for the string of finance company director trials in the two years since.

He hoped the business community appreciated what Justice Heath had done in setting the benchmark with that decision.

"History will show it was a landmark," Mr Stiassny says.

[Read what Justice Heath later told the audience about the decision here]

But he says the "foot has come off the pedal" in relation to litigation and chasing directors for malfeasance and that there will be few further cases brought against finance company directors.

By his calculations, the outlook was bleak for investors who have lost money in collapsed finance companies.

"After legal fees and receivers fees there will be very little, if any, that will make its way into the hands of depositors."

He added: "I think I can say that as a receiver."

On the topic of 'leadership and responsibility, Mr Stiassny summed up the role of a director in one maxim: To maximise the value for shareholders.

"That is all we need to think about.

"The days of the club are over. The winning team will be diverse, hard working and focused on one thing: The shareholder."

Mr Stiassny says diversity is an issue for boards. He sits on a few boards where there are no women directors and changing that picture wasn't easy.

"[Diversity] is logical and it sounds easy, but we are struggling. We need you all to help," he says.

The NZX will soon have a lot of listed companies with majority shareholders and that was something for directors to think about, as well greater numbers of international shareholders on share registries, he says.

Mr Stiassny was replaced as New Zealand Racing Board chairman last year, after he was brought in to clean up racing's tarnished image.

gbond@nbr.co.nz