Thanks PE,"no vacancy' Legislation is of...

Thanks PE,

"no vacancy' Legislation is of interest.

http://www.theaustralian.com.au/business/directors-slam-proposed-no-vacancy-board-rule/story-e6frg8zx-1226048707353

This legislation (Commences June 2011 ?) has ruffled feathers, upsetting the 'boys club' mentality of some companies.

AUSTRALIA'S top company directors yesterday attacked federal government proposals to prevent companies from having vacancies on their boards.
The no-vacancy rule is being considered by federal parliament as part of legislation to set new rules on executive pay.

Representatives of the Australian Institute of Company said the rules could make it harder to appoint women to boards.

They would also make it harder for a chairman to carefully select a board's mix or to temporarily beef up numbers to allow newcomers time to get experience before experienced members retired.

"We really don't understand what this rule was meant to solve," Woolworths chairman James Strong said. "The legislation stops you ramping up the number of directors on the board in the short term, so you can overlap them with others who are scheduled to go out."

"This was what we were about to do on one of the boards I am on -- run up the numbers and overlap the newcomers with those who have done their time.

"I'm not too sure what we are able to do with this legislation. I don't understand how it works."

Mr Strong said he believed no company chairman or director was involved in the Productivity Commission review that led to the proposed changes.

Telstra chairman Catherine Livingstone said the legislation challenged the subtle process of building board skills.

"It belies the whole nuance around constructing a board and getting the right mix of skills and styles of people," she said.

"A board is not a loose association of individuals. Making it work is a delicate business."

United Group chairman Trevor Rowe said it was important to overlap directors to ease new directors into a board.

"It is the normal way you bring in someone fresh. You give them time to overlap," Mr Rowe said.

Association chief executive John Colvin said the legislation would make it harder to appoint women on boards as it did not allow any training period."