But how they look isn't as important as how they make you feel. It's no understatement to say that home is the center of every Kiwi's life. And at Contact, we believe in advancing the quality of home life for all New Zealanders. We believe a well-heated, well-insulated home is a home you can relax in, rejuvenate in, thrive in. The kitchen is the heart of every home, where we can boil, bake, fry, grill, toast, roast, and whisk a smile onto the face of the whole family. Home is where we work, stream, connect, and communicate with the outside world. At Contact, we are always looking for new ways to help you save rather than spend more. And by home, we don't just mean your four walls, but Aotearoa, where we all call home.
That's why at Contact, we are committed to leading New Zealand into a better energy future through renewable energy sources, so we can protect future generations and create a better home. Because at Contact, we believe home is the most important place in the world.
Let me come home.
Contact. It's good to be home.
Let me come home.
Ē ngā mana, ē ngā reo, ē ngā rangatira maha. Tēnā koutou, tēnā koutou, katoa. Good morning, everyone, and welcome to Contact's Annual Shareholders' Meeting. My name is Rob McDonald, and I'm the Chair of Contact, the Contact Board. On behalf of the Contact Board and all of our people across Aotearoa, New Zealand, I would like to welcome you to the 2023 Annual Shareholders' Meeting. This meeting is being webcast for shareholders who have not been able to attend in person, and I also welcome those who are watching online. For those guests who are here in person, in the unlikely event of an emergency, if the fire alarm sounds, please follow the instructions of the venue staff and leave down the central fire exit stairwell, located opposite the conference office, to the hotel lobby and continue to the assembly point on Featherston Street.
In the event of an earthquake, please drop, cover, hold, and then follow the directions of the venue staff. As a quorum is present and due notice of this meeting has been given, I declare the meeting duly constituted and open for business. I'd like to introduce others with me on the stage. To my immediate right is our Chief Executive, Mike Fuge. Next to Mike is Rukumoana Schaafhausen, Sandra Dodds, Victoria Crone, John McDonald, and Elena Trout. Other members of the Contact senior leadership team are also here today, as well as representatives from the auditors, EY. As you will have noted, today's meeting started with a greeting from Rukumoana, followed by Contact's waiata, Mai i Runga , which is customarily sung to support the greeting.
We do this because it's important to acknowledge our relationship with our iwi stakeholders and the fact that we use New Zealand's natural resources to generate energy, of which our iwi partners have an interest in. Today's meeting will commence with addresses from me, as the chair, and from the Chief Executive, Mike Fuge. Following this, we will consider the financial statements, and there will be an opportunity for shareholders to ask questions they may have on the financial statements. We move on to the resolutions that are outlined in the notice of meeting. We have four resolutions to put to the meeting today, and these resolutions will be decided by taking a poll. There will be an opportunity for shareholders to ask questions relating to these resolutions and to raise any additional matters that shareholders wish to discuss. Please state your name before asking a question.
All shareholders participating online can ask questions during this meeting, and I would encourage you to send through your questions as soon as you can. This will allow us to answer these questions at an appropriate time in the meeting. To ask a question, click on the box that says "Ask a question," and follow the instructions on the screen. Please note, questions may be moderated, or if we receive multiple questions on the same topic, then they may be amalgamated together. If we can't answer a question in the meeting, we'll answer it in due course via email. I provide you with further instructions in relation to voting as we progress through the meeting. If you encounter any issues, please refer to the Virtual Annual Meeting Portal Guide, or you can phone the helpline on 0800 200 220. Let's get underway.
On behalf of the Contact Energy Board of Directors, I'm pleased to share reflections and observations on the past year, provide an update on our strategic ambition, and our views on the path ahead. A path that provides an opportunity for Contact to play an integral part in shaping the future of a truly electrified New Zealand. Sorry, the past year is best characterized by our ongoing investment in renewable generation, our commitment to decarbonize our portfolio, and our ongoing transformation of Contact to ensure that we are well positioned for the future. Sorry, before I start, I want to acknowledge and thank my fellow board members, our CEO, Mike Fuge, and the entire Contact team, who again have put in significant effort this year.
It has been a year of solid financial performance achieved in an environment that has included unprecedented weather events and New Zealand and international economic headwinds. In line with guidance, the company delivered an underlying EBITDA of NZD 573 million, and in the 2023 financial year, delivered investors an annual dividend of NZD 0.35 per share, in line with the 2022 financial year. Mike will take you through the financial results in more detail in his address. As Chair, I want to reiterate the commitment and focus on delivering Contact 26 strategy to build a better New Zealand by being a leader in the country's decarbonization. We're now in the third year of Contact 26 strategy. I'm pleased to say that Contact is delivering against this strategy.
Our focus on execution, on operational excellence supports not only our solid performance in the past year, but also sets Contact up strongly for future growth. Highlights of the year include the NZD 1.2 billion of renewable generation developments at Tauhara and Te Huka 3, currently under construction. Contact's pioneering energy agreement with industrial giant, New Zealand Steel, which will remove 1% of New Zealand's emissions, and we accelerated our ambition to decarbonize Contact's portfolio. We now have a clear path and are committed to net zero emissions from our generation portfolio by 2035. We also have a significant and well-progressed pipeline of renewable development projects across geothermal, wind, solar, and grid-scale batteries, which, subject to final investment decisions and appropriate market conditions, we intend to progress further in the next 12 months.
This month, we updated the market that the online date for Tauhara is moving from the first quarter of 2024 to the third quarter of 2024. Tauhara, near Taupō, is a nationally significant renewable energy project, which will have a substantial impact on the country's transition to electrification. Tauhara is an important development for both Contact and the country. Tauhara was more than a decade in the planning stages, so it stands to reason, as we work through the stages of commissioning, we take a prudent and pragmatic approach to coming online. As with all projects of this magnitude and complexity, the final stages and commissioning is complex. The board has full trust and confidence in the team that they will deliver. The independent Boston Consulting Group report, The Future is Electric, was released in 2022.
We were a large part of the large stakeholder group, including gen tailers and major distribution companies, who commissioned this important analysis. BCG identified the significant level of investment across generation, distribution, and transmission required to both decarbonize the energy sector and to support the broader decarbonization of the economy through electrification. Prudent investment in new generation requires reasonable investment certainty, certainty of government policy, and certainty the government will not crowd out private sector investment and allow for infrastructure to flow. We're optimistic, given the signals from the incoming government, that the pathways for investment and subsequent decarbonization of our economy for the good of New Zealand and the planet will be clear. We have been concerned about the impact of the proposed battery project at Lake Onslow that was intended to address dry year risk.
I'm pleased that the parties involved in the incoming government have indicated they intend to shelve the ongoing work on Lake Onslow. It will be a sound decision to cancel ongoing evaluation of a speculative, risky, and extremely expensive venture that continued to undermine certainty in the market, a condition necessary for accelerated investment in renewable generation by the private sector.... However, as we transition to decarbonize the energy sector, the issue of dry year risk has not disappeared. There will be renewable projects in development across the industry that will materially reduce the risk over time. We remain of the view that Lake Onslow was not the solution. There is now further opportunity and a positive emphasis for the industry and government to work together to find a practical and affordable dry year risk solution for the good of the country.
The BCG report also highlighted that current regulatory settings for both transmission and lines companies may not be consistent with or appropriately support the significant investment required to transition to a renewable energy future. The incoming government will need to focus on supporting appropriate regulation for transmission and distribution to ensure that the investment is realized. The current regulatory framework is not fit for purpose. The government needs to work quickly and effectively to develop a new framework to enable investment in those areas if we are to achieve New Zealand's carbon reduction targets in the coming decades. Contact plays an important role in supporting New Zealand industry to decarbonize and help build and contribute to a healthier economy. The New Zealand Aluminium Smelter continues to indicate a desire to maintain operations at Tiwai Point beyond 2024.
The smelter is valuable to our country and our economy, particularly as a significant exporter. It is also highly carbon efficient in its production of premium aluminum, as well as a major contributor to the Southland economy. The New Zealand Aluminium Smelter has also signaled that the smelter can play a key role in addressing dry year risk through demand response. We believe that the fundamentals for green and high purity aluminum production at Tiwai remain strong. We have played our part in supporting an extension. It is now up to others. It would be a travesty if the parties could not reach a satisfactory agreement that gave certainty to the people of Southland and to the New Zealand economy. Finally, I would like to finish by thanking long-serving director, Vic Crone, for her eight years of service with Contact.
Vic, who has also served on the Audit and Risk Committee, is retiring from Contact this month to pursue new endeavors. We appreciate the expertise, and insights, and guidance that Vic has shared during her time with us, and wish her all the best. I'd now like to present a small gift to Vic, and let me just tell you what... This is a stylized taniwha with a manaia on top. The manaia is a guardian figure linked to your future and taking the ethos of ma taniwha with you and but guided and protected by your past life and people. The pounamu is Kokopu, a rare type of stone, not often seen. It is a strong piece and so are you. I'll now hand over to Mike.
Tēnā koutou, tēnā koutou, tēnā tātou katoa. Ngā mihi nui ki a tātou katoa. Ko Mike Fuge ahau te kauwaka here i te ata mātahi ko. Tēnā koutou, tēnā koutou, tēnā tātou katoa. Good morning, I'm Mike Fuge, the Chief Executive of Contact Energy, and you are very welcome here this morning. Today, I do want to share my reflections on the last 12 months with you, what we as a company have achieved, what we have learned, and what we have in front of us. We're now into the third year, as Rob said, of our Contact 26 strategy, with a vision to build a better Aotearoa by leading the decarbonization of our country, the place we all call home. Our strategy remains to grow demand, grow renewable development, decarbonize our portfolio, and to create outstanding customer experiences. This strategy remains sound.
It is delivering on our strong commitment to decarbonize, to invest, to grow, and deliver shareholder value. We're now deep into execution mode, in what has been a year that has been characterized by significant investment, continued transformation, and demonstrable progress against this strategy. As Contact transforms and grows, we remain focused on operational excellence, using the learning from this period of transformation and change and expansion to continuously improve the execution of our strategy. I am, as CEO, incredibly proud of the 1,200 people that work for Contact and the Contact team, and what they have achieved. They are a team of dedicated professionals, who every workday, come to work passionate about the part they play individually in helping us reach our goal of net zero from our generation activities by 2035. But more on net zero later.
In terms of business and financial performance, looking at our achievements in the last financial year, our business underlying performance has remained resilient in a volatile environment. We have delivered a solid financial performance with underlying EBITDAF growth to NZD 573 million, a 5% increase from the previous year. Contact's profit after tax was NZD 127 million. This included an onerous contract provision for the Āwharangi gas storage facility, and on an underlying basis, our profit was NZD 211 million. This solid performance was delivered despite soft short-term wholesale market conditions, the highest hydro inflows in post-market history, and the North Island's rainfall being the highest on record. For those who live in Auckland will know it well.
This resulted in lower spot market prices and saw spot prices actually separate between the North and South Islands. We responded to these conditions by reducing our thermal generation to the lowest in Contact's history. This decision bore good financial results and lowered our greenhouse carbon emissions. We continue to carefully manage our existing operations to optimize our performance, while focusing on investment in renewable generation and innovation, and decarbonizing their portfolio. This includes the NZD 1.2 billion of construction and commissioning currently underway. A very strong pipeline of potential geothermal, wind, solar, and battery investments, the measured retirement of thermal generation, and investment in digital innovation in retail and the generation arms of the business. As the benefits of this investment is realized, we anticipate a sustained uplift in earnings and shareholder returns and cash flow in future years to come.
Our FY 2024 normalized and expected EBITDAF guidance of NZD 600 million remains in place. In terms of growing demand, demand for our renewable energy is very strong. Our watershed moment came in May, when we announced a pioneering energy agreement with the industrial giant, New Zealand Steel. We will provide 30 megawatts of energy for its new NZD 300 million electric arc furnace in a unique arrangement that will enable this industry leader to scale down production in peak demand time or supply shortages. This flexible peak/off-peak feature is also a part of a significant step towards meeting New Zealand's climate change goals, and once in operation, this feature will remove 800,000 tons of greenhouse gas emissions annually. This is the same as taking 300,000 cars off the road permanently, or 1% of New Zealand's total emissions.
It is an outstanding example of how we, in industry, with smart thinking and a partnership mindset, can work together for the good of the planet and of the Māori. The trend continues with accelerating opportunities, with other industrial companies exploring similar opportunities to decarbonize industrial heat processes and cut their fossil fuel use. And so to Tiwai. We believe strongly that decarbonization of our economy should not mean the de-industrialization of our country. As Rob has said, the New Zealand aluminum smelter at Tiwai is valuable to our economy. It is a significant exporter and a major employer and contributor to the Southland economy. Contact has provided Tiwai with commercial terms for a long-term agreement to support a tranche of its electricity requirements.
Like New Zealand Steel, demand response opportunities at Tiwai offer an opportunity to support New Zealand's energy security, with the ability to scale down production, if required, in the event of supply shortages and peak demand. It is time we all moved forward from talking and got this settled. In terms of renewable development, I do want to give you an update on our NZD 1.2 billion of renewable generation sites currently under construction, along with an update on our pipeline of potential geothermal, wind, solar, and battery investments. As we go on a journey of decarbonization and to make a real difference to the world in which we live, we're going to have some tough experiences. Being a leader is bold, and at times you have to pause and regroup in order to move forward.
As history shows continuously, there are challenges and opportunities whenever there is a big change. Stopping or ignoring the challenges of climate change is simply not an option. To improve the outcomes for New Zealand and to play our part in the company's-- country's future electric demands requires grit, determination, and focus. We play the long game in leaving our legacy for good, a legacy for future generations. We have announced that Tauhara and Taupō is now expected to come online in quarter 3, 2024, delayed from quarter 1, 2024. Building a geothermal plant is complex. We're working through a range of commissioning issues at the development, including the remediation of underperforming steam field valves and liquid handling systems, as well as the implications of a related steam hammer event.
Given the range of commissioning issues identified, some elements of the steam separation plant will require further design and modification, which are underway. It is because of this, that the timeline has been impacted. With the expectation to have the plant online in quarter three, this will be at least at the initial design capacity of 152 megawatts, and we're targeting the full planned outage of 170 megawatts by the time Tauhara's first statutory outage is planned, following further optimization and plant modifications. This is not the outcome we were targeting when we started commissioning. The commissioning stage in any geothermal project is when unknowns such as this are brought to the fore, and we can apply mitigations.
The on-site team are expert in major infrastructure and geothermal developments, and are focused on minimizing this delay while ensuring the highest standards of process safety first on this asset, Tauhara, that will serve future generations. It is in the major projects team, created by us to support our execution mode, that we have built the in-house expertise, so we can troubleshoot these issues in real time and without delay for the best possible outcome. Tauhara remains a standout renewable energy project that will be a fantastic long-term asset for New Zealand and Contact Energy. Contact knows the importance to New Zealand of quality infrastructure and rebuilding in this executional capability. In line with international best practices, we have stronger processes for front-end design.
We are now applying modern digital design tools and have significantly bolstered our in-house capability and capacity with the setting up of the major projects division, led by Jack Ariel, who himself has significant depth of developing large infrastructure programs internationally. Our second project, Te Huka 3, is now more than 66% complete. It is ahead of schedule and with all major equipment now here in New Zealand or in transit. Te Huka 3, next to our existing Te Huka geothermal station, will be a single unit binary plant at 51.4 megawatts, with carbon capture capability from the very first day. Once operational, it will produce clean, renewable electricity that will operate 24/7, and in common with all geothermal generation, is not reliant on the weather.
Our Geofuture project, while subject to a final investment decision, will see us replace the original Wairakei geothermal plant commissioned in 1958, and move existing operations away from the Waikato River, increasing the efficiency and generation capacity from the Waikato—from the Wairakei geothermal source. After a comprehensive and long engagement with the local community in Tangata Whenua, we received consent to operate for the next 35 years on the Wairakei steam field. As part of our commitment to reducing and mitigating the impacts on the environment, we are reducing significant our impacts on local waterways. Through Geofuture, we will be able to stop all operational discharge of geothermal and cooling white water into the Waikato River.
We are confident that of the lessons that we have learned and the changes made since we made Tauhara's final investment decision, which we have started applying with Te Huka 3, and we have very much applied for Geofuture to ensure much improved performance in the future. This learning will also apply to our proposed wind, solar, industrial, grid-scale batteries. We will ensure the business cases and market conditions are absolutely right for the final investment decisions for these projects. For our customers, we have worked hard to ensure it's good to be home for New Zealanders in our retail business. We're stepping beyond the big stuff to help everyday Kiwi homes decarbonize, and it's working. The FY 2023 year saw us finish with over 589,000 customer connections, with a net back growth of 11% on the previous year.
Connection growth continues to increase with, as of this month, total customer connections is just shy of 600,000. Also growing is the uptake of innovative products to help Kiwis lower their carbon emissions by making a small change to their own behavior. More than 66,000 customers are now using either our Good Night Plan, where electricity is free between 9:00 P.M. and midnight, or the Green Charge Plan, which gives EV owners cheaper rates between 11:00 P.M. and 7:00 A.M. So far, 84 million hours of free off-peak time has been used by Kiwis choosing these products. Next month, Good Weekend launches, incentivizing our customers to use weekend off-peak energy, further reducing the need to use gas or other fossil fuels at peak times. Our brand tracking research shows that we are second equal for brand trust among New Zealand energy providers.
Our Net Promoter Score, the number of customers who say they'd recommend us versus those who would not, increased again this year from +39 to +41. 66% of customers say Contact is easy to deal with. And so that turns to our legacy for good. As a company, we are an integral part of the daily life in New Zealand, and we're acutely aware that our every action, good and, and bad, has a marked impact on the well-being of our community, today and in the future. This was acknowledged in December 2022, when we joined the Dow Jones Sustainability Asia Pacific Index, achieving the second highest ranking of any New Zealand company. We are delighted to be ranked among the best.
It reflects where we are and assumes that people are appreciative of businesses that put words into actions rather than just talk about ambition. This year, we took the step of accelerating our ambitions to decarbonize our own portfolio. We now have a clear path to achieve net zero emissions from our generation operations by 2035. The focus on an orderly transition to renewable energy generation, to retire baseline gas generation, and to invest and innovate to support the eventual retirement of our peaking plant, along with targeted sustainable forestry investments, has given us the confidence and a clear pathway to commit to net zero for our generation operations by 2035. It takes courage to take steps forward and to improve the outcomes for communities and for people.
As we go on our decarbonization journey and commit to making a difference, we're gonna have some tough experiences, but fundamentally, this is the right thing to do. Decarbonization is our legacy for good.
Thank you, Mike. We now move to a discussion on Contact's financial statements. The financial statements for Contact for the year ending 30 June 2023 were released to the market on 14 August and are set out in the integrated report, which is available on our website. I'd now like to open the floor for any questions you may have, specifically on Contact's annual financial statements. EY Audit partners are present at the meeting. Should any shareholders have any questions for them. There will be plenty of time later for questions that might be more of a general nature. We have microphones available. If you wish to speak, please put your hand up and wait for the microphone to be brought to you, so we may all hear your question. Are there any questions on financial statements?
Alistair Duncan, shareholder and customer. Not always the same thing. I have a series of questions, which I also want to foreshadow one for our board members who are standing. So with your permission, could I foreshadow that so they can think what their answer is?
Sure.
The question is: What steps will you take to enable Contact to become a living wage employer if you're reelected? I suspect you know the results of your election already. My question more generally is, however, about the human capital, and I want to congratulate those who prepared the annual report and yourself on the presentation that talked about environment. The other measure of a business is the way it treats its people, and if you make it through to page 65 of the annual report, there is a deeply disturbing set of data, and it's about the gender pay gap, which is appalling. It is the best part of 45%, the gap between what the notional male earns and the notional female.
If I look at the annual report, it tells me that 703 of our hardworking, executive and tradespeople earn more than NZD 100,000. That leaves the best part of 600 people earning considerably less. Two things: One, can we get some data on how that breaks down by gender and ethnicity? There is some ethnicity data in the report, but not related to salary. And secondly, can we reconcile the data on page 79 that talks about the Chief Executive's remuneration as being 24 times that of the notional employee? Chief Executive, works hard for NZD 1 million. The notional employee, divided by 24, works hard for NZD 44,000. Hence my question, in advance to those standing for the board. The measure of businesses is increasingly human capital and the environment.
Congratulations on the foreshadowed work you do about the environment, but I would take odds with you on the long-term viability of Comalco, which we, as shareholders and taxpayers, have underwritten ghastly for far too long. So those are my comments, but if it is possible, you've got a lot of staff here, so somebody to do some work during the course of the meeting and come back to us on the, particularly the gender pay, but also in due course, the ethnic spread. Those are the measures of businesses that are doing the hard mahi but are also delivering. Thank you.
Mr. Duncan, we will take those questions on board now, but I'll, I think it's best we answer them actually when we come to general questions, 'cause the questions for now relate to the financial statements.
But the salary is a component to a part.
Sure. But they're disclosed in other pages. So, are there any questions on the financial statements?
Jenny Miller, shareholder. I've got a question on the Tauhara project. Is it okay to raise that now?
It would be better if we raise that in general questions. So we're just at the moment looking at the financial statements. We'll come to that shortly Paul Murray, I'm shareholder. That NZD 84 million, onerous contract, and that you had to write off-
Onerous contract. Yes.
Yeah, onerous was the word. I can't actually put my finger on it, but I have a feeling that we've done that before. And, there's been a couple of other times over the years when Contact has had to actually drop off huge amounts and write off huge amounts. And one of the things I was thinking about with regard to that is the wind farm development-
... Going to be done at, around the Dannevirke area, which seemed to get caught. So is this failure of the management or is it just, unavoidable, and can we avoid it?
I think I'd firstly say we both would like and hope we can avoid it, but inevitably, some of these things come up. The wind farm at Dannevirke precedes my time, which is sort of eight years. So, I can't answer that, but I'm assuming that would have been written off at the time. This is the first time in my memory of being at Contact, we have had an onerous contract, of that similar or an amount of this size. And it's obviously, obviously a disappointment, but, and there's undoubtedly lessons here for us as we look to have others operate what were formerly our assets. And that's not a criticism of how it's operated, but, it simply means you're not in control.
From that perspective, this, the mode of operation, the things that have occurred and predated the sale and leaseback as well, and not known to us, have meant that subsequently it hasn't performed at the level. It's improving now. We felt, given the sort of need we have for gas going forward, particularly as TCC comes out, that it was appropriate that an onerous contract provision was made. Mike, I'll get you just to comment more on any specifics around AGS.
Yeah, look, the key in AGS was that, from a perspective of technical performance, the reservoir did experience some water ingress, which led to suboptimal performance. The approach we've taken was, number one, to be entirely transparent about what is happening, to make sure we assemble some of the best experts in reservoir management in Australasia to understand what's happening. The joint team had a clear way forward, but the write-off on the performance of the asset, in terms of the contract, was part of that process of just getting a good understanding of what's happening.
Okay. Are there any other questions? That would be better. Yeah, it's more of a general nature. Okay. Any other questions on the financial statements? Otherwise, are there any questions online? There doesn't appear to be so. If there are no more questions, we'll move to the formal resolutions of the meeting. These are outlined in the notice of meeting sent to all shareholders in October. Voting on the resolutions will be by poll. Each resolution will be put to the meeting, with the proxy voting results displayed on the screens.
For those of you who are here with us in Wellington, you'll be able to cast your vote by filling out the form that you've brought with you or received at the registration desk on the way in, and which will be collected at the end of the formal part of the meeting. If you're a shareholder and did not register on arrival and wish to vote, please make your way to the registration desk just outside the room and staff from Link will assist you. If you're both a shareholder and a proxyholder or a shareholder company representative or have more than one holding, you would have received a separate voting card for each holding. When you vote on the resolutions, please complete all voting cards given to you at registration.
For those attending the meeting online, to vote, you will need to click "Get Voting Card" within the online meeting platform. You will be asked to enter your shareholder or proxy number to validate. Please then mark your voting card in the way you wish to vote by clicking For, Against, or Abstain on the voting card. Once you have made your selection, please click Submit Vote on the bottom of the card to lodge your vote. Please refer to the virtual meeting online portal guide, or use the helpline specified if you require assistance. Voting will remain open until five minutes after the conclusion of the meeting.
Each resolution set out in the Notice of Meeting is to be considered as an ordinary resolution and as such, must be approved by a simple majority of the votes cast by the shareholders entitled to vote and voting on the resolution. Because the first resolution concerns my re-election as a director, I will vacate the chair, and Sandra Dodds will assume the position of chair of the meeting while my appointment is being considered and the resolution voted on.
Thank you, Rob. It's my pleasure to move that Robert McDonald be re-elected as a director of Contact. Rob was first appointed to the Contact board in November 2015 and has been the board chair since 2018, and is also a member of the People Committee. A brief biography of Rob is set out in the notice of meeting.
... The board unanimously recommends that shareholders vote in favor of this reelection. I'd now like to invite Rob to speak in support of his reelection.
Thank you, Sandra. I'm honored to have this opportunity to continue my involvement with Contact Energy and stand for reelection to the board of directors. I'm passionate about making a contribution to one of New Zealand's most important companies, and to play my part in leading the decarbonization of the sector, as well as support the broader decarbonization of the economy through electrification. I've been a director of Contact since 2015 and was last reelected in 2021. To me, it is clear Contact's job is an important one. The past year has been one of unprecedented investment and transformation as we remain committed and focused on Contact 26 strategy. As we lead the transformation at the time of significant growth, we need leadership to continue that course, and for that, as chair of Contact, I'm 100% committed.
I bring a diverse set of skills to the board by having held senior management positions, all of which have focused on business, finance, and strategic planning. I have more than 40 years of business experience in New Zealand and overseas, including 25 years at Air New Zealand, 14 of which were as Chief Financial Officer. I have a good balance of governance roles and believe I manage that well to avoid overcommitting. I'm a director of Fletcher Building and Chartered Accountants Australia and New Zealand. Upon conclusion of my term in June 2024, I'll retire from Chartered Accountants. I was very recently appointed to ASX-listed company, FleetPartners. In my mind, I see the role as providing Contact's CEO and leadership team with guidance, support, and strategic advice, and the chair is a bridge between executive management and the board.
The role of the chair is also to create robust and constructive discussions and challenge between board and leadership team to enable Contact to thrive and succeed, and most importantly, to deliver to shareholders. For the next three years, I want to continue building and developing to the future we have set, and to ensure when I step down, as this will be my last term, there will be a seamless transition. Thank you for your continued support.
Rob, did you have an answer to my question, please?
Well, do that. Questions.
Thank you very much. Looking forward to it.
Thank you, Rob. Now I'm going to open the floor for any questions. So
Apologies from the afternoon.
No, no problem at all.
Could you repeat the question again?
Yeah, I certainly will, and assist your colleagues with the question. Assuming you're reelected, I suspect that the results are close, what steps will you take to ensure that Contact becomes an accredited living wage employer?
Well, I mean, we do pay the living wage.
Yeah. In terms of practical outcomes, all our staff are above the living wage. We don't commit to be a living wage employer because it's almost semantics, but we can, all our staff... Yeah.
Could you explain? Well, since you've answered, what do you mean by semantics?
Well, in terms of the public commitment, we pay our people a market rate. They're highly skilled. We aim to retain them. That's-
Not on your latest job advertising. You're advertising customer roles at NZD 44,000. That's less than the living wage.
We don't believe that is less than the living wage.
Giving us an assurance now, publicly, that the business pays the living wage to all staff. Is that correct?
That is our understanding, yes.
We said last year, we'll review it if it's not-
So last year you did. Would you make a commitment to ensure you continue that, and will you give consideration to-
Well, we'll see where we are.
Could I, could I finish my question, please? And will you make a commitment as a candidate seeking my vote today to consider accreditation? That's all right. You're not going to vote either way.
It's a question. The issue is, and I'm going to come to this, we can talk about words, or we do action, and so I'm happy to-
Accreditation would be an action.
Yeah, but it's in some respects-
Yes or no answer.
It's words.
Would you make a commitment?
I don't really want to get into an argument because-
Standing for office, a yes, no answer is appropriate.
We will look at what we think is the appropriate market.
Not we, you. You are the only person standing right now. What's your position to assist us vote?
My position is the company will look at the relevant market circumstances at the time.
Oh, agreed. Thank you.
Do you have any other questions?
Any other questions?
Two at the back there. Just, just wait for the microphone so everyone can hear. Thank you.
I noticed in your précis of the job role as chairman of the board, there was nowhere you were providing guidance to the business. As the chairman of the board, who represents us shareholders, surely some of your job is to actually direct the business in what sort of form it wants to go?
... I would sort of describe and the comments I made at the end of my speech. Ultimately, all directors are individuals, and they come with different views to the board. But we try to act as a team, and give that guidance and sometimes direction to the leadership team. But ultimately it is the leadership team that brings forward a strategy, and that's reviewed, commented on, discussed, and often views and directions given and modifications made. So it becomes... The board environment is a very collaborative team environment, but individuals bring their own views and thoughts. To sort of characterize the chairman as being directive, I think, in my view, would be a wrong characterization.
If on occasions the board gives strong views to the management, I, you know, you could characterize those as directive if you, if you wanted to. I don't see it that way, but it is very much, as I say, collaborative and a team environment.
Okay, and there's another question from the floor. Just... Thank you.
Yeah. Andy Leslie, shareholder as well. The notice says that you were last elected in 2020, and if I heard it right, you said 2021. So just purely clarification, please.
Sorry, could you say it again?
The notice says you were last elected in 2020, and if I heard you correctly, you said 2021. So just purely clarification, please.
It was 2020. Sorry, it was three years ago. Yeah.
Are there any further questions from the floor? Yes, two.
Gentleman shareholder. Last year in Auckland, Mr. McDonald, you gave me an assurance that you would not... So honesty and integrity as part of being a director, you gave an undertaking that you would not be using auditors for other work, and you've actually gone back on that. And I'm disappointed, especially when you were so angry at me. So, have you got any comments on that? Because at this stage, I want to vote against you as a director.
Yeah. So, firstly, I'm disappointed you thought I was angry at you. But, in terms of the auditors, a couple of things here. With the auditors, we transitioned, this is EY's first year, so there's some residual from the past with EY. It's, strictly speaking, the sort of, you know, key disclosure is over the financial statements assurance. What you will see at Contact and many other companies in New Zealand is that, that non-financial statement assurance is going to grow, and it's gonna grow because, we will be looking to our auditors to do more assurance, as required under the climate standards that come. So there will be more assurance of non-financial data. I still see that very much as, as assurance, and they remain, their independence remains.
The only other thing going on with, I think, EY was some salary survey data, which is sort of past history as well.
It's disappointing.
Are there any further questions? If not, we'll ask, are there any questions from online? No, there's no further questions. I would now ask you to please complete your voting card beside Resolution 1. Please either vote for, against, or abstain in the appropriate place on the voting card. Thank you.
Thank you, Sandra. Our second resolution today relates to the re-election of another existing director. It is now my pleasure to move Rukumoana Schaafhausen be re-elected as a director of Contact. Rukumoana joined the board in March 2021. She is a member of the Audit and Risk Committee and the Health and Safety and Environment Committee. A brief biography of Rukumoana is set out in the notice of meeting. The board unanimously recommends that shareholders vote in favor of her re-election. We will now hear from Rukumoana.
Thank you for the opportunity to talk with you today. I am also seeking re-election as a director of Contact Energy. I want to do all that I can to continue to serve Contact's vision, to help build a better Aotearoa through leadership in New Zealand's decarbonization, as you have heard. As an organization, Contact is working hard to keep pace with the communities in which we operate. I believe Contact's vision means being a good kaitiaki, a good steward.... of the environment, helping our communities to thrive by being a good neighbor and by creating collaborative, respectful partnerships with Tangata Whenua. I will continue to bring that voice to the Contact board table.
My governance of more than 25 years spans iwi, public, and private sector boards, and continues to position me to make a strong contribution to the strategic direction of Contact, as outlined in the Contact 26 strategy. The electricity sector has many complex challenges: balancing security of supply and affordability, investing in renewable energy, reducing reliance on fossil fuels, and that is just a glimpse of the intricacies of the industry. The role of leadership is more important than ever. As a board, we must be agile, informed, and open to collaboration, taking the time to understand our stakeholders. We need to co-create strategies with our stakeholders to ensure we are well-equipped for the future, a future we can all thrive and flourish. Meaningful dialogue at the board table also means looking into and examining what it takes to deliver and take action on authentic environmental, social, and governance matters.
Energy companies are the social and economic heartbeat of our communities, and we must continue to give confidence to our investors and shareholders regarding sustainability, diversity, and inclusion. I am proud to have served on the Contact board the past two years, and on your behalf, I look forward to contributing to the long-term vision of the organization, the sector's future, and the communities in which we operate. And, perhaps if I can just respond, Mr. Duncan, thank you for your question, and it's a very important question. And I can assure you that it is this board's commitment, and our chairman, that we look after our people. As you've heard, we're not an accredited employer. However, we always aim to pay at or above the living wage.
So my commitment to you is, today, to ensure that if that ever changed, where we're not paying at or above, I will, I will personally follow up. Thank you. Kia ora.
Thank you, Rukumoana. I now invite discussion on the resolution. Are there any questions that shareholders, present or online, would like to ask Rukumoana? Okay, there doesn't appear to be any questions. Please now complete your voting card besides Resolution Two. Please indicate your vote by marking either for, against, or abstain, in the appropriate place on the voting card. Our third resolution today also relates to the re-election of an existing director. It is my pleasure to move that David Small be re-elected as a director of Contact. David joined the board in October 2018. He is a member of the Health, Safety, and Environment Committee. A brief biography for David is set out in the notice of meeting. The board unanimously recommends that shareholders vote in favor of his re-election.
Unfortunately, David has tested positive for COVID-19 and is in isolation this week, so he's unable to be here in person. David has dialed in to attend the meeting and has recorded his re-election speech via video, which we will watch now.
Kia ora katoa. Thank you for the opportunity to speak before you today. It is a privilege to serve you on the board of directors of Contact, a role to which I was first appointed in 2018. The energy sector is going through enormous change, and the challenges and opportunities before us are significant for all New Zealanders. The energy sector has a central part to play in combating the effects of climate change. I'm fully committed to Contact's vision to be a leader in decarbonization, while also contributing to security of supply and energy prices that remain affordable. In my role as a member of the board, I bring long experience of working in and with the energy sector, and of the interface between government policy and regulatory settings, and the commercial pursuit of profitable opportunities.
I've worked on the design and regulation of electricity markets and on the development and evaluation of major energy sector investments. I understand infrastructure more broadly and the wider energy sector from my years working within the sector in New Zealand, the United Kingdom, and across several markets in Europe. I also have extensive experience in economic and environmental policy and regulation, which continue to be significant influences on the sector. As the founding chief executive for the Ministry of Business, Innovation and Employment, I led the merger of four organizations, building a high-performing culture and integrating the services the government provides to business. I have a long history with Contact and was part of the team that established the company in 1995 and 1996. This gives me an insight into Contact's heritage and history, our progress, and our continued journey on the path to decarbonization.
I would very much welcome the opportunity to be part of Contact's future as a member of the board and to continue to build on the work we have done so far. Thank you. Ma te wa.
... Discussion on the resolution, as David is unable to attend the meeting in person today, I'm happy to answer any questions on his behalf. Are there any questions that shareholders present and online would like to ask David?
Can we have my question?
Thank you. Yes.
Does David have a report?
No, he clearly doesn't, but we'll take that question on board. Yes, I will. Please now complete your voting card beside resolution three. Please indicate your vote by marking either for, against, or abstain in the appropriate place on the voting card. The last resolution to be considered relates to the auditor. I now move that the directors be authorized to fix the fees and expenses of the auditor. EY is Contact's auditor. The resolution proposes that the auditor be authorized to fix the remuneration of the auditor, which is the conventional practice for New Zealand-listed companies. It reflects the fact that the next level of the auditor workload, and therefore fee, may need to change from time to time to take account of the changes in the company's size or complexity, or changes in the law. I now invite discussion on the resolution.
Are there any questions? There doesn't appear any questions. Please now complete your voting card. Sorry.
Jenny again. With the introduction of the climate change reporting that's coming in, and I know Mercury's increased their annual report significantly. What impact is it going to have, and what costs do they expect currently to bring it into the global standard?
So I mean, that's not a question on the audit fees, but I, I will actually answer it here. So the, the issue is that New Zealand climate standards are not worldwide standards. They are standards for New Zealand, and they come in, in this current period. We will have a limited assurance of those as, as we did last year, and then ultimately, over time, they go to a full assurance of, Scope one and two. That will, I expect, over time, will increase both the scope but also the fee size for the assurance of the non-financial data.
Currently at 100,000, based on these reports in here.
Yeah.
So do you expect it to double or?
I have-
No idea.
I don't want to do a negotiation in front of EY. I guess it's a limited assurance. We'll have to go to a full assurance over time. Are there any other questions? No? Good. Okay, please now complete your voting card. Besides resolution 4, please indicate your vote by either marking for, against, or abstain in the appropriate place on the voting card. Have all those that wished to vote, voted? It would appear so. Link Market Services will now collect your voting papers. Please place your voting paper in the ballot boxes as they are passed around. Shareholders participating via the virtual meeting website should now submit their votes online. The meeting will remain open until 5 minutes after the conclusion of the meeting.
Sorry, I might have misheard you. I thought you said we had till five minutes after the conclusion of the meeting to vote.
Online.
Oh, okay. Thank you.
It's yes, so you put your voting in now.
Discretion, what do you actually mean?
Um-
Please.
That is a good question.
Open vote.
Oh, sorry. That was open for the directors to vote as they saw fit. So you can assume that's positive. Okay. For the information of shareholders, here are the proxy votes received for the four resolutions. The votes will be counted, and the results announced to the NZX and ASX this afternoon. We now move to the fun part of the business, the general business. This is your opportunity to discuss anything we have not already covered or ask questions of the board or management team. Does anyone present or online have a question? I will go straight to this issue of gender pay, the pay question. The gender pay gap is not where we want it, but it's important to understand its context. And its context is very much a function of the history of Contact....
In generation, we have highly technical roles and with long-tenured employees, where we have more males than females. Conversely, in the retail call center area, we predominantly have female employees who are on much lower salaries and, and there is higher turnover than generation. The point I want to make there is, I look at our contact centers, and I think they are an important part of the company. Many companies would take their contact centers overseas, and that would certainly solve a bit of our problem. We believe we provide into Levin and Dunedin an economic contribution that wouldn't otherwise be there. So it is important to understand the historical context in that.
Equally, we have spent a lot of energy and time to change the gender balance in generation and are making good progress there. And are quite pleased with the sort of talent, and particularly female talent, coming both into the hydro, but also particularly to the geothermal. So if you go to the geothermal team in Taupō, you will see some highly qualified, very specialized, and very talented females, and we're very proud of that. If you look at similar role pay, and that's where we put in a grade, and say a like for like role, it's 98% similar. And that 2% is largely an experience thing which is now closing. So I hope that answers that question. So let's go to the floor. Is there any general questions?
I have a supplementary question, having received your information. Thank you. You've identified that jobs largely done by men are paid significantly more than jobs largely done by women. You've talked in the document about remuneration measures. Have you conducted internally a gender neutral job evaluation so that whether it is men or women dominant in the call center, they're paid a decent salary? Because at the moment-
Right.
-they're not.
Well, that's your view.
Well-
and that is-
It's 24, 1/24 of what we pay the Chief Executive. When I ring someone on the phone, they're the most important to me as a customer.
Yes, and I appreciate that. So just so we're clear,
The simple question, have you conducted a gender neutral job evaluation?
Well, I would put to you the gender neutral job evaluation is what I just said. The gender equity pay gap is 98%. So, you know, it is for like for like jobs.
That is not the legal definition for pay equity. Jobs largely done by women compared to jobs largely done by men. That's my question. You'll have a bunch of HR people-
All right.
who know exactly what I'm talking about. Could you find out and come back to me so we don't continue this back and forth?
Well, the point I'd put to you is that we are now there is a greater flow of women, of females into the generation area where the higher paid jobs are. And that's something we are current-
It is.
We can't solve these things overnight.
You're missing the point entirely. Clearly, I'm not explaining it well. We have an act that says jobs largely done by men can be compared to jobs largely done by women to determine skill, effort, responsibility, and working conditions. Those of us who've seen the work done in health, have seen nurses get significant pay rises as a result of gender equity job comparisons. Have you done one? Simple question.
Everyone is clear in the room and that we don't have misleading information.
It's a backhanded slight. I object to that, and I invite you to withdraw.
No. So our jobs are sized on the role and not gender. And I have daughters, and I know the challenges we have of encouraging and retaining females in STEM-related jobs. They are, by their nature, higher paying. I have engineers on Tauhara, who in a year and a half have got over two decades of experience, and we will fight to retain them. Our starting salary in the call centers is NZD 55,000, just to be absolutely clear. We are absolutely proud of our efforts to resolve the gender gap. Our Grow Your Whānau policy is absolutely top of its game in Aotearoa. So I'm not going to stand here and watch our team be accused of things which, quite frankly, simply are not true. We're proud of the way we are-
... Accusations? I've asked questions.
We-
Choose your words carefully.
We are proud of the way our whānau in this company are retained and valued, and that is the important thing to note.
Did you have a comment on my supplementary question, which was on the gen, the spread? I also asked about your ethnic spread.
On the ethnic spread, we do have some stats there. The problem we have on ethnic spread is that you’re actually under New Zealand law, staff are not required to state the ethnicity that they relate to, which tends to skew the data. But within the company, we do have, as well-
... As a women's network, we've just recently established a Māori Pasifika network, and we're very strong in the way that we are going. We do engage, and we will engage in tangata whenua.
Excuse me, Cheryl, Cheryl Scott. This man that keeps on asking questions to my left by about 4 or 5, could I please make a note of his full name? And then he's speaking in his own knowledge, so he's talked about the Act. What act is he exactly talking about? And what is his background and reason for all these constant questions when I think the board chairman and, is it Mike Fuge, have answered quite adequately, and I think it's time he... A general rule at public company meetings, you're limited to how many questions you can ask, and I think this has simply ended. But may I have him as his mic, microphone? No, I'm not interested at all.
Okay. So we're sorry, we will stop there, and we're going to stop on this line of questioning. I think Mike has explained and answered it very fully. So let's move on to other questions. Sir.
About the commissioning of Tauhara, there was the mention of the steam hammer event. Could someone please elaborate on it with what happened and what damage was caused, and were there any associated safety issues?
Yeah. Okay. So, right, you're going to get a process engineering lesson. What happened is that in the commissioning, we have to test our process safety systems very carefully, because, in a geothermal plant, as with any steam plant, what matters is how you handle the hot liquid. It is, it's hot, it's 250 degrees Celsius, and it comes into the plant at 18 bar. What happened in this event is, there was the intermediate pressure system, which released some liquid into the header, which is the emergency header. And then the HP, the high-pressure system, discharged an amount of liquid, which the moment it hit the header, became atmospheric, and so it vaporized.
So that steam went down the pipe, and it picked up the liquid that was already in the pipe and threw it against one or two of the elbows. So there was absolutely no loss of containment. All the systems worked as they should, but the pipe moved in the order of 500-700 mm as it went through it. It's a violent reaction. And so that is a steam hammer event. So the systems worked. There was no loss of containment. We were testing for a situation which should never happen in the plant life, but that's the way we do things. We're looking for those rare events. And, what we saw, we thought, "Actually, we can, we can do that better." So that's what we're fixing up.
Mr. Murphy strike, struck again.
It is a corollary to Murphy's Law. You can say that, yes.
Robert, Robert Murray again. Two questions for Mike. First of all, about Tauhara. You said it's going to be up to maximum power or its expected power generation, just as it reaches its first outage? That seems a little bit first planned outage. That seems a little bit unreasonable.
Look, again, it relates to process safety. So, what we... The modifications that we're putting in place as we repair the pipe and the steam, will enable us to get to what we call the GNPO, generation, gross generation power output. And that's what we're looking for, to achieve first and foremost. There might be a possibility it goes a bit higher, but in order to get absolutely certainty to on the 174 megawatts, which is what we call, MCR, or that will be valves wide open, is that there's a few other modifications, increase in pipe sizes, removing reducers and elbows and things like that.
And the pipe work, where the ideal thing is to actually do that on an opportunity basis, and that first statutory outage is absolutely the opportunity we say to get those pipework modifications in. So, yeah, that is... What we don't want to do is to be starting the plant up, stopping it, starting it, stopping it. So we're going to manage that shutdown and manage it well.
Okay, regarding the decarbonization, how does replacing the broken turbine at the peaking of a peaking plant contribute to decarbonization? I thought scrapping that particular turbine would have been a more sensible approach.
Oh, look, the critical thing there is that the lights don't go off. It's one thing. And again, that's very much in line with our values. Our core value set is that yes, decarbonization is absolutely an objective, but we have to keep the lights on. And so firming our electricity, providing firming to the power system is a critical part of our role. And so when the wind doesn't blow or the sun doesn't shine or both those things happen, we need to ensure that that plant is available.
We're very confident, that once we shut, you know, once TCC shuts, our carbon emissions from the two peakers will drop to a minimal amount, and New Zealand itself will be up at sort of between 95%-98% renewable, which is absolutely unheard of in, in the globe, for a country this size. So keeping those peakers, running for at least the next decade is a prudent thing to do.
Okay. Quick question for the board. I note that the dividend is less than 5% of our value of our shares. When is it gonna go to 10%?
Yeah, well. Rather than say when it's going to go to 10, what I would say is, there are a number of things, and particularly in the coming year, in respect of, Tiwai. If Tiwai goes ahead and stays, we'd hope for a longer period, that brings tremendous certainty and investment certainty to the market. So Tauhara coming online, we've spent a lot of money, and that will have a material impact into our earnings going forward. And Te Huka 3 coming online, that's another change. And both of those are effectively energy swaps, so going from gas to steam. Obviously, a lot of money spent up front to get that plant done, but with all those things coming together, that's, you know, a really good time, you know, to think about the dividend.
We'll be able to, you know, look into that next year at some point. Sorry, I did wanna make a few comments on your previous question, which was, you know, why don't we close the peaker? 'Cause it's, you know, through lay, but the board. I just want to stress a point, because we have talked about 2035, and that was a vigorous debate and a good discussion at the board and executive team. I'm hopeful we might do a little better than that, but the reality is, as a board, we sit there really mindful about the trilemma, and the trilemma is affordability, reliability, and sustainability. And all three have to be there together, and it gets harder as you get further up that curve.
We are very clear about our role and not letting the country down in terms of being able to play our part in the reliability part of the trilemma. Anyway, right. More questions.
Did we have a tour group? And you know, just a Monday morning. Have a look around. My second question is the untapped energy source of all the forestry up in Central Plateau. Have you looked at a feasibility study for a cogen plant for the forestry byproducts sitting on the forest sites?
Oh, I'll let Mike. He might talk about the tour as well.
Okay. So we do from time to time, we do indeed invite the public in to see our, our plant. The last time I think we did was Clyde, where we were expecting 200, and I think, the team had over 5,500 people go through that day. Which... So in terms of open days, yeah, we're always open to that, and when we get the plants up and running and stable. But you've got to remember, at the moment, they are very active construction sites, and our passion remains health and safety, the safety and wellbeing of our staff, so we have to balance that. That was the first part of the question. Second question was?
Partly, uh,
Yeah, like, that slash is actually used in Nature's Flame to create biofuel. And we provide Nature's Flame with the geothermal steam directly, which enables it to be dried. So in a roundabout way, it is being recovered, and it is being used, and we are proud to be part of that.
Other questions?
Thank you. Brian, Brian Busby, customer and shareholder. You're also a gas retailer. We have a continuous flow gas heater, which we depend on for our hot water, and we also heat a large amount of our home with a gas fire and other gas heaters. But you're talking about decarbonization. Where is that going to leave us in the future?
Great question. I think that's... If you didn't get it in the way we both Rob and I have been talking, is we wanna walk with Kiwis on that journey over the next decade and help them decarbonize their homes. We're very conscious that the transition is it's gonna require some tough decisions in every household in New Zealand. I have gas in my home. At some point, that will come to an end. And so the intent is that we work with consumers about when they come, it comes time to replace those gas appliances, is what they can transition to in an affordable way. But it's gonna take a bit of time. And, you know, it might be 5 years, it might be 10 years, it might be 15 years.
But we certainly wanna walk on that journey with you.
Sorry, Jenny again. I want to talk about the directors' fees and the remuneration.
... I know you don't want to, but more with the management and corporate scorecard. It's a fine line between transparency, privacy, and disclosure, and I note that in your annual report, you give a scenario breakdown for and whether the management has achieved or potentially achieved their bonuses. Why don't you just be honest and come out and give us the number and say, "Right, this is what management will get if they get Tauhara on board or Te Huka or whatever," rather than give us some numbers that's partially achieved, it's not achieved. So improve that a little bit.
I understand there is privacy with regards to what management earns, but when you're doing really well, management likes to shout out and skite that they've done, and you are trailblazers in some things. So why not sort of improve upon that? Moving on, next question is, or more a comment: The directors' fees haven't been increased since 2008, and Victoria is stepping down, and you've got a—you're at almost at the top end of your pool of NZD 1.5 million. So if you enhance this area of your report, there is a chance shareholders don't mind paying money for good directors and for value that they add. And I wonder if you could improve that so that we don't feel bad when you come for the director fee increase, and it will come. Please.
Thank you for those questions, and I am more than happy to answer them. Look, in terms of the disclosures we've made in the last year around remuneration, we've had a bit of feedback, and obviously, yours adds to that. There is a new NZX guideline coming out. We expect that to be released soon. And we'll reflect that in a revision. But equally, you know, we did toy about more percentages versus sort of colors and lights or things like that. There is an element of subjectiveness and judgment to some of these metrics as well. So we felt that approach was better, but we've certainly got some feedback, and it's an area that we'll put a fair bit of focus in the coming year.
You are correct that the directors' fees haven't increased since 2008. And it is something as we look, and in the process of recruiting more directors and, think about the next couple of years of, directors, who, who may depart as well. And we feel, given all the things we're doing, we, we absolutely want the best quality of directors as well. So it is, it's something where, you know, we'll, we'll, we'll put a bit of focus in the next year or two.
Just on that question, and sorry, Victoria Crone is retiring, so what is the forward thinking of a new director and the skill set that they may require?
Yeah. So, we are out, you know, we will be looking, are looking for a new director. But first, in that process, as we've done a pretty deep dive into the skill base that exists on the board and will change in the coming years as people rotate out, as they get to the end of their terms. And so when we think about the sort of people we want on, there's also an element of overlap with those skills as well. And so that's something where the board is, it's first on the agenda tomorrow. It might be possible, yeah. Okay. Are there any other questions? Okay, I don't believe there are any questions online. As there are no further questions, I now declare the meeting closed.
For those present in the room, I'd like to invite you to stay and join us for morning tea. Please feel free to talk to my fellow directors and members of Contact's senior management team. We will be wearing badge names and very much look forward to the opportunity to talk to you. If you have any customer service queries or would like to sign up as a customer, Matt Bolton, just here, and Brian are here and more than happy to help. Thank you very much for your attendance and continued support of Contact.