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The role of a board member


All board members of any type of board have a ‘fiduciary duty’. This is their responsibility to act in a position of trust on behalf of others and in an appropriate manner. The enabling document (e.g. Trust Deed, Constitution, Act of Parliament) of the particular entity sets out the responsibilities that apply for that entity. The Crown Entities Act 2004 has a clear list for Crown entities. These are discussed below.

The board member’s “hat”

When carrying out their role, board members must ensure they are wearing their “hat” as governors. All board members have clear responsibilities to the entity and to Ministers and they must avoid acting otherwise. Their role is as detailed under the earlier topic – Governance/Management interface.

“[The] Board sets the strategic direction and priorities, sets board policies and management performance expectations, identifies and manages risk, monitors and evaluates organisational achievements in order to exercise its accountability to the organisation and its stakeholders.”

The duties of members under the Crown Entities Act 2004

As stated above, those members who are on statutory boards are subject to listed responsibilities under the Crown Entities Act 2004.

Collectively, members owe duties to their responsible Minister. These duties are to:

  • act consistently with objectives, functions, statement of intent and output agreements;
  • ensure that functions are performed efficiently, effectively and consistent with the spirit of service to the public; and
  • act in a financially responsible manner.

In addition members have individual duties to both the responsible Minister and to the entity. These are to act:

  • in compliance with Crown Entities Act 2004 and the organisation’s own Act;
  • with honesty and integrity;
  • in good faith and not at the expense of the entity’s interests;
  • with reasonable care, diligence and skill; and
  • in a manner that does not disclose information.

Being a member of any board is a significant responsibility. It is a responsibility that is not confined just to meetings. Members also need to ensure they have the time and the ability to prepare for key issues, events and meetings.


Web links

  • The Board Charter for the New Zealand company, Contact Energy provides a good governance framework for an operating board here.



Updated on 7th October 2019