Designing the future New Zealand Winegrowers

This group was tasked with recommending a range of options for the membership to consider in the future design of the organisation at a governance and representation level, alongside any potential modifications to the commodity levy.

We are now at that point where the Working Group has come up with some options and recommendations for consideration by members. The core principals which informed its discussions included:

• NZW is highly valued for the work it does on behalf of the membership. We are not dealing with something that is broken here – the question we are asking is, can it be better for now and for the next generation?
• Our core function is advocacy, research, sustainability and to lead the New Zealand Wine brand story. We do not get involved in the business of our members.
• That a combined organisation as an incorporated society is the way to move forward.
• The Board needs to have a majority of industry members, with a maximum of 12 directors.
• The commodity levy is the desired base for future funding, with the concept that every litre of wine and every grape pays a levy.
• Future diversified funding streams are required to ensure the financial sustainability of the organisation.

High Level Insights

Key insights from the work undertaken to date include:

• A sustainable long term funding model for NZW is a challenge with the current industry dynamics.
• Recognition of the diversity of the industry and the challenges this poses for an industry organisation representing all members. Different parts of the membership want different things from the organisation. This requires a high level of governance skills and Board process.
• The election of directors is on a representative basis whereas the business of the Board requires high calibre governance skills to make decisions for the good of the industry.
• A 12-member Board is outside the widely accepted range of five to eight directors allowing for proper decision making.
• Representation is an issue for the membership; any new design must ensure that members have a sense that their voice is being heard.
• The structure of the levy collection system can’t be altered within the current levy order, so if changes are endorsed, they will need to be agreed in a formal levy vote by members.
• Member meetings (including AGMs) have important decision-making roles; voting at these needs to support broad based consensus-led decision making.

Options and recommendations

The potential areas for change identified by the Working Group touch on a number of different areas of the current design and operations of NZW.

In terms of the Board, the Working Group considered a seven or nine-member Board alongside the current 12-member system. The Working Group preference is for a Board of nine directors (three levy college, three members college, three independent directors). This recommendation is based on staying within the realms of good governance and ensuring that industry directors make up the majority of the Board. There are a range of other Board related options and recommendations, including the need to have a robust charter guiding the operations of the Board.

The Working Group has identified that Board Committees have a key role to reply in ensuring the members’ voice is heard, with recommendations to strengthen their roles as representative vehicles.

On levies, after a significant amount of data and scenario analysis, the Working Group has presented two options for levy collection – the status quo with a cap on winery levy, and a three-tier approach that ensures all wine pays a levy without any significant extra burden on any member's contribution. Options for a minimum levy were analysed but not recommended, but on this matter feedback is being sought from members.

Next Steps

The Working Group has identified key foundations for NZW and provided a range of options for discussion with the members. Feedback from members is now being sought in a range of in-person and online meetings in coming weeks. More details on the options and recommendations can be found at nzwine.com/members/about-us/governance.

What is critical to understand is no decisions have been taken at this stage about any changes to NZW. Decisions on changes to NZW governance, representation and levy matters are made by member growers and wineries because NZW is your organisation, and ultimately it is the members who have the say over its Rules, how the Board is elected, and how it is funded.

Following the current member consultation, decisions will need to be made about the final options to be put in front of members. That process will take some time, but it is expected that during 2025 members will have the final say on those matters that will design the future NZW.