Case studies

Ngāti Rarua Atiawa Iwi Trust


The Ngāti Rarua Atiawa Trust is a statutory Trust which was created under the Ngāti Rarua Atiawa (NRAIT) Empowering Act 1993. This Act was created by a Private Members Bill sponsored by Hon Doug Kidd.

In 1853, land originally owned by Ngāti Rarua and Atiawa Iwi, were subject to Crown grants made to the then Bishop of New Zealand for the purposes of establishing a school. No school was ever erected on these lands but a school operated intermittently supported by income earned from the land.

The NRAIT Empowering Act 1993 gave effect to the resolution made by the Nelson Diocesan Synod of the Anglican Church to vest the assets for the Whakarewa School Trust Board in a Charitable Trust for the descendents of the original Māori owners.

The Bill was crafted by the body of owners for charitable purposes and in such a way that the terms of the Charitable Trust were broader than the Trust objects contained in the Anglican Church Trust Act 1981.

The Trust has 2000 registered owners who are the direct descendents of the original owners. The Trust consists of owners from three hapū (two hapū from Ngāti Rarua and one hapū from Atiawa). The Trust is therefore hapū-based and the assets are owned communally and not with shareholdings (unlike, for example, Wakatu Inc where the owners have defined beneficial interests).

The Trust's core business activity is land management. It has interests in horticulture, pastoral operations and leasing land. Since its inception the Trust's primary objective has been to diversify its assets.

The size of the landholding is over 1200 acres, including land in interests across companies and associate interests. The Trust has approximately $25-30 million worth of assets under its management.

The Board consists of eight trustees. Three years ago the Trust was divided into two divisions. The business plan identified the need to divide the social and cultural functions from the commercial functions. Koru Investments is the commercial division of the Trust. Social Co focuses on the social and cultural functions of the Trust. These two divisions have separate agendas and the recommendations from each meeting go back to the whole Trust. The Board has been split in half to work on these two aspects; although non-trustees can be invited onto the social and cultural committee.

The Trust has several associate companies or subsidiaries which are operated as joint ventures with shareholder agreements (see below) and has approximately 60 staff across all its businesses.

  • Viticulture – 33% share in the following companies: Tohu Wines, Tohu Vineyards and Marlborough Rootstock (Vine Nursery Company)
  • Horticulture – 50% share in Abel Tasman Fruit (infrastructure support and packhouse), 51% share in Golden Bay Fruit (an international marketing company) and 33% share in Estuary Pack and Coolstore (coolstore and domestic markets)
  • Seafood – 50% share in Abel Tasman Seafoods (mussel farming company), 50% in Sea Products (mussel processing factory) and 50% in Mussel Extracts (biotech company)

Governance Decision Making Processes

The Trust's strategic direction is documented in hard copy form and is subject to review annually. The strategic direction is forecasted for five years. The Trust's financial year is the same as the calendar year. Mid-way through the year the Trust reviews the overall strategy and tests the 'current thinking' of the Board. The primary objectives of the Trust are to diversify its asset base, improve returns, even out volatility of returns, and grow and maintain its social and cultural development programmes. At the mid-year planning session the trustees do not debate the financial figures, but instead take a strategic approach looking at the 'big picture'. The annual business plan is not signed off until the end of the year.

The strategy 'mix' is not changed annually and changes are only made if the Trust wants to exit from a particular strategy. For example, two years ago the Trust strategically positioned itself to invest in tourism. It then set out to secure a comprehensive package of Department of Conservation concessions.

The annual business plan flows out of the strategic review. The general manager consolidates all business plans and each manager (of each business sector) is able to debate their plan with the general manager. The plan and draft budget is then referred back to the Trust in December.

All investment decisions are predicated on an opportunity considered against the strategic plan. This is intended as a filtering mechanism. Anyone can bring an investment opportunity for consideration.

Due diligence is undertaken if an investment fits within the context of the strategic plan, is seen to add value to the whole organisation and meets the 10% minimum rate of return on investment. If it is a business acquisition a full due diligence process is undertaken (legal and financial). Once the due diligence process is undertaken a comprehensive paper is put to the Board for consideration. The trustees make the final decision.

Managing risk is the main responsibility of the trustees. The business activities could be considered a high risk because of the exposure to climate and export markets and so the asset mix, type of activity and the level of risk are constant factors that are monitored. The Trust has a risk management policy that operates at two levels. The first is the operational and governance matters at the trust level and the second is the operational matters at the business level. All matters are reported on and reported back to the trustees.

NRAIT has insurance covering all aspects of its business. However, the Trust has recently finished a review, in partnership with Wakatu Inc, of its insurance policies. As a result it has one insurer where previously it had a number of companies providing insurance cover.

The Trust has a conflict of interest register and all trustees are required to declare their interests on a regular basis. If a trustee has a conflict of interest, that trustee can participate in the discussion but cannot vote.

The major change that has taken place since the Trust's inception has been the evolution of the Trust's strategy from a passive investment focus to an active role managing businesses. For example, the Trust has invested in the seafood industry, which is a complex industry requiring the trustees to have an active role. Since the Trust's inception other changes have been the establishment of two subcommittees (audit and remuneration) and the employment of a general manager.

Operational Practice

The Trust strives to be the best in the industry and focuses on best practice whether it is in governance or management. Managers' performances are benchmarked against the industry.

The level of the skill and knowledge of trustees has grown since the creation of the Trust. If the Trust requires development in a particular area, the opportunity for collective training is given - for example, in risk management or improving governance practices.

Accountability to Shareholders

The NRAIT Empowering Act 1993 requires the Trust to hold two meetings of owners annually. The AGM is held in April every year and presents the financial audited results of the year and an overview of the performance of the Trust. The mid-year meeting is to update the owners on the Trust's progress.

Other accountability and communication mechanisms the Trust has used are a webpage, email database and quarterly newsletters.

Performance Reporting

The Trust recently undertook a research project which included conducting an extensive survey and focus group hui on the social and cultural development of the owners. This project culminated in a social and cultural plan. As a consequence the Trust is now prioritising its actions on a more 'cultural' basis. It is also in the process of employing a project manager to implement the plan.

The Trust's economic performance is measured against the business plan and benchmarked against industry best practice.

The Trust is very committed to implementing environmentally sustainable measures as part of its business. The Trust has a restoration project on and off the land. It also has a wetland restoration plan and a waahi tapu planting programme. In terms of industrial use of land, the Trust is a leader in protection of the land. This can be seen in the spray programme, where the risk of spraying is assessed using computer based information and on international standards, such that the sprays used 5-10 years ago are no longer used. The focus of the spray programme is now on composting matter for the soil.

The Trust is also actively involved in water management at a district and regional level. It is also involved in the marae resource management committee which includes Wakatu Inc, NRAIT and all iwi and marae in the Nelson/Marlborough region. Some things the committee is involved in are monitoring land disturbance and the active planting of native trees for tribal resources.

Board Performance Review

The trustees' performance is reviewed by the chairperson. The Board, as a collective, reviews the Board's performance but has in the past been reviewed by a consultant.

Engaging with Shareholders and Stakeholders

The general manager generally interfaces with stakeholders. Regionally-based industry issues are dealt with by management. However, if issues are at a national level then the trustees will get involved, as it is political and they are representing the views of the Trust. Usually it is the chairperson who will front national issues.


Under the Trust's constitution Ngāti Rarua makes up 80% (six trustees) and Atiawa makes up 20% (two trustees) of the trustees on the Board. The trustees are elected on a three year rotation system. All nominations for trustees close three weeks prior to the AGM. All candidates are required to provide a curriculum vitae or a profile. The candidates are also required to present themselves at the AGM. Voting is done by ballot.

Operational Processes

The Trust recognises the difference between governance and management and gives direction to the manager.

The Trust has a general manager who has an employment contract based on key performance indicators. The contract includes a base salary with a performance component. The general manager is assessed against achieving the goals in the business plan and the overall strategy. Management performance is reviewed annually.

The Trust's employment policy is 'all things being equal employ the best person for the job'. Otherwise preference is given firstly to owners, secondly to whānau and thirdly to Māori.

Authority is delegated to the manager to implement the business plan. Any expenditure outside the business plan must be signed off by the trustees. Although the general manager has delegated authority, there are many checks and balances in place for all expenditure. Trustees are able to check a schedule of payments (three months in advance) which must be signed off by two trustees. The Trust has a direct credit payments system and uses independent accountants.

The Trust has an operations policy manual which is considered a living document. Policies are always evolving as it is sensitive to industry and customer changes.


The Trust has eight trustees. This is considered an optimum number by the chairperson, given the nature of the Trust's workload and the Board's split between Koru Investments and Social Co. It also allows the trustees to rotate between the two.

The Trust uses a democratic process to elect trustees. The chairperson delegates responsibility for portfolios.This tends to mean that the quality of reporting is high as the trustees have to 'front up' to owners.

All trustees participate in the Institute of Director's programme. Each trustee's training needs are assessed. Likewise, the whole Board's training needs as a collective are also assessed. All trustees attend various industry conferences and specific workshops (often in conjunction with Wakatu Inc).

Financial Analysis - Ngāti Rarua Atiawa Iwi Trust

 Actual 1999Actual 2003
Operating surplus before tax572,197-653,005
Net Surplus (NPAT)572,197-653,005
Average Total Assets15,474,10525,587,317
Average Shareholders’ funds14,973,02820,797,468
 Actual 1999Actual 2003
Operating Surplus (%)18.27%-18.59%
Return on average equity after tax (%)3.82%-3.14%
Return on assets (EBIT)/average total assets) (%)3.70%-2.55%
Liquidity and Efficiency
 Actual 1999Actual 2003
Current Ratio14.812.05
Quick Ratio (equity ratio)12.741.38
Financial Leverage
 Actual 1999Actual 2003
Debt to average equity (%)1.94%8.29%
Gearing (%)0.44%19.25%
Proprietorship (%)99.56%80.75%

Last modified: 7/06/2011