The Chamber Board Nominations Now Open

We are rapidly approaching another  AGM scheduled for October 12 2016.

Prior to that we  are required to hold elections for our Board.

The Board consists of 12 Directors, each serving a two year term. There are six positions available this election. Candidates must be existing members of The Chamber and adhere to the nomination process as specified in our constitution.

Nominations must be received no later than Friday 19 August 2016. Electronic voting commences in September and closes 5.00pm Tuesday 11 October.

The Chamber Elections are always hotly contested, which shows that our democratic processes are alive and well.

I would encourage members to consider being nominated. Being a Board member is a rewarding but not too demanding experience.

Being involved with The Chamber at Board level is an excellent way to be introduced to governance roles and to assist The Chamber to determine its policies and strategic direction

We look forward to receiving nominations - if you would like further information please don’t hesitate to contact me on 03 366 5096 or email petert@cecc.org.nz.

Full details and nomination forms are available on our website here.

Heading home

On 22 July the Canterbury Employers’ Chamber of Commerce (the Chamber) arrives home at last. We move back to 57 Kilmore Street where the Chamber was based for close to 30 years before the devastating earthquakes of 2010 and 2011.

For the first time in 157 years the Chamber will be based in a purpose built and dedicated new building which has been designed specifically to meet its needs with a range of meeting rooms, high quality open plan office space and supporting facilities. From its beginnings in Lyttelton in 1859, through a variety of locations in Lyttelton and Christchurch city the Chamber now has a real home of its own and paradoxically this is because of the tragedy and destruction of the earthquakes.

It is a story worth telling because it is a story that will be common to so many people who are transitioning back into the central city five tumultuous years after approximately 1,100 commercial buildings were destroyed or irreparably damaged. The Chamber building survived the September 2010 earthquake but was rendered un-occupiable in February 2011. Ironically there was a health and safety seminar being conducted at the time. No-one was hurt but the building was damaged beyond repair. The Chamber then relocated to my residence for six months before relocating to the Westpac Business Hub at Addington and then to Colombo Street. After a five year journey we return home.

The journey was not without its difficulties. We had a prolonged negotiation with our insurance company (as did many other businesses) and we had significant disruption with regards to our temporary relocations. But we always remained “a safe pair of hands” for the business community. As a part of that we worked very closely with the Canterbury Development Corporation (who also lost their building) in the delivery of business support services through Recover Canterbury. Recover Canterbury was a very positive and constructive joint venture that assisted thousands of businesses post-earthquake.

We eventually cash settled with our insurance company and about a year ago set about finalising plans for the rebuild at Kilmore Street. We were confronted with rigorous consenting processes. We had issues with poor substrate and some contamination on our site (which for many years hosted a dry-cleaning company) but we moved through the difficulties. Through the good support of project managers, architects, builders and a plethora of tradespeople we have ended up with an elegant statement in the central city.

Our new building is designed to be accessible, it is energy efficient and has been specifically built to operate as a functional base for the Chamber now and into the future. It will be a well-used facility with a core staff of 30 who on a good day can process in excess of 100 sets of export documentation and host several membership training programmes and events concurrently. The Chamber conducts over 200 training and development programmes and events each year and many of those will now be delivered from the home base. The Chamber building will be host to thousands of visitors annually who we know will enjoy our new offering.

Returning to a permanent base will allow us the luxury of thinking more strategically about the role we will play in supporting employers across Canterbury in a volatile and rapidly changing environment. It is now all about making the most of the opportunities that are ahead of us.
After a long and torturous pathway, like so many other businesses coming into the central city, it is
great to be heading home.

petert@cecc.org.nz

cecc.org.nz

Energy Efficient Christchurch

One of the really interesting and beneficial side effects of rebuilding our city is that we will be tracking towards energy efficiency in a way that was unprecedented before the earthquakes.

In the commercial sector the new buildings that are being built all over our city and in particular in our central city are being built to new building standards which incorporate much improved insulation, double glazed windows, the use of heat sinks, heat pumps and a general appreciation for the need to build in an energy efficient way.

Some buildings are deliberately being built green, others will be green just because they are built to modern building standards. That will change the energy profile of the commercial buildings in our city to the better.

In our household sector there are approximately 25,000 homes that have an excess of $100,000 of damage that will be rebuilt or repaired. Of those, 10,000 will be rebuilds and of that total almost 20,000 will be cash settled, private controlled repairs or rebuilds. In the process of rebuilding or radically repairing houses they will be subject to the new building code and will incorporate high standards of insulation and other designs to promote and enhance energy efficiency. There are examples in this city already where new builds of approximately the same area of the house they are replacing and have reduced the energy consumption by 60-70%. The most important component in this is insulation. Well insulated houses are warm, energy efficient houses and a direct investment in family health and financial wellbeing.

However, there is a significant proportion of our community who are still seriously disadvantaged with regard to ensuring their houses are warm and safe and that they have insulation of a standard required to deliver reduction in heating costs and health benefits to the household.

It is important as we begin to demonstrate, in the context of the rebuild, an evolution towards one of the most energy efficient cities in Australasia that we take care of those people who need help in this context.

One of the agencies that has been material in improving the insulation in Canterbury is the Community Energy Action Charitable Trust (CEA). CEA has been operating in Canterbury for 22 years and has insulated over 20,000 homes. It can provide subsidies to low income households to create warmer, drier and healthier homes. With highly trained and experienced assessors and installers it not only provides subsidised assistance but also offers a professional non-subsidised insulation install service. This is a worthy cause which has demonstrable benefits.

There is a direct correlation between warm homes and reduced absenteeism from school and businesses due to sickness. Recently released findings from the Healthy Home programme, that CEA was involved in, which provided insulation and/or heating to 900 high health needs hospital patients within Canterbury, showed a nearly 30% reduction in hospital bed days for those patients who were assisted, which in turn saved the Canterbury District Health Board nearly $1 million in the first year. It irrefutably showed that investing in insulation is investing in improved health and wellbeing.

The difference insulation makes to a home is something that most of us do not think about when building or renovating but the results can be dramatic. Insulation provides heat retention while reducing the amount you need to spend to heat your home to keep it at a healthy temperature. Having an energy efficient heat source is also important. Homes that leak heat, leak money.

At the Canterbury Employers’ Chamber of Commerce we believe that insulating homes and commercial buildings is investing in our future. We want Christchurch to be recognised as one of the most energy efficient communities in the southern hemisphere and we encourage people who can afford to insulate their homes to do so. People who cannot afford to insulate should seek help from organisations such as the CEA.  It really does make a difference.

petert@cecc.org.nz

cecc.org.nz

Modern workplace dynamics

Most adult New Zealanders are working for someone most of the time. The workplace relationship has changed markedly over the years. I recall when I started work what I did in my own time was my business and what I did in the company’s time was the company’s business and I should never let the two conflict according to my Manager. I was required to be at work at 08.00 hours, I could take 30 minutes for lunch and was not expected to leave my job until 17.30 hours unless there were exceptional circumstances.

The employment relationship has improved dramatically over the years for most of us and there are some key drivers in modern workplace dynamics.

The first is flexibility. Good employers adopt flexible workplace practices as a mechanism to attract good people to improve productivity and to respond to next generation employees who demand flexibility as part of their lifestyle. A recent national survey of employers conducted by the Ministry of Business, Innovation and Employment (MBIE) stated that 36% of all employers are operating some sort of flexible work practice and that percentage is increasing over time.

Another consideration in the context of the modern workplace is a philosophy of empowerment. Good employers are much more interested in outcomes than they are in ring-fencing employees and demanding that they operate in an output driven environment (that was the old way of doing things).

Good employment practice is driven by strong personal relationships. The breaking down of hierarchies and understanding that everyone in the workplace has an important role to play as a member of a team. Good employers realise that every person in their workforce has something significant to contribute and needs to be recognised in that context.

We are also seeing much more cultural diversity and this has been particularly true in Christchurch in the last five years. The same MBIE survey stated that nationwide 25% of all employees have employed a migrant in the last 12 months. That figure would stand up well in Christchurch. 60% of all employee’s state that migrants make an important contribution in the workplace.

Increasing accessibility is indicative of the modern workplace. It is now accepted as a part of good employment practice that workplaces are accessible and that people with disabilities are not impeded in a working environment. Most importantly health and safety, which used to be regarded as a bit of an add-on in the workplace, is now mainstreamed into good employment practice. We have seen through the Health and Safety Charter here in Christchurch significant health and safety improvements in anticipation of the new Health and Safety Act. We now recognise that a good workplace is a healthy and safe workplace. In the MBIE survey referred to above 83% of employers say that good health and safety practices are good for business. Of course that figure should be 100%!

The old paradigm of work/life balance is now an anathema. It is not about work/life balance and the perception that work is bad and life is good and somehow we have to get the balance right. The term I encourage is getting your “life balance” right. Your life balance comprises your family life, your social activity, your sporting pursuits, your working pursuits, your spiritual pursuits and your community engagement. It is not just a matter of a tension between work and life and getting the balance right anymore. 

The important message from an analysis of modern workplace dynamics is that good employers are continuously improving the workplace environment, have respect for employees and are encouraging the contribution they make to good work outcomes. Employers who do not keep up with this new environment will be severely disadvantaged. They will simply not be able to attract and retain good talent, and after all, it is good employees that make businesses work. 

petert@cecc.org.nz

cecc.org.nz

The Chamber's submission on the Council’s Annual Plan and Long Term Plan.

The Chamber has produced a very considered, detailed submission on the Council’s Annual Plan and Long Term Plan.

We are concerned that the Council is proposing to manage the rebuild in a slower, more conservative manner than they have stipulated in The Long Term Plan. We believe this will have long term negative ramifications for our city.

Please find the submission here for your perusal.

We anticipate there will be local media interest. We value your feedback.

petert@cecc.org.nz

cecc.org.nz

Realising Interdependency

As the construction of the rebuild hits the halfway mark in Christchurch we are starting to become much more definite about how our city is going to look and function in the future. There is no doubt at all that on both counts it is going to do extremely well. However, we must be aware of the importance of recognising the interdependency between the regeneration of our city and the continuous economic development of our region.

The New Zealand economy is performing relatively well; low inflation, generally good and increasing export activity and reasonable domestic economic growth mean that New Zealand is well placed now and into the future. As a microcosm of the New Zealand economy, Christchurch and Canterbury are also extremely well placed. When we look at the wider region, our eyes immediately turn to farming and tourism.

From a farming perspective increasingly sophisticated land use and a much more sensible water use regime are both vital to our future. How we apply technology on farms to ensure that we operate our farming systems with integrity and sustainability is going to be vital in our future. The city has a major role to play in providing the means to do that. Water and how it is stored, allocated, used and reused is going to be the other critical factor from a land use perspective. We have not been good guardians of our water to date and in a context of the sensible harvesting and farming of water we need to ameliorate some of the environmental damage that we have already incurred, including low land river flow regimes and Lake Ellesmere. The clever use of technology, much of which is developed in our city will be critical to address true sustainability into the future.

From a tourism perspective we are on the cusp of a massive increase in middle class, free independent travellers coming from off-shore, particularly Chinese and other Asian markets. They are discovering day by day the beauty of the South Island. Our airport has a vital role to play in providing wide-bodied aircraft capability to bring passenger traffic in and out of our city from overseas destinations. Wide-bodied aircraft also enable us to handle the increasing freight demands for perishable freight going directly from areas within the South Island, particularly to Asian markets. Much work still needs to be done on tourist accommodation within and on the outskirts of the city. We also need to ensure our roading infrastructure is right and that we are capable of handling increasing numbers of free independent travellers.

The issue from a tourism perspective is not the uniqueness and beauty of our offering, that is a given! The big issue is how we manage in a very supportive and enriching way the increased numbers of tourists who are coming here to spend their money in this beautiful part of New Zealand. 

Canterbury has a golden opportunity; we need to make the most of it. It is up to all of us to be prepared.

petert@cecc.org.nz

cecc.org.nz

The expected protracted downturn in dairy prices puts a new dimension on commodity price cycles

Historically prices have risen and fallen on a regular basis. This downtown does not appear to be part of a normal cycle. The world is awash with dairy products, subsidies to support farmers in other countries are being increased which will artificially support continuing high level production, and there are major market dynamics at play especially with worldwide increasing production, Russian markets being boycotted and shifts in Chinese demand. 

Any reasonable analysis would therefore assume no significant price rises any time soon. Given the extremely low base prices have fallen to, clearly below the cost of production, that is a real worry for all dairy farmers and particularly those that are financing significant debt.

It must also be  of major concern to banks. The determination of banks to support farmers through this crisis will be tempered by the prospect of prices remaining low into the foreseeable future. The banks will be asking themselves where the trigger point is farm by farm in terms of when they reach the limit of debt funding, which will be before the possibility of the farming business losing the ability to reduce and repay debt no matter what. If the price cycle was predictable and anticipated to be short that calculation would be much easier. In this environment assessing the point of no return is complex and fraught. 

So we can expect significant fallout  in the dairy farming sector. That, in turn, will flow through the rest of the South Island economy.  

Dairy farming  represents a significant, and until recently, growing proportion of the South Island's rural economy. We are good at producing milk at reasonable cost and we all know that there have been significant farm conversions to dairy, right across the South Island. Given that investment in this sector in the South Island is relatively recent there is a lot of bank debt associated with farm conversions and set-ups.

Smaller rural centres are already feeling the pinch. Larger centres, and indeed our South Island cities can expect to suffer negative impacts to varying degrees.  

For example, Christchurch is still dependent on what  happens in the rural sector to a significant degree. Christchurch is  buffered by the rebuild spend but we do have many businesses right across most sectors that rely on rural spend 

Regretfully  there is a flow-on effect from the downturn. An unfortunate example of this is Fonterra’s determination to extend its payment to creditors out to 90 days. That in turn puts serious cashflow constraints on suppliers who in turn will be forced to delay payments to their debtors and creditors and so it spills down through the supply chain.

Dairy farmers closing their cheque books has the same sort of impact.

This all means that  businesses need to be strategic in the context of this crisis, they need to be diligent with respect to creditor/cash flow management and they need to ensure they protect their quality business relationships.

Long term there is light at the end of the tunnel, given the increasing demand for dairy products worldwide and our ability to produce high quality products cost effectively, particularly in the added value area.

Regretfully this time around it is looking like an awfully long tunnel.

petert@cecc.org.nz
cecc.org.nz