If you want to be Reserve Bank Governor, think you have what it takes, (and haven’t yet been approached by the Board’s recruitment company) you will need to get moving. Applications close on Friday.

As a reminder, much of the process (unusually by international standards) is controlled by the Bank’s Board, most of whom were appointed to their positions by the previous government. The Minister of Finance (and Cabinet) will finally make the choice, but they can only appoint someone the Board nominates. The Minister can reject a nominee – either before or after the (now required) consultation with other political parties represented in Parliament – but cannot impose her own candidate. I’m not aware that a recommended nominee has ever been rejected [UPDATE: I’m reminded that Michael Cullen rejected the Board’s nomination of Rod Carr], although in 2002 after Don Brash resigned it was understood that Helen Clark had made clear that she was not going to have a “Brash clone” appointed (hard luck for the acting Governor Rod Carr, who in those days had not really begun his migration to the left).

In practice, things can be less mechanical than the statutory model sounds (and, I believe, was intended to be). There is nothing to stop a Minister of Finance engaging with the Board before they advertise and making clear what sort of person s/he (the Minister) would or would not be looking for in an acceptable appointee. To me, that sort of engagement seems entirely proper. Much more questionably, there isn’t anything to stop the Board offering the Minister a menu of candidates and inviting her to pick one (this happened when the first external members were appointed, where the same statutory appointment process applies). How receptive the Board might be to such influence will, no doubt, depend. Stubborn Boards, with a strong sense of their own legitimacy, might be inclined to play by the letter of the law. Boards largely appointed by a previous government and having presided over things at the Bank going less than well, perhaps less so. It would be interesting to know what, if any, consultation there was with the Minister of Finance on the job description used to support the advert for the vacant Governor position.

(My own preferred model – a much more internationally conventional one – is that the Minister (and Cabinet) should be able to appoint her own person as Governor, taking advice no doubt from the Board and from her principal economic advisers at The Treasury. The government cannot escape responsibility for the Bank, and the powerful impact of its (good or bad) choices, and should be free to choose, not constrained by any Board, let alone one (a) appointed largely by the previous government, and b) with such a demonstrably poor record.)

These are key competencies etc they claim to be looking for

Might we guess that that third item, in particular that reference to “drivers of competition” might have come from – or been included to anticipate – the Minister? It is an odd one otherwise, given that promoting (or otherwise) competition isn’t really a part of the Bank’s responsibilities (think monetary policy, prudential regulation, and monopoly issue of notes and coins). But if they want someone to encourage the reintroduction of banknote competition it would be obscure, but I’m all for it.

I guess we should be encouraged that subject expertise seem to rank high on the list of required competencies, even if “strong understanding” may be weaker than it sounds, especially when contrasted with the “detailed knowledge” required on the subjects in the third bullet.

But the items that really caught my eye were further down the page.

First, there was that experience criterion “preferably at CEO level”. Since the Reserve Bank was given operational autonomy, three of the four Governors had had previous CEO experience (Wheeler was the exception). Internationally, I think it is less common (over the same period I think one of four of each of Bank of England and RBA Governors had previous CEO experience, and perhaps 2 of 6 at the Bank of Canada). Highly successful organisations tend to build the capacity to promote from within, which militates against past CEO experience while favouring actual subject expertise, but the last internal appointee to the Reserve Bank Governor role left in May 1984.

Second, there was this: “Have the personal resilience to cope with adverse and stressful circumstances and to withstand both justified and unjustified criticism.” It could hardly have been more pointed in its contrast to Orr, and I suppose it speaks to the credit of the Board that they (apparently belatedly) recognised behaviours they had tolerated. I guess they could have added explicitly “the integrity not to actively mislead, or worse, Parliament, or to abet such behaviours from a superior”.

Third, there is that odd requirement (odd to make it so explicit) about reviews, with the explicit expectation that the appointee “respond in an open-minded manner to any recommendations received”. Pretty basic stuff you’d have thought, but…..not from Orr.

And then there is the woke stuff. Of course, it might be a trick question – the Treaty of Waitangi is not mentioned in the Reserve Bank Act at all and perhaps not all applicants would have done their homework sufficiently to know, but it is probably just a continuation of the whims and preferences of Orr/Quigley and the former Labour government. Among other things, it might be thought to discourage really able overseas applicants (even if in the end it is unlikely to be make or break for the Board in coming to nominee to send to the Minister).

I also took a look at what the Board had advertised for in 2017 (post here), bearing in mind that Neil Quigley was chair of the Board then too. Arguably the 2017 advert was a little more ambitious in the quality of the person being sought, although as I quibbled then with some of the points they’ve now taken out I wouldn’t make much of it. Perhaps the only point worth making is that instead of someone with “outstanding intellectual ability” and “gravitas” they gave us Orr. The 2025 advert is broadly enough framed that really almost anyone could end up chosen. And neither advert put any sort of emphasis on change management or a vision for a different and better-performing Bank.

I note here just briefly again how extraordinary it is that Neil Quigley is still driving this process. When you were responsible for the nomination and reappointment of the previous Governor who did so poorly on multiple fronts and then walked off with no notice, when you were responsible for the Bank (a) setting budgets last year far in excess even of what Grant Robertson had allowed them, and b) bid for that to be new baseline, despite a climate of wider spending restraint on most agencies, you really shouldn’t be driving the selection of the next Governor. Oh, and when you were responsible – with the previous Governor – for keeping experts off the first MPC, and then later actively misled Treasury and the public about that blackball. It remains beyond comprehension why Willis reappointed him last year – although only for two years, clearly not envisaging that he would drive the performance of the next Governor – or why she has not prevailed on him more recently to step aside. The government has been advertising for two new Board members, but it seems unlikely they will even be in place before much of the winnowing process – including the guidance to the search firm – has already happened.

But who might emerge?

We haven’t seen much media commentary for a couple of months now. I haven’t seen any new names for quite some time (well, apart from the smart person who has tried a couple of times to convince me that Bill English will end up as next Governor). In one of my earlier posts, shortly after Orr resigned, I had these names from various newspaper columns and my own speculations:

(I think I also saw Karen Silk’s name in one article, surely only because someone was uneasy that there were no other women on any of the lists).

If you search this blog you can probably find posts with thoughts on McDermott, Archer, and Bascand. I won’t repeat that here.

All have had some background at the Reserve Bank, and quite a few at overseas central banks or central banking related institutions (IMF, BIS). Four (Grimes, Bascand, McDermott, Hansen) have some chief executive experience.

I don’t think any of these people would be ideal for the role now, but a lot depends on what the Minister really wants, and how much she cares about a better performing Bank. And several of these people may have no interest whatever in the role – whether from age, or inclination (better things to do with your life than 70 hours a week, endless meetings and bureaucracy, lot of travel etc). Archer – who would probably be very much the sort of candidate of bold and far-reaching change, backed by intellectual rigour etc – has lived abroad for more than 20 years now (we share the dubious responsibility of being trustees of the ill-governed Reserve Bank superannuation scheme). In key public sector appointments to date, the government has more often tended to recycle established figures.

Several of those names might count as, or risk being, establishment or status quo candidates. One could think of Bascand, probably not interested, or Gai (appointed to the FMA Board by the previous government, appointed to the MPC by this government, and while undoubtedly able has never once expressed even a jot of public concern through the Orr years, despite all that “critic and conscience” role of academics). And Hawkesby.

Hawkesby is, at present, the temporary Governor (six month stint while the permanent appointment is made). The last long-term acting Governor (Rod Carr) never made it to Governor, and left the Bank within a year of missing out. Hawkesby’s day job is Deputy Governor and head of the Bank’s burgeoning financial stability and regulatory functions. He has some things in his favour. First, the Board knows him (and will have seen at least a couple of months as acting Governor, including having wielded the knife to shrink the badly-bloated top management group). Second, he is a decent person, and it is very unlikely that he would be found repeatedly actively misleading FEC or the media (last week’s appearances, after Orr, were a breath of fresh air). And, third, he has an interesting range of relevant background (Reserve Bank in two stints, Bank of England, Harbour Asset Management – was that 3rd bullet put there for him?) And, fourth, he is closer to the age one might ideally be looking for in a longer-term Governor (I think appointees in their late 60s would be less than ideal).

All that said, I think it would be a bad appointment, for multiple other reasons. First, there is little or no sign of any real intellectual or policy depth (check out the various speeches he has given since rejoining the Bank in 2019). We have little or no insight on how, or what, he thinks (if anything) beyond the wholly conventional. Second, he has served on the MPC for its entire six year term so far, and was Assistant Governor responsible for monetary policy, markets, and macro during the height of the pandemic period, when the huge policy misjudgments (LSAP and the length of the period when the OCR was left well below neutral, even as inflation was blowing out) were made. Third, he was Orr’s handpicked deputy (the vacancy was never advertised when Geoff Bascand announced his resignation), through a much wider range of mistakes and misjudgements (down to and including last year’s budget and the last gasp big expansion in staff numbers). Fourth is a related point: no one survives in Orr world if they challenge him or disagree materially with him. Hawkesby survived, presumably by (at best) just keeping his head down, or at worst going along with it all (inappropriate jokes – per Paul Conway – and all). He sat alongside Orr on various occasions when his boss actively misled FEC, and never said a word of correction or clarification. Hawkesby has ability, but my view has consistently been that he was appointed and served at one level above his actual capability at the time (thus, when Orr headhunted him to be the Assistant Governor for monetary policy and markets, he might have been a very good appointment as Head of Financial Markets). He may be appointed Governor, but if it happens it will be a mark that neither the Minister nor the Board really care much about a world class central bank. But, as I say, he probably wouldn’t lie to FEC. A low bar, but we have to start somewhere.

What of other people? I rule out the Bill English suggestion (yes, former Ministers of Finance have become central bank Governors elsewhere, but usually when they’ve previously been well-regarded economists, and it would be highly desirable to have an appointee the political parties in Parliament were broadly comfortable with and confident in). But there must be people out there with stronger private sector experience, and yet some of the skills/experience one might normally look for in a central bank head. Craig Stobo, for example, is currently the chair of the Financial Markets Authority and is thoughtful on economics and markets issues (even if weirdly running commentary on The Platform on all manner of other policy and economic topics, including last week’s MPS). Or Andrew Bascand (Hawkesby’s former boss at Harbour, and ex RBNZ and BOE)? Or…..or…..or? (Just not Orr or Orr-like, please…….)

Remember, applications close on Friday. In several months’ time we’ll know who has got the nod.

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I’ve put the full advert and job description text below for future reference (since the link at the start of the post will no doubt be taken down in the coming weeks).

Recruitment process for new Governor of the Reserve Bank of New Zealand

The Board of the Reserve Bank of New Zealand Te Pūtea Matua has started the search and recruitment process to identify a new Governor.

Published:

23 May 2025

Recruitment process

The Board’s statutory responsibility is to nominate a candidate to the Minister of Finance, who then makes a recommendation to the Governor General for appointment.  

The Board has engaged the executive search firm Heidrick and Struggles to help with the search and recruitment process.

The advertising and search activity will run throughout May and June, with interviews and assessments in July and August, followed by a nomination to the Minister of Finance. The Minister will then consult with political parties and make a recommendation to the Governor General for appointment. See Reserve Bank of New Zealand Act 2021.

While this process continues, Christian Hawkesby remains Governor of the RBNZ. 

Application process

The requirements for the role are set out in the job description (PDF, 157KB).

To express interest in the role, please contact RBNZGovernor@heidrick.com before 6 June.  

Position Description for the Governor of the Reserve Bank of New Zealand

Key functions and responsibilities
The Governor performs the role outlined in the Reserve Bank of New Zealand Act 2021 (the Act). In
particular, the Governor is the:
a. Chief Executive of the Reserve Bank
b. a member of the Board of the Reserve Bank
c. Chair of the Monetary Policy Committee (MPC).
The Governor is responsible for performing and exercising functions and powers delegated by the
Board.

Chief Executive role

The extent of the Board’s delegation to the Bank is outlined in the Board’s current Delegation
Policy; however, it is anticipated for the purposes of this job description that the Board:

• Will delegate the management authority to the Governor for the day to day running of the
  Bank.
• Will delegate regulatory statutory powers to the Governor.
• The delegation of day-to-day management authority will exclude any matters the Board
  reserves to itself for decision making.
• The delegation of regulatory statutory powers will be subject to a framework laid out in the
  Delegation Policy for the referral of particular matters to the Board for either decision or
  guidance.
• The carrying out by the Governor of any powers, functions, duties, authorities or
  discretions (or the carrying out by preapproved people he or she sub delegates to) must
  all times be consistent with policy and frameworks set by the board and any applicable
  Bank policies.
  The Governor is responsible for ensuring that relevant and sufficient information flows to the
  board and to support the board and its individual members in fulfilling their collective and
  individual duties outlined in Part 2, Subpart 4 of the Act.
  The Governor will be a key spokesperson and representative for the Bank in its external relations
  and carries significant responsibility for effective communication by, and the image and standing
  of, the Bank.
• Board member role
  The Governor is a Board member of equal standing to other Board members and shares the
  collective authority and responsibility of members as outlined in section 24 of the Act.
  
• Chair of MPC
  The Governor is the Chair of MPC with the responsibilities outlined in the Act, Charter and Code of
  Conduct. These responsibilities include convening chairing meetings of the MPC and being the
  official spokesperson for the MPC.
• Criteria for appointment / key competencies
  The Governor will:
• Have a strong understanding of monetary economics and monetary policy.
• Have a strong awareness and understanding of financial policy and regulatory frameworks.
• Have a detailed knowledge of domestic and international financial markets and drivers of
  competition.
• Be familiar and up to date with best practice risk management frameworks applicable to
  the Reserve Bank.
• Have advanced relationship management, influencing and communication skills, sufficient
  to successfully manage relationships with the Minister of Finance and other senior
  government ministers, opposition political parties, media, leaders in supranational financial
  institutions and peer central banks and regulators, regulated entities, other public agency
  CEOs, Iwi leaders and all members of the community.
• Have a sound understanding of public policy decision making processes.
• Have the ability to lead the effective deployment of the Reserve Bank’s resources and
  demonstrate performance achievements in a public sector environment.
• Have a successful record of setting and leading a strategic path for a complex, multi
  faceted organisation. Have in-depth management experience of a substantial entity,
  preferably at CEO level.
• Have the personal resilience to cope with adverse and stressful circumstances and to
  withstand both justified and unjustified criticism.
• Have the capability to periodically commence external reviews of aspects of the Reserve
  Bank’s functions (including monetary policy), responding in an open-minded manner to
  any recommendation received and implement change processes as appropriate.
• Highly developed cultural capability, particularly concerning Te Ao Māori, and awareness
  of the role of Te Tiriti O Waitangi
• Demonstrate exemplary leadership skills:
  o Undoubted integrity.
  o Empathy and emotional intelligence.
  o Sound judgement and decision making.
  o Openness to new ideas.
  o Highly developed inter-personal skills.
  o Ability to develop human capital of an organisation.