Dunedin Mayor Dave Cull and DCHL chairman Paul Hudson both agree changes are needed to the structure of the DCHL board and its subsidiary companies.
DCHL has a five-person board, chaired by Cr Hudson, and its members also sit on separate boards for the six council-controlled organisations (CCOs) - excluding Citibus Ltd, sold earlier this year - under the DCHL umbrella.
Mr Cull, in revealing the projected $8 million shortfall in DCHL dividend payments to the council, on Friday warned it was a structure that needed to be changed.
Two separate reviews had been carried out in recent months, one by the council's new CCO liaison group, and a second by company director Warren Larson.
Mr Cull on Friday told the Otago Daily Times both had concluded the composition and skill sets of the boards "needs to better reflect the companies' core activities", while reporting mechanisms to the council needed more transparency.
Asked about the findings, Cr Hudson agreed change was needed, saying he was "not at all" opposed to restructuring.
"As things change within a board structure, for example Citibus being sold, you should be constantly reviewing the skills that you need within the directors looking after the council companies."
The companies had been established with separate boards for DCHL and its subsidiaries, which created communication difficulties and had not worked, he said.
The structure had since changed, allowing DCHL directors to also sit on the boards of the major CCOs, such as Aurora Energy, Delta, City Forests and Citibus, as existing board members retired.
Some directors also had not been replaced if it was deemed unnecessary, provided appropriate skills remained, he said.
That meant the board memberships now varied from four to six directors per board. Aurora and Delta had the largest boards, because of their complexity, Cr Hudson said.
He believed it would be possible to further reduce the size of the boards, if there was a political will from the council, but cautioned against such a move.
"I think the skill sets that are on the boards at the moment are very good and leave the companies in the best possible position."
Mr Cull said, when it came to restructuring the boards, "anything's possible".
That included having fewer directors, although he was more interested in matching directors' skills to individual companies.
"The kind of skills you need to run City Forests should be quite different from those to run the DCHL board ... You would want, I would have thought, different skills.""The cost of paying boards of directors wasn't a part of the issue. In fact, there's an argument to say 'go for really good people and pay them more'.
"If you pay peanuts, you get monkeys."
Restructuring the boards, examined in the Larson report, was due to be discussed at next week's full council meeting.
Cr Hudson said the Larson review's findings had been given to the DCHL board for comment and council acting chief executive Athol Stephens had asked for responses by noon on Monday this week.
Cr Hudson said he could not discuss the detail of the report, which remained confidential until next week's meeting, and Mr Cull has declined to release copies ahead of the meeting.
However, Cr Hudson said the DCHL board "in general supported" the report's findings, and had said so in its responses, but those had been "pre-empted" by Mr Cull's decision to go public last week.
"That's why we were disappointed ... because, in general, the board supported a lot of the comment of the Larson report."
Mr Cull said on Friday he had not discussed the release with Cr Hudson, but he had been interviewed about the situation during the reviews.
It was important to remember the review was done "of DCHL, not with them", Mr Cull said.
DCHL chief executive Bevan Dodds said the board structure was determined by the council, as the only shareholder, but each company was legally required to have a board of directors.
"How you structure that is up to the ownership, which is the shareholder, which is the council.
"The council ... as long as it stays within company law and the law that governs things under the Local Government Act, can do what it wishes."
