Monthly Archives: March 2015

Boards overboard and other broader debates

Is overboarding (being on too many Boards or holding too many Chair positions) an issue?

Everyone seems to be joining the debate about Board Directors lately. Journalists, analysts, shareholders, as well as the corporate governance industry, are all jumping on the NED (Non-Executive Director) bandwagon. What are the hotspots causing excitement? Well, it’s tenure, independence, diversity, disclosure, remuneration or even the number of Board positions held. Undoubtedly all of those concerns carry weight in the search and selection process, which simply underlines the need for those of us called upon to source independent directors to get the right people onboard.

Companies such as Crown, Telstra, and PBL have all been under scrutiny recently for the tenure of their Chairs. Ramsay Health, Sonic Healthcare and QBE have long serving directors – all over 20 years. It goes to the heart of the independence question and many commentators argue that a director on a Board for over 10 years may no longer be sufficiently removed from the performance of the company to be independent and therefore, offer unbiased advice. Remember OneTel and HIH? Directors must be able to identify irregularities and/or poor governance.

While this debate continues to rage, I prefer to focus on the value a director brings to the business, which should not be limited by their tenure. A director who brings high level expertise, judgement and dedication to the table allows a CEO to make good decisions and steer the business in a positive direction, which in turn benefits the company and therefore its shareholders. That’s bringing value.

Amongst the questions NEDs should ask themselves when committing to a Board position is: Will I have time to prepare for as well as attend meetings, factoring in the likelihood of dealing with a takeover, acquisition, shareholder revolt or the like?

The plus side of multiple or simultaneous board roles is the experience and exposure to a myriad of issues that positively contributes to a director’s performance.

The word cosy is used in the pejorative with reference to boards. Board directors need to hold each other accountable for each other’s performance and that requires experienced, objective decision-making. Again it’s not a question of the number of Board positions a director holds, rather a focus on performance.

Here’s a tricky one. Some directors hold a minimum number of shares to ensure ‘skin in the game’. Therefore, they too feel the pain (or gain) of the shareholder when making decisions at Board level for the company they have invested in. The problem with that is too great a shareholding means you end up thinking about your back pocket.

Similarly, can directors be genuinely independent (and therefore offer sage advice to a company) when the information on which they rely to make independent decisions is provided by the CEO and executive team. Paradoxical don’t you think?

I’ll examine disclosure, reference checking and remuneration in my next article, so let’s finish with some good news.

Diversity on Boards is up. Rising from 18% to 20% (female representation) as of December 2014 for the ASX Top 100 and lifting another one percent from 16% to 17%  for all listed companies. This modest improvement in gender diversity on Australian Boards supports better performance, as evidence shows that gender equity on Boards makes for better performing companies. Good  governance results in prudent decision making and investments.

Have you held or are you currently in an NED role? What’s your Point of View on Australian Boards?

Posted in The world @work

Just because you are a character, doesn’t mean that you have character.

I don’t know whether I’m just getting a bit long in the recruitment tooth or not, but the question of character has been playing on my mind lately. I know so many people in business who are characters – they’re funny, engaging, witty, great to have a drink with and are endlessly entertaining. What I’m not seeing a lot of is genuine character – by that I mean characteristics that people admire and look up to – strength of character.

I value honesty and authenticity in people and I try to create an environment in my team where people can demonstrate their character, not to just be a character.

I had a candidate recently who lied to me about the roles that she was looking at. It made me reflect on my own behaviour and to consider whether I had created enough rapport with her that she felt that she could talk to me about what she was looking at. It’s important to me to always look at what I do that contributes to a situation – either positive or negative. The truth was, there was nothing that I could do, the candidate just didn’t have the strength of character to be honest and to tell the truth. Sadly, I’ve seen so much of it over the past few years, just a complete lack of integrity and even more disturbing, a win at all cost mentality, regardless of the consequences and it’s just awful.

Strength of character is standing up for yourself even when you know that you may be unpopular, it’s telling the truth when lying may be a more lucrative solution in the short term and it’s telling someone how you feel when they may not like what they hear. The best people I know in business have character in spades, they’re strong characters who are memorable for their convictions and for the way that they stand tall against opposition. Some are characters, and some are not, but the genuine character underneath always shines through.

Are you someone who is a character or do you have character? Will your colleagues, clients or prospective clients and employees remember you for your qualities and attributes, that you push back or question something because it’s the right thing to do, that you try to do the right thing no matter what, or will they remember you as ‘quite the character’?

I know what I’ve seen work well, it’s tenacity and strength and courage, and I’d love to see more of it in business because I see quite enough characters on the TV.

This article was originally published on LinkedIn Pulse, 23 June 2014. Thanks to The Wolf and Mr Tarantino for providing the inspiration for this post.

Posted in Professional Support, The world @work

Seven Axioms of Leadership

Leadership is paradoxical. We know it exists – certainly we have all experienced it in one way or another, but differing perceptions of leadership result in differing ideas about what leadership is.

With a longstanding background in the recruitment industry, I’ve known many successful leaders, both in the commercial and public sectors. I’ve always been interested in the processes organisations undertake to identify leadership capabilities prior to recruiting and selecting their leaders. Back in 2000, as part of my doctoral research, I started investigating this process. It resulted in some interesting findings:

  • Perceptions of leadership are varied and those individual interpretations of leadership are enduring;
  • Interpretations of leadership are influenced by context, experience, beliefs, values, knowledge and other aspects that impact on forming such perceptions, and;
  • Organisations tend to focus on defining what leadership is, rather than determining what it is that their leaders are required to do.

Drawing upon my empirical research, including documented evidence and structured observation of a broad cross-section of industry sectors, I have distilled the essence of leadership to seven axioms, an axiom being a statement or proposition that is regarded as being evidently true:

Axiom 1: It’s not about defining leadership, it’s about what you want leadership to do.
We often hear the old catch cry when things are not going to plan or individual expectations are not met ‘We need some leadership around here’. My retort is always ‘Tell me, what is it you want this thing called leadership to do?’ It makes for a clearer understanding of leadership expectations and assists in clarifying goals and objectives, expected outcomes and what needs to be achieved through leadership in the given situation or context.

Axiom 2: Context is Critical.
Context is critical to leadership. It is the landscape creating a vast array of environmental influences. Each organisation or role exists in its own unique context and requires different capabilities to deliver an effective leadership outcome. Major cultural change, expansive growth opportunities, global presence compared to a local presence and demographic differences or skill deficiencies are just some examples of different organisational contexts requiring the application of different leadership capabilities.

Axiom 3: The application of capabilities is fundamental to leadership effectiveness.
Leadership as an activity demands outcomes. Delivering those outcomes will be dependent upon the application of particular capabilities. Capabilities are best categorised and identified under six elements of leadership – character, personal capability, interpersonal skills, leading change, focus on results and intellect.  By way of example, capabilities residing in the element of character may include trust, integrity, doing what one says he/she will do, treating everyone the same and following through on promises and commitments.

Axiom 4: The interdependency between role intent, performance outcomes and context will determine required leadership capabilities.
If clarity exists on the intent of the role (purpose), performance outcomes (deliverables) and the context in which the role resides, then we are able to determine the leadership capabilities required to deliver the performance outcomes to achieve the intent of the role in the context in which it resides.

Axiom 5: Having a leadership philosophy endorses an individual’s leadership brand.
A leadership philosophy is an important determinant of an individual’s leadership brand (personal brand), which is how they want to be seen, as well as how they are going to act as a leader. If an individual wants to be seen as a leader for being strategic, championing change, and focused on results, then the articulation of the brand must be translated into action.

Axiom 6: To act like a leader one must think like a leader.
Effective leaders have the capacity to apply leadership thinking – the way a person thinks when applying themselves in a leadership situation. Leaders who do this well have the capacity to resolve wicked problems. A wicked problem is generally something that has not been encountered before and requires the application of such capabilities as sound judgment, problem solving, decision making, logic, strategy, negotiation and intuition

Axiom 7: Practising leadership ensures mastery.
As in all fields of endeavour, the key to effective leadership is practice. A measure of a leader’s effectiveness is the extent to which he or she achieves desired outcomes. Elite golfers play golf 20% of the time; they practice golf 80% of the time.

Of each of the axioms, context is particularly crucial to leadership because it denotes the landscape and terrain for a leader to manoeuvre. The context in which leadership is enacted further provides the stage and setting for the outcomes to be derived.

These Seven Axioms of Leadership continue to guide me when I am recruiting, selecting and coaching individuals for leadership roles. Knowing where an organisation is going means understanding what its leadership needs to do to achieve the outcomes required.

What’s your experience of leadership? Which one of these axioms resonates most strongly with you?

Posted in The world @work

A walk on the mild side: Melbourne’s marvellous mid-century multi-storeys

Modern architecture is a lot like modern art – you either love it or hate it. Working in a rapidly growing CBD with a relatively new built-up environment is a bit like wandering through an art gallery of ever-changing exhibitions. While Melbourne has preserved many of its old masters, modern building design has always been contentious. Mid-century design (circa 1945-1965) is currently enjoying a renaissance in interiors, but our landmark skyscrapers from the 1960s building boom haven’t enjoyed the same patronage.

A prime example sits right opposite my office: the former Suncorp building at 435-455 Collins Street (corner of William Street). Built in 1965 for National Mutual, it was considered pioneering at the time for incorporating a public plaza on private land. Now, the once sparkling marble facade is curtained-off in shame while the tower is being demolished. Unfortunately the experimental building techniques it employed haven’t stood the test of time and the building literally started falling down.

In an article in The Age City Office Tower Faces Demolition a year ago, Melbourne City Council’s Planning Chairman, Councillor Ken Ong said, “he believed the local heritage significance of the building was outweighed by its current state”. I don’t disagree with the critics on this one. Not only is the building an ugly eyesore in its present form, it’s also a painfully long demolition process for those that have to look at it every working day. Later additions to the Market Street tower would have horrified the original architects. Similarly, it’s karma for the loss of the 1841 Western Market on the same site – a tragedy for early Victorian heritage enthusiasts.

Late last year The National Trust published Melbourne’s Marvellous Modernism: A Comparative Analysis of Post-War Modern Architecture in Melbourne’s CBD 1955 -1975. It’s a fascinating look at the history of the city though the buildings of the mid-century period. From curtain walls to exposed structures, brutalist and international styles, those still standing make an interesting walking tour if you are outside in the city at lunchtime. ICI House (now Orica, at 4 Nicholson Street, East Melbourne) is Wallpaper City Guide worthy and the former BHP House (140 William Street), which echoes the famous John Hancock Center in Chicago, is one of my favourites.

Removing the much loathed Gas and Fuel building on Flinders Street was an emotional triumph for the Kennett Government in the late 1990s. It made way for the infinitely more popular Federation Square we enjoy today. I would love to swing a wrecking ball at the 1960s era Victorian Government buildings at 1 Treasury Place too, thereby restoring the open space around the Old Treasury where it meets Fitzroy Gardens.

As Melbourne grows upwards and our skyline becomes increasingly dense, we’ll soon be deciding the fate of other buildings that were conceived to house office workers in the 1960s, some of which are still in use today. As attention turns to the 70s, 80s and 90s, languishing skyscrapers from later architectural periods could even be back on the cool list. Of course a superficial look at aesthetics  from the ground says nothing about what it’s actually like to work in a building that’s 50 years old… you’ll have to tell me.

Next time you’re rushing through your city, take a moment to look up. Depending on your point of view, you may be delighted or horrified by what towers above you.

What are some of your favourite office buildings in your city? Which ones would you love to revamp?

Posted in The world @work