AUGUST/SEPTEMBER 2015 a perfectmatch? Sport andbusiness – board AT THE I LEADERSHIP NEW I Start-ups directors in call for skills special TABLE THE AT ANGELS YOU PAY ADIRECTOR? RESULTS –HOW DO MUCH o D DIRECTORS’ SURVEY FEES

o D Spreading your wings with digitalknow-how

New Zealand solutions to global foodproblems

room Magazine of the Institute of Directors in New Zealand of in Magazine Institute of the Directors

how prepared are you? The perfectmedia storm – Directors wanted for board vacancies

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9 Agent for change 10 A voice for good governance 12 Angels at the table 17 Directors’ Fees Report 12 Angels at the table reveals more work Fledgling and high-growth companies call for the money for a particular set of skills and experience 18 How to be a bird not a dinosaur in their directors. 21 Governance Leadership Centre update 23 Playing the game 26 Surviving the perfect storm 30 Digital identity and the cost of doing business 32 How to network 34 Local solution to global food safety challenge 36 Living up to potential 38 Making a smart move 40 Health and safety reforms – the key changes 46 Playing a strategic game

INSIDE IoD 26 Surviving the perfect storm 5 CEO Report Social media has added an edge to a media crisis 6 Update 42 Branch Events 44 Branch News 47 Continuing Professional Development

Institute of Directors in New Zealand (Inc) Mezzanine Floor, 50 Customhouse Quay PO Box 25253, Wellington 6146 New Zealand tel: 04 499 0076 23 Playing the game 28 How to network fax: 04 499 9488 Sport and business – a perfect Top tips from life’s natural email: [email protected] match or issues to smooth out? networkers www.iod.org.nz

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Institute of Directors (IoD) boardroom is published six times a year by SENIOR MANAGEMENT TEAM COUNCIL 2015 the Institute of Directors in New Zealand Chief Executive Officer Michael Stiassny, President; (IoD) and is free to all members. Subscription Simon Arcus Liz Coutts, Vice President; for non-members is $155 per year. Dr Helen Anderson, Wellington; Manager, Membership, Margaret Devlin, Waikato; boardroom is designed to inform and Marketing and Communications Julia Hoare, Auckland; Alan Isaac, stimulate discussion in the director Nikki Franklin Wellington; John McCliskie, Nelson community but opinions expressed Manager, Governance Leadership Centre Marlborough; Ray Polson, Canterbury; in this magazine do not reflect IoD (Acting) Glenn Snelgrove, Bay of Plenty; policy unless explicitly stated. Felicity Caird Geoff Thomas, Otago Southland; Editor, Katherine Robinson 027 5639 686 Clayton Wakefield, Auckland Corporate Services Manager or email [email protected] Chris Fox COMMERCIAL BOARD Advertising Manager, Pamela Graham General Manager Commercial Ray Polson, Chairman, Michael Stiassny, 027 4333 818 Tim Allen Dr Alison Harrison, Rangimarie Hunia, boardroom is designed by Strategy Design Catherine McDowell, Simon Arcus Branch Network Manager & Advertising, www.strategy.co.nz Peter McLellan

Institute of Directors in New Zealand (Inc) Manager Chartered Pathway Mezzanine Floor, 50 Customhouse Quay, Tony Southall PO Box 25253, Wellington 6146, The Institute of Directors has staff based at the National Office in Wellington, New Zealand Tel: 04 499 0076, an office in Auckland, and eight branch managers operating from their localities. Fax: 04 499 9488 Email: [email protected] For National Office, telephone 04 499 0076. For branch managers’ contact details www.iod.org.nz see Branch Events, page 43 boardroom is pleased to acknowledge the support of sponsors ASB, Marsh, Chapman Tripp and KPMG.

asb.co.nz, 0800 803 804 marsh.co.nz, 0800 627 744 chapmantripp.com, 04 499 5999 kpmg.co.nz, 09 367 5800 BOARDROOM | 5

CEO REPORT

Unsung heroes It’s the work behind the scenes that makes all the difference

ECONOMIC BACKBONE the fee. New Zealand needs directors 2015 has carried with it a theme of who are courageous but for whom the “A professional unsung heroes. As the backbone of risk and reward balance makes sense. association like the confidence in the New Zealand economy, IoD has members at the directors’ work is often unsung STRONG SUPPORT and it is a role performed largely A professional association like the IoD its beating heart” behind the scenes. New Zealand’s has members at its beating heart. Those prosperity is built on strong, long-term members have shared resolve about the performances from organisations across importance of professional standards. We’re also seeing a real hunger for They require a strong voice in governance our business and community sectors, governance expertise from the rural supported by professional development and directors are at the heart of this. sector. Our Rural Governance Essentials opportunities of the highest quality. The value of directors comes into stark course recently piloted in Invercargill. We focus as we release the annual IoD It’s critical that directors keep pace with added an extra course and had fantastic Directors’ Fees Report. The results make change, and the IoD needs to be relentless feedback from our first participants. We’re for interesting reading. The median fee in asking what a modern membership looking forward to rolling this out across for a director in a New Zealand-owned entity should look like and what delivering the country, with courses in Hamilton, firm is $37,000. Compare this to $99,625 value back to members should represent. Christchurch and Palmerston North next. The best thing about these courses is they for an overseas-owned organisation. This Interest in our new Leading in a Digital Era are driven by farmer demand. People are comes at a time when the compliance and course has been strong and we’ve already calling the IoD to ask for this in their region. liability framework seems increasingly added several more courses across the complicated, and we see a 41% increase in country. The key to this course is not OUR OWN UNSUNG HERO the median time commitment for directors. just the ‘hot button’ issue of cyber risk, Members consistently tell us that but also understanding what ‘digitising’ Director remuneration is a contentious boardroom is one of the membership your business might look like. What is subject, sometimes occluded by benefits they value most highly. a digital director for the modern era? assumption and conjecture. Some That it is so highly regarded is a tribute negative commentators know the price The IoD is duty-bound to support good to the talent of boardroom editor of a director but not much about the governance practices and we have just Katherine Robinson. The work that goes value of governance. We pay directors to released the Cyber-Risk Practice Guide, into publishing a magazine of this calibre do the right thing, not the commercially to help directors monitor cyber-risk. This is considerable, and it could not go to safe thing, and a good director is worth guide is publicly available from iod.org.nz. print without Katherine’s hard work. 6 | BOARDROOM

Update

MOVING ON Outstanding

The IoD congratulates the following members on these board Business Leaders appointments: The IoD lost three outstanding business leaders recently and we would like to offer our sympathies to their friends David Flacks has been appointed Chartered Member Helen and families. to the board of the New Zealand Robinson has been reappointed Venture Investment Fund Ltd Chair of Network for Learning, Craig Norgate (NZVIF.) while Chartered Member Mark Chartered Fellow Craig Norgate died in London on 7 July, aged Yeoman has been reappointed 50. Craig is probably best remembered as CEO of Fonterra but Deputy Chair. Also reappointed he also headed Kiwi Co-operative Dairies, PGG Wrightson and Chartered Fellow Linda Robertson are Chartered Member Rick Shera Chartered Accountants Australia and New Zealand. Among has been appointed to the board and Members Linda Tame, Martin his many governance roles, he was a director of Port Taranaki, of King Country Energy Ltd and Wylie and Jack Matthews. Sealord Group and the New Zealand Rugby Union. KCE subsidiaries. Sir John Ingram Chris Bishop joins IoD Members Distinguished Fellow Sir John Ingram died in Auckland Elaine Cook and Jeremy Hood Rob Lee and Bennett Medary on on 1 April, aged 90. An engineer, Sir John’s many have been appointed as directors the board of NZTECH. directorships included appointments to the boards of the Southern Dairy Hub. of IBM and the National Bank. He was a pro-chancellor of the University of Auckland, and a president of the Chartered Fellow Graham OTPP New Zealand Forest Auckland Manufacturers’ Association. Crombie has been appointed Investments Ltd has appointed Associate Member of the Sir John Todd Chartered Fellow Jane Taylor and Commerce Commission. Distinguished Fellow Sir John Todd died on 29 July, aged 88. Traci Houpapa to its board as Chairman of his family’s charitable Todd Foundation for 24 directors. years, Sir John will be remembered as one of the country’s Dr Kathie Irwin has been top philanthropists and a leading patron of the arts. reappointed to the Te Wananga Associate Member Richard o Aotearoa Council. Alderton joins the SeaDragon board. IoD BY NUMBERS* Chartered Member Jackie Lloyd has been appointed as a council Chartered Member Bevan Killick member of the combined WelTec FRSA has been appointed to the 674 19 777 Whitireia Polytechnic Council. board of the Royal Society of IoD members mentees in the IoD participated in 2015 Mentoring members Arts, Australia and New Zealand the Directors’ for Diversity under 40 at and reappointed to the board of Sue McCormack has been Fees Survey programme 31 July Southern Response Earthquake reappointed as a member of the Services Ltd. University of Canterbury Council. 683 100% Anne McLeod has been appointed new members of Rural Governance to the board of SBS Bank. in 2015 Essentials participants would recommend the course to others

* Correct at time of publication BOARDROOM | 7

Congratulations to Rural governance a winner Emerging Directors The new Rural Governance Essentials course piloted in Invercargill last month has proven a great success. The one-day course, which Winner of the Waikato Emerging Director Award was demonstrates the practical value of a board for those working James Yearsley, who impressed the judging panel with in agribusiness and farming, is scheduled to roll out across the both his business acumen and involvement in community regions. We can confirm three new dates: activities. James is owner/director of ICARAS and founded the Tamahere Dad’s Army – a non-profit group that Christchurch: 27 October undertakes work at the school and the community. Palmerston North: 10 November Hamilton: 24 November Bryan Graham has been named winner of the Bay of Plenty Aspiring Director Award, recognising him as a future talent at the board For more details and to register, visit iod.org.nz table. Bryan is a Science Leader at Scion, the Crown research institute charged with driving innovation and growth in forestry.

Richard Thomas became the first Queenstown recipient of the Otago Southland Emerging Director Award. Richard SAVE THE DATE is currently Skyline Enterprises Ltd director and deputy chair of the Queenstown Chamber of Commerce. IoD Leadership Conference boardroom will be catching up with all the IoD’s 12-13 April 2016, The Langham, Auckland Emerging Director Award winners in a later edition this year. For more details see iod.org.nz

directorVacancies is a cost-effective way to reach IoD members – New Zealand’s largest pool of director talent. We will list your vacancy until the application deadline directorVacancies closes or until you find a suitable candidate.

MARITIME NEW ZEALAND AOTEAROA NEW ZEALAND SAFE (SAVE ANIMALS Role: board members ASSOCIATION OF SOCIAL WORKERS FROM EXPLOITATION) Location: national Role: board member Role: three board members Applications close: 28 August Location: national Location: national

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 Applications will remain open  Applications will remain open NETBALL NEW ZEALAND until position is filled. until position is filled. Role: appointed director Location: Auckland COUNSELLING SERVICES CENTRE You’ll find more directorVacancies Applications close: 18 September Role: board member advertised on the IoD website, in the Location: Auckland AUCKLAND DIVING COMMUNITY TRUST monthly directorVacancies email

 Applications will remain open Role: two trustees distributed to IoD members and on until position is filled. Location: Auckland the IoD Twitter feed, @IoDNZ.

 Applications will remain open until position is filled. IN BRIEF Michael Stiassny has a long and distinguished governance career in both private and public companies. He is currently Chair of Vector Ltd, TOWER Ltd and Ngati Whatua Orakei Whai Rawa Ltd; and director of NZ Windfarms Ltd and DNZ Property Trust Ltd.

He is senior partner for KordaMentha, specialising in restructuring and forensic acoountancy. He is a founder member of the 25 Percent Group and Future Directors. A Chartered Fellow, Michael was Vice President of the IoD from 2013 to 2015. He holds a BCom and LLB from the University of Auckland. BOARDROOM | 9 NEW LEADERSHIP Agent for change A progressive voice in governance, Michael Stiassny was elected President of the IoD in June this year. He talks to boardroom about the IoD’s transformation to a modern professional body and his plans to take the organisation to the next level

A senior partner at KordaMentha, Michael “We must adhere to our professional values Stiassny has a reputation for being and only promote those things that relate “Long-term change someone who is able to spot what is to governance. Unfortunately, some of our comes about by people wrong with an organisation – and fix it. membership may want us to advocate for Restructuring is his specialty and he has them rather than for the profession, so to understanding and been involved in many complex, high-profile speak – there is a distinction,” he says. believing in that change.” assignments. He can draw on over 30 years Health and safety reform is a case in point. of governance experience and as a long- If a senior director mentors a young Michael’s long experience working in term member of the IoD’s National Council, person or someone of different ethnicity, hazardous industries has made him acutely including a recent term as Vice President, they will realise that other people have aware of the need for workplace health he has been a strong supporter of moves many things to add to the discussion.” and safety. to modernise and professionalise the IoD. Greater diversity could also “I think improving health and safety “In essence, the IoD used to be a club – an old widen New Zealand’s small pool is something we should all do for the boys’ club. And it is still perceived as a club of independent directors. betterment of New Zealand – every to a certain extent outside the organisation. employee deserves as safe a workplace “New Zealand is a village, really, with Within the IoD, we may think that we have as is reasonably possible. However, that relatively few directors. We do need to made progress and eradicated the old boys’ means that the responsibilities and think very seriously about people who club, but we need to ensure that this is well obligations of directors will increase, sit on more than one board together. communicated to the outside world,” he says. and not all directors are in favour. The It can mean that you become too He sees the establishment of the Chartered IoD’s role must be to promote health and comfortable with each other’s thought Membership pathway last year as a dramatic safety but in such a way that it allows processes and you don’t challenge step forward, transforming the organisation everyone to grow into it rather than each other the way that you should. from ‘club’ to professional occupational body. feeling that they are forced into it.” Boards also need to understand what is happening out in the wider world.” “We’ve made progress, but we need to make Both within and outside the IoD, Michael far more progress. The IoD made a huge has been a driver for change, particularly on And that’s never been more change with the Chartered Membership diversity. He has been a regular mentor on imperative than now, with disruptive pathway – it’s so big a step that I don’t the IoD’s Mentoring for Diversity programme, technologies reshaping the way think anyone really appreciates the is a founder member of the 25% Group, and we live, work and do business. magnitude of the changes that it will bring. in 2013, he founded Future Directors with “These are the most exciting times Sir Stephen Tindall and Des Hunt of the “I am usually in a hurry but I am well aware for our generation, we are witnessing New Zealand Shareholders’ Association. that this is something that will take time. a revolution. Directors need to Chartered Membership needs to bed down “I am committed to diversity of thought understand the key drivers in this so for it to have real longevity,” he says. because it leads to better decision-making. that they can play a significant role in I do support getting more women on maximising the benefit to shareholders Part of Chartered Membership’s boards but it is only one of many kinds of and ultimately New Zealand Inc.” success hinges on its benefits being diversity. Gender was the obvious place to effectively communicated to membership. There’s no doubting that Michael cares start, but the discussion must be widened Communication in general, he believes, about governance and the long-term to look at what diversity really means.” is an area where the IoD should be future of New Zealand. As chair of stepping up to take more of a leading Programmes such as Mentoring for Ngati Whatua Orakei Whai Rawa Ltd, he role in advocating on governance issues. Diversity or Future Directors benefit believes in the Maori model of planning boards as much as the emerging directors ahead for the generations to come. “This is already happening to some extent. they are designed to help, he says. We have the genesis of advocacy with “On a personal and social level, I believe the establishment of the Governance “Ultimately, these programmes will break in that mindset of making decisions for Leadership Centre last year, but I down the club mentality in the boardroom. mokopuna or grandchildren. I think we would like to see the IoD speak out on Long-term change comes about by people would all wish to make New Zealand more issues relevant to directors. understanding and believing in that change. a better place than we found it.” 10 | BOARDROOM A voice for good governance Simon Arcus, the IoD’s newly appointed CEO, steps into the role with a solid foundation of experience to draw on and a mandate to raise the IoD’s profile. Putting theory into practice is how you We are a small, close-knit team at the could describe the IoD’s newly appointed IoD; many staff were deeply upset. On “Economies are about CEO Simon Arcus’s journey at the IoD. A the first day back we closed the office confidence. Directors lawyer and qualified company secretary, at midday, but I was struck by how most are the backbone of Simon first joined the IoD four years people stayed on and worked through.” ago to update the our publication, The that confidence. I am Simon sees opportunities in building Four Pillars of Governance Best Practice. on strong foundations laid down not afraid to say that On its completion, he took up the role by initiatives such as the Chartered directors are worth it.” of Board Services Manager, facilitating Membership pathway. “It has the power board reviews and consulting with to transform governance in New Zealand “I was dealing with cases that were directors in the corporate, public, by offering credible benchmarks for front page news, and taking calls from iwi and not-for-profit sectors. expertise and experience. Our focus is people in dire situations. There were to keep on communicating what it will “I’ve enjoyed the people contact. We heartbreaking personal stories, but the have an incredible membership at the mean for directors and stakeholders, role was character-forming,” he says. IoD – highly diverse, from all sectors as we will with other IoD offerings. A move to Sydney followed, where and backgrounds. It’s been a privilege “We have led the way on so many issues roles included a position with the getting to know them,” he says. relevant to directors – diversity, health Law Society of New South Wales. He Simon went on to establish the IoD’s and safety reform, cybersecurity and returned to Auckland to work as thought leadership hub, the Governance rural governance. These are current National Liability Claims Manager for Leadership Centre (GLC), becoming GLC governance challenges – and we Marsh just as the GFC was unfolding. manager when it launched last year. are able to offer good solutions.” “It gave me an insight into just how “We live in a world where you can google Simon has represented directors’ interests critical governance is to the success corporate governance on the internet and at select committee hearings, and of any venture. Systemic market find data of varying quality, but through has often been in the media spotlight failure beats a well-trodden path back the GLC, our objective is high quality since taking up the reins as CEO. to systemic governance failure.” resources targeted to help New Zealand “I believe in the director value proposition. Simon has first-hand governance directors do their job. It’s practical. Our Directors play a pivotal role in instilling experience through a board position members aren’t theorists – they are and sustaining confidence from the on the Cancer Society of New Zealand, out in the field. I found that there was market and shareholders. A board not which he has held since 2012. plenty of support for the GLC. One thing only holds management to account that I have really appreciated about but keeps management in check from “The insight into the other side of the the IoD is its appetite for change.” short-termism and self-interest. table has been invaluable. Our courses talk about ‘noses in and fingers out’ on Change is never without challenge, and “Economies are about confidence. a board but new directors need to learn the most demanding time for Simon came Directors are the backbone of that that discipline, especially where they are as a lightning bolt shock when he took on confidence. I am not afraid to say problem solvers and action-oriented.” the role of Acting CEO after the previous that directors are worth it.” CEO, Dr William Whittaker, died suddenly Based in Wellington where he last November. William was not only the Simon’s firm belief in good governance lives with his husband Dr David CEO but also a friend. “It was an enormous stems from a career that spans the Paterno, Simon is frequently on the test of leadership because it came without insurance and communications road spreading the IoD message at warning or precedent – I don’t know of industries, and the public sector. branch events across the country. anyone who has been in a similar situation. An ex-Head Boy at Wellington’s Scots “Spending time with membership “We live in a media age where the IoD College, Simon says that challenging matters but readers will know the community knew about William’s death in leadership roles have tended to find diary is a juggling act. Governance is hours. The imperative is to be fast-moving him. He graduated with an LLB/BA really about good planning, strategic and responsive. One thing that really hit from the University of Otago, and vision, processes and systems. It’s an home for me was having to juggle the went on to work for the ACC in the enduringly good message, and one that personal and the professional response. contentious medical treatment area. I’ve noticed people are keen to hear.” BOARDROOM | 11

“Without directors there would be a huge hole in what makes an economy tick. I wouldn’t be afraid to say that directors are worth it.”

IN BRIEF In 2014, Simon Arcus established the IoD’s Governance Leadership Centre, which incorporates research, policy and advocacy on governance issues. He also works for the IoD’s commercial arm, providing boardroom training and governance advisory services. In 2012 he re-wrote the IoD’s foundation guide to governance, The Four Pillars of Governance Best Practice. Simon has an LLB/BA from the University of Otago and a Postgraduate Diploma in Business from Massey University. He is a Senior Associate ANZIIF and a Chartered Company Secretary. Simon has held management roles in the insurance, regulatory and public sectors and is a director on the board of the Cancer Society of New Zealand. Angels at the table If there is a risk a company might fail and it almost certainly won’t have any spare cash for the first few years, who would take a seat as a director? Why, angel investors of course. Amy Williams reports on the emerging start-up sector BOARDROOM | 13

This is the scenario. You’re a director on a start-up company that has the potential “The human side of to go global, but it’s crunch time. A big growth companies is order the company needed to break even this month has fallen through. You far harder in governance ask the chief executive and manager than in a mature to wait another month for their pay. company. It’s far Former Kiwibank chief executive Sam Knowles is actively involved in easier to be objective growth company governance, and and dispassionate if this type of situation is why he works only with founding entrepreneurs who you’re dealing with a are prepared to work for nothing and management team will not leave a director stranded. of professionals” “It can be highly risky. You can expect at some point to be worried about what you do relative to the risk of whether you can The Angel Association New Zealand meet payroll next week,” Knowles says. (AANZ), for instance, has more than 600 members. Each year, they invest around “It’s a different playing field. If you $50 million in about 100 deals. Many of don’t like risk, don’t do it. You’ve got these angel investors take positions on to be totally comfortable operating boards, after investing through clubs and around ambiguity of futures and risk.” funds. Typically, a club of angel investors Knowles says directors of fledgling will raise around $500,000 each capital- and high-growth companies need raising event, with individuals investing different experience and skills to between $20,000 and $100,000. directors of established companies. The angel investor clubs have 10 to 150 Certainly, not all companies get the right members and of them, those who are the advice. Business incubator The Icehouse best qualified will take on board positions. released results from a survey last year that showed a lack of external advice THE JOB DESCRIPTION is leaving Kiwi businesses vulnerable A job description for a director of a start- and creating a higher potential for up or high-growth company would likely failure if they try to launch overseas. mention being comfortable with taking on different roles at different times. Nearly two thirds of the 346 companies that took part in the Businesses of The chairman of the AANZ, Marcel van International Quality Barometer received a den Assum, says it is active governance red light for governance and the strength (he is a director of Flick Electric, CropX, of the advice they were receiving. MerlotAero and SimplHealth).

Although the area of governance “It’s not passive governance, you have to among start-ups is growing, it is still roll your sleeves up and engage with early an emerging and rare skillset. adopters and shareholders,” he says. 14 | BOARDROOM

gotten close to the wire and he has asked “If you haven’t done commanders to work without pay.

it before, you don’t That’s particularly tough when the understand that when chairman might then have to tell you’re growing fast you’ve this same founder they are not the right person to lead the company got to fundamentally into its next stage of growth. reinvent the organisation “The human side of growth companies Debra Hall about every 18 months” is far harder in governance than in a mature company. It’s far easier to be objective and dispassionate if you’re innovation and a culture of managing risk dealing with a management team of is important for a company’s growth. professionals who understand that you “The primary role of governance in restructure every couple of years and start-ups is to increase the probability people lose their jobs,” Knowles says. of success by systematically reducing Van den Assum agrees, saying sometimes the risks,” says Knowles. companies need to be wound up and He uses four C’s to describe the different that also requires wisdom, including Marcel van den Assum risks facing these start-ups – capital, knowing when to call time. capability, culture, and commander. “In failing, again, you’ve got to do that “There is significantly more uncertainty with good governance. You’ve got to fail so the classic risk management that the right way. It’s really important.” you would use for a big company isn’t applicable, in that most decisions ON THE GROUND are risk management decisions. In a Only one in ten start-ups succeed mature company you’re doing small significantly, with the rest breaking even, things to change revenue and cost.” failing or making some return for investors.

Sam Knowles Start-ups generally have cost and no A high-growth company will typically have revenue certainty. Knowles also says a double digit monthly growth in revenue, commander (founder CEO) is all-important user numbers or transaction numbers. “The fundamentals of good governance in that they often do everything to start Knowles says this type of expansion apply across the board and the Four Pillars with, but may not be the right person to requires specific skills and experience that the IoD refers to [determination take the company through the next phase. around the board table. of purpose, an effective governance “A commander may not have had that culture, holding to account, and effective “The more we get into it, the more we learn experience and that’s where governance compliance] are just as relevant in start- that the general all-round skills that a comes in. Probably the biggest challenge ups as they are in established companies.” director has are only a very small part of a of governance is getting the people in the requirement of a fast-growing company.” Because start-ups are less mature, organisation to understand they haven’t entrepreneurs need more mentoring got the capability and experience to He says growth company boards need and coaching as there is usually do what’s required for the next phase, people with skills in the company’s a gap in their capabilities. and going out and finding the people industry, strong financial expertise, who are needed for that phase.” general governance experience, and Directors also need to have a good someone with experience building appetite for risk, and know how to With regard to capital, Knowles says a company and managing risks. manage it judiciously. They need to know it is about directors making sure they how to raise capital for a company and have enough funds to execute the “My expertise is how do you manage the get the right experience and skills on a next phase; capability is about finding risks of going from five people to 200 board for each phase of the business. people with the right experience and people and what processes do you get in skills before the company needs it. place to actually get bigger,” Knowles says. Knowles says his experience in Kiwibank, which he grew from scratch to profit Knowles says he hasn’t had to shut any “If you haven’t done it before, you don’t within five years, showed him that companies down, but at times it has understand that when you’re growing fast BOARDROOM | 15

you’ve got to fundamentally reinvent the start up to one of the country’s leading for the first few years. More often than organisation about every 18 months.” market research consultancies. not, directors are paid in shares until the company can afford to pay cash. Fellow start-up director Debra Hall She says her entrepreneurial experience says this overhaul extends to the is useful on these high-growth boards. The angel investment community is boardroom. She’s a director at lingerie “Those skills have been really transferable therefore filled with people who want firm Rose & Thorne Design, and sits on into providing support. Those skills go to give something back to help others the advisory board at Data Insight. with you, but there are mechanisms and the wider business sector. for learning core governance skills.” “The company is moving so fast that Hall says she is in growth company the skill set required from the board Hall says directors of high-growth governance because it is exciting and changes really rapidly. The early companies are always looking to challenging, and she likes the idea of stage board has a very different role raise money, and this could be via being involved in companies that may compared to subsequent boards.” selling equity to private parties or shape this country’s future growth. by publicly listing the company. Hall is actively involved in the MORE INFORMATION early stage investment community “We do all the important things that If you are looking to establish an and is a former member of the directors have to, but the lens that we advisory board or a full board for advisory board of ICE Angels and do them through is really overlaid by this your business, visit iod.org.nz/ the national council of the AANZ. primary objective to grow fast and get FirstBoards for resources, including out for the early investors,” she says. toolkits and case studies. Governance is something Hall became interested in after selling her own As for the question of remuneration, business in 1992, having taken it from directors of start-ups are rarely paid Take it to the next level – a public listing What is involved in being on the “A public listing is highly complex. This PUBLIC COMPANY DIRECTORSHIP board of a public company? course will empower directors with Key areas covered include: What are the differences between a good working knowledge that they • 1 hour webinar: can build on. If they are looking to -- the IPO process and IPO preparation operating as a private company publicly list their business, or if they • Full day workshop: and as a listed company? How can are seeking appointments to listed -- choosing the right advisors and you avoid a disclosure breach? company boards, this programme will understanding their roles To answer these and other questions, help them achieve their business and -- information for investors the IoD, with global law firm DLA career goals,” says IoD Professional -- managing the relationship with the Development Manager Helena Gibson. regulators Piper, is launching a new one-day -- board readiness – governance and The course is supported by NZX and the workshop and webinar, Public diversity FMA, and like other Director Development Company Directorship. courses, involves experienced listed Course dates Aimed at new or aspiring directors company directors. Mark Verbiest, chair The webinar is to be held 3 November, wanting to grow into a public company of Spark NZ, Transpower, and Willis Bond 2:30pm - 3:30pm. The one-day workshop directorship as well as directors in Capital Partners, and Joan Withers, chair is to be held in Auckland on 12 November. organisations considering listing, the of Mighty River Power, TVNZ and a director For more information and to register, course introduces directors to the of ANZ NZ, will be sharing insights and visit iod.org.nz regulatory environment in which a public answering questions at the Auckland event.

company operates and the distinct characteristics of a public company. Board evaluation done better Best practice boards commit to evaluation for continuous improvement.

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For further information www.iod.org.nz IOD13713 BOARDROOM | 17

MEDIAN FEE Board evaluation Directors’ NON-EXECUTIVE DIRECTORS done better Fees Report $45,000 Best practice boards commit to evaluation reveals more $40,000 for continuous improvement. work for $35,000

BetterBoards is an online evaluation $30,000 tool that helps boards identify their the money 2010 2011 2012 2013 2014 2015 strengths and weaknesses, assess their performance, and determine The Institute of Directors’ 2015 opportunities to become better at Directors’ Fees Report shows directors’ MEDIAN FEE what they do. fees have risen moderately this year NZ-OWNED / It is simple to set-up, easy to use, OVERSEAS-OWNED but workloads have almost doubled, (NON-EXECUTIVE DIRECTORS) and accessible across mobile web reflecting an environment where platforms. The evaluation reports are comprehensive, easy to follow, boards are facing more scrutiny and and accompanied by an overview regulation than ever before to assist the chair in leading IoD CEO Simon Arcus says although the median non-executive post-evaluation discussions. directors’ fee increased by four per cent, most directors (88 per cent) saw a median increase of 41 per cent in time Additionally, boards can choose to commitment. have an IoD facilitated discussion to $37,000 $99,625 “Finding the right balance between risk and reward is critical explore the board’s current situation to attracting skilled, competent and diverse talent to your and determine future direction. board table,” says Simon.

BetterBoards is the only board “We think there could be pressure on director remuneration evaluation tool that shows how levels in an era of increased liability and compliance. THE AVERAGE NUMBER OF Our members tell us the burden of compliance has your board is performing against BOARD MEETINGS A YEAR grown. What New Zealand needs is highly skilled, 8 the IoD’s comprehensive reference fairly remunerated directors. It’s not enough to say guide for directors, the Four Pillars there are plenty of directors lining up out there: New of Governance Best Practice. Zealand needs a focus on quality not quantity.” This is the first year that the IoD has worked with EY to years 2015 Contact us at undertake the annual IoD Directors’ Fees Survey, and this AVERAGE LENGTH OF [email protected] year saw a 27 per cent increase in survey participation, 4 DIRECTORSHIPS or phone us on 04 499 0076 making it the most comprehensive in our history. to talk about your board “We pay directors to do the right thing, not the commercially evaluation needs. safe thing,” says Simon. “That can involve taking risks. New Zealand needs directors who are courageous but for whom the risk and reward balance in remuneration makes sense.”

In comparison, the survey showed a big jump in simple set-up accessible comprehensive fees for non-executive directors on the boards of 6 overseas-owned companies – the median fee for those THE AVERAGE NUMBER OF surveyed rose from $85,000 to $99,625 per year. DIRECTORS ON A BOARD The IoD’s 2015 Directors’ Fees Report is available to survey participants at a reduced rate of $350; For further information IoD members: $550; non-members: $650. www.iod.org.nz IOD13713 How to be a bird not a dinosaur Disruptive technologies are driving change at an extraordinary pace. And directors who are plugged into the digital world are in hot demand for their innovation and creativity. By Amy Williams BOARDROOM | 19

“If I was sitting on a board with plenty of governance experience in my current board structure, I would trade that off for a director with digital skills if I couldn’t find the complete package”

The world sat up and noticed when taxi digital directors), while 80 per cent had an internet connection, and about drivers took to the streets in France no digital directors. Not surprisingly, the 70 per cent of mobile users in New to angrily protest against Uber’s ride- highly digital boards were concentrated in Zealand have a smartphone that hailing app, which allows users to be the technology and consumer industries. enables them to access the internet. picked up by uncertified drivers. Mark says the risk of not being part of the TAKING STOCK It is this kind of disruption to the digital transformation is that a business Kiwis are traditionally early adopters status quo from new digital business can become irrelevant almost overnight. of technology, and given that tech models that will reshape the way companies are more likely to be leading “That’s where you start to see companies business is transacted in the future. the digital charge, it is logical to expect failing because in a nanosecond So where does this leave companies Spark, the country’s biggest telco, to things will change so rapidly they that want to be at the steering be part of this digital revolution. won’t know what hit them. wheel, driving change rather than Spark’s board is chaired by Mark “It’s something I talk about a lot, I almost burning their tyres in protest? Verbiest, a strong advocate for board try to scare people into it because in some Many forward-looking companies are diversity. He also chairs Transpower areas I just don’t think people are thinking looking at what digital skills they have New Zealand and is a director of ANZ about these issues and there is, in my view, around their board tables and see a gap Bank New Zealand, to name a few. insufficient emphasis placed on the rate for the new version of a digital director. and extent of change that’s going on.” Mark says there won’t be many areas The role has moved from simply or sectors in the world that will be Last year Ido Leffler joined the Spark knowing about the internet, to being left untouched by disruptive digital board. He’s a US-based entrepreneur completely plugged into the digital technologies. with experience developing digital world and able to give insight on a brands and extensive networks “The power of super-computing is full range of governance issues. in the start-up communities of enabling people who have no connection Silicon Valley and Australasia. Executive search agency Russell to a traditional business model to Reynolds Associates says over time, enter that business quite easily, or a Leffler is among a handful of digital digital acumen will become a standard portion of that business, and doing very directors appointed to Kiwi firms recently, expectation in boardrooms and C-suites. well before you can blink,” he says. including SKY TV, which now has high profile entrepreneurs Derek Handley It says evidence shows that companies “We see that very readily in the telco and Geraldine McBride on its board. that embrace digital transformation space and you’re starting to see outperform their peers across an that in other industries but I don’t VERSION 2.0 array of financial measures. think there is sufficient awareness The Russell Reynolds Associates study of how quickly things are changing Last year, the agency analysed the describes digital directors as those and will change going forward.” backgrounds of all board members who have had a significant operating of 300 large companies in the United He believes that’s why it is critical for just role in a digital company, a digital States, Europe and Asia Pacific, and about every significant business in New operating role in a traditional company, found digital directors are still an Zealand to gain digital skills at the top level. or have had two or more non-executive exclusive club and a number of sectors board roles at digital companies. Kiwi consumers are certainly able to are just beginning their journey. adopt new technologies – the most Craig Richardson has noticed the Only 10 per cent of boards in the study recent national figures show four out changing role of digital directors were highly digital (had at least two of five households have access to as part of his position as managing 20 | BOARDROOM

director of the serious crime fighting “The digital world is really just another “If I was sitting on a board with plenty software firm Wynyard Group. reflection of the natural world in which we of governance experience in my current live. I look at patterns and help companies board structure, I would trade that off for “What we are seeing at a board level is a figure out how to be a bird rather than a director with digital skills if I couldn’t realisation that that’s more than just a just another dinosaur in the ground.” find the complete package,” Victoria says. marketing capability and infrastructure capability. It’s about recognising the value And a key aspect of this is the customer’s “It’s better to have those digital skills of digital assets and that on a board there change in role from a passive end than try and look for someone that may needs to be someone who recognises user to an empowered consumer. not fit my view of traditional governance all the dimensions of that,” Craig says. experience.” “If you’re not centred on your customer and A digital director’s role takes into you don’t know them or have any data on Victoria says digital directors are a new account policy, privacy, marketing, them, then you will be out of business.” breed of leader. technology, legality and security. She sees her role as teaching companies “We have an opportunity to shape and “It’s bringing together a whole bunch to think about customers differently reshape the world because we are in a of skill sets and that’s unusual to find (“not stalking customers or being digital revolution.” in one person – on a board it would creepy and spying on them”) and to Who wouldn’t want to be at the steering be a number of people,” he says. build a physical and digital relationship wheel right now? with them based on the norms of a These digital savants are able to help a human relationship – permission, business spot opportunities, starting trust, having two-way conversation, with a company’s digital assets. transparency and mutual value. GAINING DIGITAL SKILLS “You can’t be the follower of a trend, It’s not a case of if but when your “If you can’t tick the box on those five you’ve got to be the exploiter of gaps. In business will be disrupted by new things, then again you are at risk of our case the big trends that crossed over technologies. This year the IoD being disrupted.” were big data and serious crime, and launched an interactive workshop that created an opportunity for us.” She says digital is about new business discussing the key drivers in the models. digital age, working through practical The Russell Reynolds study found case studies which will enable you digital directors are also often younger, “That’s what I talk to all my boards about to understand digital business more likely to be female than non- and that’s what I do in my daily life. cases presented to your board. digital directors, and likely to emerge This is the new digital revolution that’s from just a handful of sectors. going around the world right now.” The workshops have been hugely popular but there are still places Enter Geraldine McBride, who is best TALENT POOL on these dates and centres: known for her high profile career at the It’s little surprise that Geraldine’s 1 October, Auckland business software giant SAP, during which skills are highly sought after – she is 21 October, Wellington she was chief executive and president of frequently asked to join boards. 1 December, Christchurch the firm’s Asia Pacific, North American and 8 December, Wellington Japanese regions. Another company that has successfully attracted good digital talent is online For more information or to On her return to New Zealand, Geraldine listed accounting software firm Xero. register, visit iod.org.nz set up her own digital company, MyWave, and says it helps her to Xero Managing Director Victoria keep up with the pace of change. Crone says companies need to be MANAGING CYBER RISK open when it comes to attracting “If I’d just been a director and wasn’t still Greater connectivity means digital skills to the boardroom. busy in the digital world, I think I would’ve that no business is immune to gotten stale quite quickly,” says Geraldine. “When you think about people who have cyber risk. This is a governance this kind of experience, they may not have issue just like any other risk to “I’m in the middle of all of those trends chosen to have followed a governance path an organisation. To find out how and also experimenting within them and and they may be a little bit younger and to identify, assess and manage working with major enterprises across may not have led a company,” Victoria says. cyber risk, see the IoD Governance many different industries. That gives me Leadership Centre’s recently a very useful perspective to be able to “I think boards really need to think published Cyber-Risk Practice Guide. bring to board roles that I’m on now.” a little differently about how they bring that digital experience in.” For more information or to download As a director on the boards of SKY TV, the guide, visit iod.org.nz National Australia Bank, Fisher & Paykel She says companies looking for digital

Healthcare and MyWave, Geraldine skills for their boardroom could go digging focuses on making sure the businesses for talent in the thriving entrepreneur are part of this digital revolution. tech centres, as well as looking overseas. BOARDROOM | 21

Governance Leadership Centre update Felicity Caird discusses two emerging issues that have been a recent focus for the GLC. Corporate tax governance An increasingly borderless digital The plan, endorsed by G20 finance to improving tax behaviour over more economy is changing the way we do ministers in July 2013, sets out 15 areas of regulation. Its International Revenue business, and the international tax work across a range of tax issues, including Strategy Manager, John Nash, says that environment is changing accordingly. the digital economy, transfer pricing, the vast majority of corporates do the right Governments across the globe are facing and coherence of corporate income thing and comply with New Zealand’s tax pressure to find more tax revenue in taxation, as well as the transparency, laws. But he says this is not always visible, the wake of the global financial crisis, certainty and predictability of taxation. which can reinforce negative perceptions and multinational companies like about whether major companies are paying The Business and Industry Advisory Google, Apple and Starbucks have been their fair share. He suggests adoption of Committee (BIAC) to the OECD issued lambasted for not paying their fair share. the BIAC principles and greater public a Statement of Tax Principles for disclosure would increase transparency In a globally-connected world, directors International Business in September 2013 and lead to a better understanding of should expect global information-sharing that provides voluntary guidance for company tax policies and tax governance and greater tax scrutiny. Risk to reputation businesses to promote good tax behaviour. is higher than ever before and boards must by shareholders and the general public. In the UK, the Chancellor of the be across tax issues and clear about their The Governance Leadership Centre’s Exchequer announced in the Summer role in, and approach to, tax governance. July directorsbrief, which focuses Budget that the UK Government would The OECD has developed the Action Plan on on emerging issues for audit introduce a voluntary code of practice Base Erosion and Profit Shifting (BEPS) to committees, covers this and other on standards of behaviour to help ‘tackle reform the system. BEPS is the term used issues in more detail, and is available evasion, avoidance and aggressive to describe tax planning strategies that for members at www.iod.org.nz. tax planning by large businesses’. take advantage of gaps and mismatches in tax rules, for example, by diverting income Closer to home, Inland Revenue says it to countries with low corporate tax rates. would prefer a business-led approach New governance arrangements for Māori land owners The Government’s reform of Te Ture sector in which practices occur, the Affairs has asked for feedback on the Whenua Māori Act involves significant ultimate purpose of governance is the draft bill. The IoD’s submission focuses reform of Māori land law and will same – to create and add value. specifically on the powers, duties and result in greater tino rangatiratanga responsibilities of kaitiaki and suggests The need for robust, transparent and for Māori over their land. further clarity on duties and liabilities accountable governance of Māori land was is needed – for example, in relation With respect to good governance, the a common theme of the submissions that to kaitiaki of different types of bodies, ultimate aim of Te Ture Whenua Māori led to the drafting of the bill, alongside e.g. trusts or body corporates. Bill is to produce capable governors the need for the duties and obligations and stewards with an appropriate level of trustees and other governance bodies There will be further opportunities to of oversight. The bill introduces new to align with the laws that apply to submit on Te Ture Whenua Māori reform governance arrangements and aims to general land and corporate bodies. when the bill is introduced into Parliament. clarify the duties and responsibilities The introduction of new governance Background information of kaitiaki (guardians or governors). arrangements, and the role of kaitiaki, and the IoD’s submission are While the form and substance of are important developments in the available at www.iod.org.nz. governance may differ because good governance and stewardship of the business structure or the of Māori land. The Minister of Māori

BOARDROOM | 23

Playing the game Sport and business – they have been close partners since professionalism took hold in elite sport. Are they a perfect match or are there still some issues to smooth out? By Katherine Robinson

As the New Zealand Rugby Union (NZRU) chair who co-led our country’s bid to “I believe that we should host the 2011 Rugby World Cup, the late have as strong as Jock Hobbs had a compelling way of ensuring that the board stayed on task. possible a contest on the

“Jock insisted that the board spent grass, but when you get lot of time going through the NZRU on the concrete it should Charter – which was based on the IoD Charter,” says Chris Moller, NZRU be about cooperation chief executive from 2003 to 2007. across the sport in the ‘He required every director on the board long-term best interests to sign it. It would sit in the middle of the board table each meeting. When of the game as a whole.” necessary Jock would point to it when he felt that self-interest was getting in the way of the game’s best interests. audiences – the 2011 Rugby World Cup “It was the symbolism of signing the charter drew an estimated audience of 3.9 billion that made it work. All listed companies over the course of the tournament. have charters but I have never ever seen It’s a potent combination reflected in them used in this way. Normally, it’s not the top dollar paid in broadcasting necessary. In business, it’s understood that rights, sponsorships and advertising for the board must act in the best interests of our most popular sports. The revenue the company – in sport this can be blurred.” in turn allows sporting associations to In part, this stems from sport’s passionate pay players and reward top performers, tribalism – perhaps ironically one just as any business would reward its of the qualities that makes sport so employees. In the recent Cricket World attractive to business. Sport engages Cup, for instance, teams played for their emotions and generates deeply felt cut of a $13.58 million pot. The Australian allegiances to teams. Big gladiatorial winners took home $400,000 each; contests such as the upcoming Rugby as runners up the BLACKCAPS earned World Cup attract massive global $200,000 from the tournament. 24 | BOARDROOM

WHAT CAN SPORT TEACH BUSINESS? PROFESSIONALISM AT THE TOP If business brings revenue, to be better entrepreneurs, better Elite sport is not just business – but big business. businesslike structure and athletes and better people.” There’s professionalism on the field and a objectivity to sport, what can complex commercial operation to manage in the Ex-Black Cap and business leader sport bring to business? back office, but do sporting associations reflect Martin Snedden says teamwork is the this with professionalism in their governance? Plenty, says psychologist obvious quality that sport brings to Not as much as they could, according to Chris. Sara Chatwin, who teaches the business world. As CEO of Rugby “Just speaking generally, the challenge is that winning strategies to both New Zealand 2011 Ltd, a key part of the governance model in sport still tends to sportspeople and businesses. his role was to persuade disparate be based on a representation model which people and organisations to work “One of the key points about sport doesn’t make it particularly easy to always act together as one team to deliver a is that you have to be proactive in the way a business might operate,” he says. successful event. Subsequently, as and organised. You have to work CEO of Tourism New Zealand, he “I believe that we should have as strong as out what your goal is, how you tried something similar with the possible a contest on the grass, but when are going to achieve that goal and country’s multiple tourism interests. you get on the concrete it should be about you have to work hard to achieve cooperation across the board in the long- it. Organisation is such a key “It takes a lot of emotional effort to term best interests of the game as a whole.” element to success – this is equally get people through the enormous applicable in business,” she says. barriers that exist by default and It’s not a problem confined to any particular get them to work together to create sport or to New Zealand, he says. And he She says that sport creates a drive something that works collectively. acknowledges that many codes, including to excel – the motivation is always With the Rugby World Cup, there cricket, rugby and swimming, have reviewed to win. “In business, the motivation was a central focus – the Cup was their governance structures and adopted a more may be to do well, but elite sports coming up whether we were ready businesslike governance model with at least two people want to be the best.” for it or not – whereas tourism is professional independent directors on the board. World champion squash player made up of multiple, competing “You need to have a mix of skills on a board and New Zealand Race Relations businesses and it is ongoing. It – people with a background in the sport and Commissioner Dame Susan Devoy became a case of offering strategic people with a commercial background as agrees: guidance rather than being pushed well. Sporting associations are also waking in a specific direction,” he says. “In sport, I tend to believe that if you up to the need for diversity in gender and put effort into the process and the He believes that sport’s winner ethnicity to reflect the grassroots of this detail, the outcome will inevitably takes all approach sharpens the country. The sporting bodies that acknowledge follow. A training programme is competitive edge in business. this will be amongst the most successful.” a bit like a business plan, but you “It’s that real competitive spirit. I He says that one of the challenges in sports have to also have self-belief and have had several career changes governance is to get high calibre people discipline. If you are constantly over the last decade or so but I can’t willing to apply for governance roles. worrying about what the outcome walk into anything and treat it like a is going to be, it is highly likely it “It’s hard to get the right people to put their day job. To me it becomes a mission will not go smoothly,” she says. hand up. Sports governance at the top level to succeed and that comes from can be very demanding in terms of being Dame Susan says that sportspeople my sporting experience,” he says. constantly under the media spotlight and might also have the edge in business “In sport, you know that only a small answerable to the whole country. Cricket as they are used to facing the percentage of elite sportspeople New Zealand, for instance, took more of possibility of very public failure. are going to succeed. You know my time than any large listed company.” “It does help when it comes to that you are on a hiding to nothing. making hard decisions,” she says. Currently chair of Meridian Energy, the New There is no such thing as instant Zealand Transport Agency and SKYCITY, Chris “Like business and sport, human success in this stuff. The real success recalls being recruited as CEO of the NZRU after rights is ultimately about people, is when you last the distance New Zealand lost the hosting rights for the what drives us and what inspires us and find success periodically.” 2007 Rugby World Cup to Australia in 2003. BOARDROOM | 25

Chris Moller Dame Susan Devoy Martin Snedden Dame Therese Walsh

“They said they had enough rugby people, rollercoaster attached to decision- what they wanted were more business making in sport, so being very aware “You know that you will people,” he said. of that emotion is very important. be judged on a very black “You know that you will be judged on a ON THE EMOTIONAL ROLLERCOASTER and white, finite result. If very black and white, finite result. If you One of those business people was Dame are on the board of a listed company and you are on the board of a Therese Walsh, recently honoured with the share price goes up or down that’s a a damehood for organising two of the listed company and the tangible result but there is some fluidity. biggest sporting events hosted by New If a team loses a match it can be pretty share price goes down... Zealand. As Chief Financial Officer and the much do or die at that moment,” she says. General Manager of Corporate Services there is some fluidity.” for the NZRU, she was a key part of the When it came to working towards the team in behind the 2011 Rugby World Cricket or Rugby World Cup, decisions “You learn to be very creative and very Cup. She went on to head the organising were made under the pressure of a determined about getting something to committee for the 2015 Cricket World looming deadline. A countdown clock the finish line. If you don’t have the whole Cup. Dame Therese is also a director on ticking the days down to zero was put country behind you, it’s never going to the boards of TVNZ, Westpac Stadium in a prominent place for all to see. work. And that’s quite a hard ask because and the NZX. Do boards of sporting “You don’t get another chance or your stakeholders are the whole country.” organisations have a distinct culture? another budget so it’s quite intense “There is much that is the same – monthly in pace. If you add the intensity of board papers and financials to review pace and emotions together, it’s – but there is more of an emotional quite an interesting place to be. CALLING

EMERGING Benefits of the award differ from branch to branch but may include a mix of complimentary IoD membership, DIRECTORS free attendance at selected events plus funding towards a Director Development course. Some branches offer mentoring or a chance to observe a board. Do you aspire to follow a directorship path or are at an early stage of a governance career? APPLICATION DATES Auckland, apply now, applications close 18 September Can you demonstrate a commitment to career Wellington, apply now, applications close 18 September development and a high level of integrity? Canterbury, apply now, applications close 28 August Are you committed to development of For more information, please visit the branch pages governance roles and abilities? of iod.org.nz or contact your branch manager. Surviving the perfect storm Five years ago, boardroom interviewed communications consultant and Ideas Shop Partner Anna Kominik on how to lead during a media crisis. To say much has changed since then is an understatement. Social media has swept through the communications landscape, reshaping the nature of media and a media crisis. By Katherine Robinson BOARDROOM | 27

“From a governance perspective, don’t put rose-coloured glasses on – you must be aware that things will happen. You need to work out the inherent risks to your organisation and plan for how you Surviving are going to manage those risks.”

“We are at the tipping point now Anna doesn’t believe that a low profile the where social media drives a lot of our guarantees immunity. Powerful search news – and how mainstream media engines, free cloud storage and data reacts to it. All media outlets routinely analytics make information readily monitor social media as part of their available on virtually everyone. perfect newsgathering process,” says Anna. As reputations become more fragile, As we’ve seen recently, a story that might so they become more precious. have once been of minor, local interest, US authors Michael Fertik and David such as a classroom speech by a Napier C Thompson argue in the bestselling storm schoolgirl lambasting her teachers, can book The Reputation Economy that Five years ago, board interviewed communications blow up into a global news story once it’s reputation is an organisation’s or an room individual’s most valuable asset. consultant and Ideas Shop Partner Anna Kominik on how posted, shared and reshared on Facebook. “Reputation is currency. It’s as And it happens at speed. In the pre-digital valuable as your corporate balance to lead during a media crisis. To say much has changed era, crises would break in what now seems sheet or the cash in your wallet,” they since then is an understatement. Social media has swept a quaint, orderly fashion through radio or say, arguing that online reputation television news bulletins or in the morning through the communications landscape, reshaping the should be nurtured and protected. paper. This allowed hours or even days nature of media and a media crisis. By Katherine Robinson for organisations to prepare a considered “I think the impact of a social media response. Now response times are down crisis on brand and reputation is there to a matter of minutes, says Anna. for everyone at all times – no matter how big or small your organisation. Media storms can wreak enormous Even a small business can be just damage in business disruption and brand one event away from an event that reputation. According to Anna, a recent damages reputation and the ability to US study showed that even a minor social deliver a quality product,” she says. media blip might last about 20 minutes One thing that has stayed rock but could cost a company US$53,000, solid is the preparation required and that cost will mount exponentially for handling a crisis well. for every 20 minutes afterwards. “So you can imagine the impact of a major crisis “In any crisis, it has been an enduring that lasts days or a week,” she says. principle that it is not the crisis but

ringo / photocase.com 28 | BOARDROOM Health & Safety Reform Are you managing the handling of the aftermath that can make or break a your Drug & Alcohol risks? reputation. Good crisis management is not about winning, it is about damage control. There is no victory in an attacking approach,” says Anna.

Preparation can come down to simply being present online, monitoring websites and promptly responding to commentary, whether it is online or in the media.

“There is no way that you are going to be able to control social media but you may need to be part of the conversation. Organisations around the world have got into huge problems by ignoring a negative comment. Organisations need to be able to respond, even when it is uncomfortable. If you don’t, you could get punished for it. Customers and clients can use the online world to become ‘avenging angels’ very quickly if companies don’t show that they are listening fast enough or in a genuine way,” says Anna.

The Health and Safety Reform Bill is “Some companies do this extremely well. They are not afraid scheduled to take effect this year. to listen to what is being said and to answer honestly. They Directors and those in governance may say this is our point of view and these are our constraints roles will have a due diligence duty to – but they are part of the conversation,” says Anna. proactively manage Health & Safety. One of the main risks stems from both the transparency Drugs and alcohol will be specifically stated as a and opacity of the online world. Businesses and hazard within the new Act. organisations are out in the open but online commentators often hide behind anonymity. The Drug Detection Agency (TDDA) is Australasia’s complete solution provider for all workplace drug “On the positive side, the online world rewards those policy, education and testing needs. Our end- companies that are open and genuine about how they are to-end services provide you with a high level of comfort in relation to achieving a safer workplace. doing business. Social media means an organisation can no longer hide the ugly bits or make claims for something unless • National coverage with 18 offices and it is true. The anonymity of the online world makes it very easy over 40 purpose-built vehicles offering mobile testing. to expose companies that are not behaving well,” says Anna.

• Fully compliant to AS/NZS 4308:2008 A company might promote itself as being sustainable, – IANZ accredited for on-site urine for instance, then be found to be involved in polluting a screenings. waterway or the atmosphere. A business which presents • Trusted provider to many blue-chip itself as having strong corporate social responsibility will New Zealand companies. be punished online if it’s found to have its products made Let us work with you to achieve a safer workplace. by factories in Third World countries with bad conditions. This watchdog role was played by the media in the Visit www.tdda.com/iod past, but social media means the spotlight falls on to download a resource for Directors, any credibility gap more harshly and with speed. about Drugs in the Workplace. Anna believes that the board needs to play an active role in media crisis management, both in setting an overseeing strategy and in playing their part in managing a major crisis.

“From a governance perspective, don’t put rose-coloured glasses on - you must be aware that things will happen. You need to plan for the inherent risks to your organisation and how to manage those risks. There should be a crisis plan and a checklist that can be pulled off the shelf at a 0508 drugtest www.tdda.com moment’s notice. The boards that do best in a crisis are © 2015 The Drug Detection Agency, New Zealand. All Rights Reserved. Zealand. New Drug Detection Agency, © 2015 The BOARDROOM | 29

How would you lead during a media crisis? those who have pre-planned for the different scenarios Find out by attending Managing in a Media Crisis, a day-long that could happen and are prepared,” says Anna. workshop that launched last month.

“In a major crisis, directors often can’t just be in Part of the Boards in Action series, the course has been governance mode. They will have to make fast, significant developed by the IoD and Ideas Shop, focusing on the decisions to protect the shareholders’ interests but leadership role played by directors in setting strategy and also work to their strengths. For example, there ensuring there is a cohesive crisis plan. Aimed at experienced might be someone on the board who has very good directors only, it includes dealing with the impact of social stakeholder management skills who is likely to come media and weighing up risks in a rapidly changing scenario. into play. Management are not going to be able to do Led by Ideas Shop partner and founder Anna Kominik, the everything, no matter how big an organisation is. course is taught in part through simulation activities. “It can be very scary for boards because what “Course participants will be feeling it in real time as they go seems a small incident can tip over into a crisis at through the process as it gives an idea of the speed with which such speed and a board doesn’t always have full a crisis can break. It is based on the real life crises that we information before they start engaging with social have worked with before and focuses on the need to sustain and mainstream media. You can’t hide and you have business continuity while protecting brand and reputation. to know how to engage and communicate safely. “I’ve found that participants themselves are willing to share “If you leave a void then others will fill it very quickly.” their own experiences of crises so directors and chairs have On the upside, the speed of information today also means been able to learn from their peer group,” she says. that people move on fast. Managing in a Media Crisis will be held on the following dates: “If an issue is handled quickly and well, then there is Christchurch, 3 November a degree of forgiveness. Some companies have even Auckland, 26 November managed to turn the tide of public opinion in their favour Wellington, 2 December thanks to their handling of a potentially damaging crisis.”

BoardroomTraining Made to measure The IoD offers contextual boardroom training, tailored for your board

Training that is customised to your requirements ensures it delivers specifically to your board needs, is environment centric, and industry relevant. Our expertise allows us to cover complex environments such as iwi-controlled entities, government, SME, not-for-profit, and private and listed organisations.

Call us to discuss on 04 499 0076 or email [email protected] iod.org.nz IOD14216 Digital identity and the cost of doing business In today’s online and interconnected Law changes on the horizon will affect world, it is essential that people feel all businesses that deal with personal assured that their digital identity information, especially those selling into and data is protected. Developing the EU or performing data processing and maintaining this confidence will outsourced from the EU. By Justin require sustained effort in a climate of Graham and Tim Sherman increasingly sophisticated risk. BOARDROOM | 31

Public faith in the integrity of New flow without impediment from the EU serious offending. This is much closer to Zealand’s privacy practices is not high. member states to New Zealand for the sanctions anticipated by the EU, which A survey this year by the Insurance processing). Once the new regulation is would punish a failure to report a data Council found only 29 per cent of in force, pressure will mount to update breach by a fine of up to €1 million or 2 New Zealanders were confident in the our own law to match. At this stage per cent of annual worldwide turnover, ability of New Zealand businesses it looks likely that existing adequacy whichever is the greater. and organisations to protect against designations will be preserved, at least computer hacking and keep data secure. for an initial period of five years, but we REFORM DIRECTIONS IN will now be vulnerable to withdrawal if THE EU REGULATION This is not surprising given the recent the European Commission decides we no A key change of particular relevance to run of high profile privacy breaches longer meet the relevant requirements. New Zealand is that the regulation will and the rickety nature of the regime apply to businesses located outside created by the New Zealand Privacy So as directors scan the horizon to the EU but supplying the EU market. Act. This dates back to 1993, which anticipate how the regulatory framework This covers not only businesses that makes it 22 years old in calendar years, around privacy will evolve in the short collect and use EU residents’ personal 154 in dog years and positively ancient to medium term, it might be useful to data, but also IT and other service in IT years, pre-dating the emergence think of the bill as round one and the EU providers who hold or process that data of social media and e-commerce. regulation as round two. We note that as contractors to those businesses. both are still works in progress and may The activism and energy of the Privacy be subject to change (the draft regulation The provision that initially excited most Commissioner’s Office have mitigated the has been described as one of the most media interest is the ‘right to be forgotten’, Act’s weaknesses to some extent. But lobbied pieces of legislation in EU history). which will allow data subjects to have data the reality is that it is not well-designed erased if historic or no longer relevant. for the age of bulk data, where a single REFORM DIRECTIONS IN THE But this once radical concept has since privacy breach can have thousands of NEW ZEALAND REFORM BILL been “normalised” through a decision victims and where the focus needs to be on The principal changes which were agreed by the European Court in Google Spain v early risk identification and management to by Cabinet last year are: Costeja González, which allowed a Spanish rather than on post-breach remedies – • mandatory reporting of privacy national to insist that Google remove a link although they will always be important. breaches – these would have to be to a criminal record dating back 16 years. These facts are well-acknowledged by notified to the Privacy Commissioner The regulation is long, immensely the Government and a reform bill is being and, where the effects are serious detailed and still to go through a developed but the process has been very and could cause real harm, loss tripartite negotiation between the slow. A Law Commission report containing or humiliation, also to the affected European Commission, the Council of 149 recommendations was tabled in 2011 individuals. Failure to notify a breach Ministers and the European Parliament and Cabinet signed off on a package of would be a criminal offence for private so we will await the final outcome changes in March 2014, yet here we are, in sector agencies. Cabinet’s thinking was before commenting in detail. the second half of 2015 and still waiting. that ‘naming and shaming’ would be a sufficient deterrent in the public sector At this stage, it is sufficient to note Minister of Justice Amy Adams, in a • stronger powers for the Commissioner that the proposed new administrative statement provided for this article, said to initiate investigations and proactively and compliance requirements are she has been taking time to consider intervene where concerns have been significant, such that the regulation whether there are any other issues raised about an entity’s privacy systems will allow for a two-year transition in the privacy area that should be and practices, including greater scope period and that European law firms are included and that work is “ongoing”. to make urgent information requests advising their clients that they should Ongoing it most definitely will be, because • a new power to issue compliance start putting their houses in order now. even as the Minister puts the finishing notices which would be enforceable by, Justin Graham is a partner at Chapman touches on New Zealand reforms, the and appealable to, the Human Rights Tripp specialising in technology, media European Union is raising the benchmark Review Tribunal, and and communications, privacy and in the new EU Data Protection Regulation, • increased maximum penalties for non- dispute resolution. Tim Sherman is which it expects to be adopted by the compliance from $2000 to $10,000. a senior associate specialising in end of this year or early next year. The Cabinet paper acknowledges that commercial law with an emphasis We are currently the only Asia Pacific the bill’s penalty provisions are at the on technology projects, outsourcing country to have EU Adequacy (meaning low end compared to other jurisdictions, and intellectual property. that we meet the EU’s data protection including Australia, which provides for standards and that personal data can fines of up to A$1.7 million for repeat and She might head up one of the world’s top companies, but when it comes to networking, Marissa Mayer doesn’t fare too well. How to The CEO of Yahoo! has reportedly confessed that not only does she have to force herself to attend networking events, she also makes herself stay at such events for a certain amount of time. She is not alone. In Britain, a recent survey showed that 62 per cent of network British adults have never attended a networking event. And when A vital social skill, networking can they did try to network, they reported not enjoying it – half of enhance both your professional and those surveyed (51 per cent) described feeling uncomfortable. But here’s the rub – ask any successful person and they’ll personal lives. Sharon Stephenson tell you that networking is a key element in moving one’s talks to some of life’s natural career forward. Your network is, after all, your net worth. networkers on the importance As Tauranga commercial lawyer and board director Kylie van Heerden puts it, the art of strategically developing of making connections relationships can do wonders for one’s career and business.

“Networking is vital to develop any professional career,” says Kylie. “Throughout New Zealand, and particularly in the regions, there’s a strong word-of-mouth culture, with sought-after governance roles often not advertised and candidates frequently identified through existing director networks. Networking is, therefore, of particular importance to those seeking governance roles to build and maintain a profile that ensures they feature on the radar of those looking for board candidates.”

Kylie, who at 33 years old is one of New Zealand’s youngest directors, believes networking packs a one-two punch: “When starting out and looking to build a profile, a big part of networking is about meeting people and simply getting known. However, when looking to secure opportunities, networking should be, and needs to be, more targeted.”

In addition to being a partner at Sharp Tudhope Lawyers and a joint owner/director of Tauranga’s Peet Jewellers, Kylie recently completed a director placement with Comvita Ltd and has taken on directorships at Craigs Investment Partners Superannuation Management Ltd and Custodial Services Ltd. She’s a strong believer in having a professional development plan that allows people to network in a targeted way that uses time efficiently and effectively.

“A plan allows you to identify your objectives, which networking opportunities are best suited to achieving those objectives, and how those opportunities should be approached – for example, identifying the key people to engage with at a particular event.”

Professional speaker, author and trainer Linda Coles agrees – but she’s also keen to correct the misconception that networking is only about attending professional events.

“Networking is about growing your business relationships and is something you should be doing all the time, not just at specific events,” says Linda. “As the saying goes, people only buy from people they know, like and trust, so you need to be constantly networking to build that trust.” BOARDROOM | 33

And while face-to-face interaction is make the most of every opportunity networking’s holy grail, Linda says social to network, no matter how small. I’ve “It’s amazing how media has a key role to play in 21st century networked in the most surprising interconnected we are, networking. “Tools such as LinkedIn circumstances, such as walking around so act with integrity, and Twitter can be used to make people my neighbourhood, so get out from behind aware of who you are and what you do. By that screen and make those connections!” be generous and sending a LinkedIn invitation or message There’s not much you can teach Dianne to someone who, for example, might be in continuously develop McAteer about networking. The former a field you want to get into, you’re saying your skills, knowledge netballer/coach/umpire, currently a ‘Hello, I exist’. It’s the same with Twitter.” director of Kitchen Studios, has spent a and experience.” However, a big no-no of online networking lifetime honing her networking skills. is spamming potential contacts. “If, of how can I help this person, how could Networking, she believes, is “important for example, you meet someone at someone I know benefit from meeting for any person with a desire to an event and then want to follow up this person, and how might I benefit continually learn and develop their with a message via LinkedIn, keep it from this person’s knowledge and short, mention who you might know in knowledge and skill base”. experience – what can I learn? It’s about common and find some common ground. “Yes, it is helpful to have a wide having a mindset of mutual benefit or But don’t start spamming them.” base of contacts if you’re looking for at least a ‘pay-it-forward’ attitude.” For Jackie Lloyd, a director of the opportunities as a director but, more Her overarching tip, though: “New Wellington Museums Trust, the Wellington importantly, networking is an opportunity Zealand is a small place and it’s Regional Strategy Committee, the State to share stories and learnings – to amazing how interconnected we are, Services Commission Audit and Risk receive and provide support to peers so act with integrity, be generous Committee and the Lion Foundation, and to benefit from the wisdom of and continuously develop your skills, networking in a governance context those who have gone before.” knowledge and experience.” is all about making connections. “I network with peers at the same point Words to live by. “Being a director can be quite lonely in their governance career in order to – you’re only meeting other board learn from their experiences, I use them members once a month or so and as a sounding board and hope that I’m NETWORKING TIPS you’re generally not sharing an office, reciprocating that support. I’ve also • Harness your natural abilities and so making connections with a wide been able to provide opportunities to strengths – if you are better at range of people at various levels is join boards to those keen to develop one-to-one conversations, tailor vitally important,” says Jackie. their governance career, or their your networking to suit your style. employment career, and I’ve had Networking should be natural. Having well-developed networking skills opportunities come my way because of • Establish realistic networking goals also crosses over to the governance arena, my networks – people who are prepared – commit to attending events or she adds. to recommend me or provide references.” emailing certain people each week. “It’s useful at board level to be able to A former managing director of Travelplan • Attend IoD branch events, get form relationships quite quickly, which involved and offer to help. Ltd (a subsidiary of House of Travel), is what networking teaches you. Good • Think about your own network, share Dianne says her belief in the power networking also requires you to be crisp contacts and introduce people to of networking was reinforced while and clear in your communications, which each other. doing her MBA thesis on the changes is an advantage in governance roles.” • When meeting someone for the first in gender diversity in NZX-listed time, make it all about them and ask Jackie recalls someone once telling companies. “It became very obvious open-ended questions. her that ‘If you think you’re networking, that ‘networkedness’ is important – • If you have made contact, follow you’re not’, meaning that if you try it’s who you know that can be very up with a brief email or make a too hard to network, it will often helpful. More often than not, governance connection on LinkedIn. come off as false and ineffective. roles are not advertised, so having people advocate for you is important.” For practical advice on how to “It’s about being an interesting person and network, visit iod.org.nz being interested in others. Really listen to Dianne suggests a focused approach what the other person is saying and treat to networking. “I try to approach each everyone with respect. And, of course, connection with a question in my mind

table / photocase.com PART 2 OF 3

Local solution to global food safety challenge Like the rest of the world, New Zealand businesses face significant challenges around sustainability, food safety, health and safety and marketing. In this second in a series of articles, KPMG partner Matt Prichard argues we should look to tikanga Ma -ori to find rich, unique, New Zealand solutions that can give us an advantage on a global stage. BOARDROOM | 35

The contribution of Māori business to New traceability, local food, recyclability MAURI ORA Zealand’s prosperity is one of the most and eco-packaging, eco-labelling, Māori believe that the land holds an exciting opportunities of our generation. environmental quality, carbon labelling essential life force – its mauri. That vital and reduction, organic, GM-free products, essence is transferred into the grass and If mainstream New Zealand business takes animal welfare, biodiversity and fair trade. other plants that grow on the land, and the time and builds relationships of trust, becomes part of the animals who consume KPMG believes there’s a huge amount to Their study showed that, for example, them. It connects us individually to the be gained for all New Zealanders from Chinese and Indian consumers were looking inside Te Ao Māori for solutions willing to pay more than a 70 per cent land, the environment and each other. to some of our biggest challenges. premium price for trusted food safety. The philosophy of Mauri Ora (the healthy This was far more important than other life essence) offers us a much deeper, EARNING MORE FROM THE intangible attributes in both our dairy richer approach to embedding food safety FOOD WE ALREADY EXPORT and meat exports to those consumers. into the culture of our food businesses. Much of our economic prosperity comes We know the global consumer is already from our ability to nourish the world with Culture is a much deeper driver of demanding the highest standards of high quality, trusted food. Our government behaviour than process. It drives our has set us all the challenge of doubling the food safety throughout the supply purpose and values, and motivates value of New Zealand’s exports by 2025. chain. We also know the risk we run if people to do things because they truly the consumer loses trust in our ability believe in the reason for doing them. That growth can come from: to control the safety of their food. • increasing global commodity prices The concept of Mauri Ora gives our food- • increasing production volumes A MAINSTREAM RESPONSE producing companies the opportunity • owning more of the global value chain Our mainstream response is rules- to teach their people that their roles and capturing more of the price the end based. Everyone wants to deliver safe are about preserving the mauri that consumer already pays for our stuff. food, but regulation and inspections lives within our food products, so Both recent experience and analysis are the necessary regulatory response that it is alive and well when it is of very long-term time series data to the risk to our collective reputation consumed by an infant or a pensioner indicates we’d be nuts to bet the farm on from a failure by an individual business. in Beijing, Mumbai or London. sustained growth in commodity prices. The average lamb is processed into It is a simple belief that captures all KPMG does believe that there is around 70 parts, and exported all over New Zealanders’ connection to the substantial opportunity over the next the world. Dairy processing was once land, and their good understanding decade for growth in food export described to me (by a plant manager) as of the direct link between the health volumes from irrigation infrastructure similar to oil refining – the natural stuff of the land and waterways and the and smart science being applied to from the cow is methodically broken healthy food we produce from them. both growing and processing. down into its components to be made Consider the stark contrast between into everything from cheese to plastic. But by far the biggest opportunity we see the plant manager comparing his is from New Zealand businesses controlling Thousands of pages of New Zealand handling of food to oil refining, more of the food value chain and capturing legislation and regulation govern and the concept of caring for and more of the total price the world’s people aspects of the supply chain between preserving an essential life force. are prepared to pay for our food. the grower and the eventual consumer of our food. Layer on that, many This layer of culture doesn’t mean we So what will they pay for? more thousands of pages of Overseas could retire the rules or the inspectors. Market Access Requirements But giving people a passionate belief that FOOD SAFETY PAYS applied by destination countries. supports their roles will always beat a Lincoln University’s Agribusiness and pure process and controls approach. Economics Research Unit published Enforcing the rules requires a small army a report on consumer behaviour and of inspectors and testing agencies in our Embedding this basic Māori philosophy trends for “credence attributes” last businesses, and at the borders and the in our food exporting businesses year that focused on New Zealand’s key markets in the countries we export to. can be the basis for a unique markets, and the willingness of those advantage on the world stage. All of this process and control is needed customers to pay for product features to protect our industry. But all of it Matt Prichard is a partner at KPMG. This that are not physically observable or is only as strong as the people who is the second in a series of articles that experienced at the point of consumption. operate it. So our food businesses face explores opportunities to apply tikanga Examples of credence attributes include the challenge of building food safety Māori to give New Zealand businesses food safety, country of origin labelling, deeply into the culture of their teams. an advantage on the global stage.

Illustration Lee Watt 36 | BOARDROOM potentialLiving up to Five years ago, Lindy Nelson launched the Agri-Women’s Development Trust (AWDT) with the aim of realising what she saw as the untapped potential of women in the agricultural sector. Now, she can count over 1,200 alumni, many of them working in multiple roles throughout the sector

“New Zealand agriculture is made stronger “We are finding that our graduates are and more secure if every person within taking on multiple roles. They may be the sector is able to reach their potential. contributing to the management of the farm Women make up 50 per cent of the but they might also be on an agri-business population but agri-women have to deal corporate or leading in the community with a particular set of circumstances that or on environmental issues,” says Lindy. can block their development,” says Lindy Governance and leadership are part of Nelson, founder and chief executive of the the nature of the agricultural sector, she Agri-Women’s Development Trust (AWDT). says. The family farm might be a multi- Isolation, limited access to professional million dollar concern, spread over many Lindy Nelson development, cost of training, the right hectares or split into different locations. As equal partners, women will often business skills and a lack of awareness of women working in all areas of the take a leadership role in its operation. existing skills can seem unassailable barriers. agri-sector, including agribusiness. But Lindy says “phenomenal women” Lindy, who with her husband David, owns “When women first meet on the programme bring something extra to the agri-sector. a hill country farm in the Tararua District, they may look at each other and think ‘well, saw the solution in setting up a range of “Agri-women tend to be very comfortable how do I fit here?’” But they all do because programmes aimed at not only upskilling leading in quite murky situations where we have chosen women with a specific women but encouraging self-belief. there might be unclear structures quality rather than a particular skillset. AWDT’s portfolio of five programmes and timeframes. Often, women will You can always teach skills,” says Lindy. ranges from courses on farming business be the ones looking at planning ahead Praised for her “determination, passion management to the Escalator programme, across generations and dealing with and clever commercial thinking” Lindy an ambitious 10-month course that intergenerational succession issues on a won Next magazine’s award for Woman trains women in the hard and soft farm. If you look at the regional level of of the Year 2012 in the business category. skills of leadership and governance. governance, you will often find women dealing with multiple stakeholders where She not only researched the content of The IoD provides the fundamentals a collaborative approach is needed.” the programmes, but enlisted support of boardroom training for Escalator from the industry and won the backing One of the most important learnings with three day-long courses: of strategic partners such as ANZ, Beef for women on the Escalator programme Governance Essentials, Finance + Lamb New Zealand, the Agricultural is that the skills they have picked Essentials and Strategy Essentials. Marketing Research and Development up in the course of running a farm Trust (AGMARDT), DairyNZ and FMG. “I was keen to have the IoD involved in or agribusiness are transferable to Their support has allowed her to keep boardroom training for the course right other businesses and organisations. from the start. It’s proved to be a valuable the costs to course participants down. “It’s about overcoming a lack of confidence. part of the programme,” she says. She also has high praise for the This is huge, an epidemic among women, Limited to a fiercely contested 14 programme’s male champions who even the most talented women – and not places every year, Escalator now has have acted as mentors or supporters. just in the agricultural sector,” says Lindy. 51 graduates, many of whom are in “They understand that it is a 50/50 leadership roles in different sectors She emphasises that the programme partnership. We have a leaky pipeline of business and the community. is not only aimed at farmers but at of talent here, not a glass ceiling.” BOARDROOM | 37

“You don’t realise that those skills that you learn on the school board or managing “I loved the governance the farm can be transferable. I think component. It not only we just forget that. It takes a course or cemented and extended someone saying to you ‘look, you can do this’ to make you realise that you can. my existing skills but The programme gave me the belief that at the end of those I can achieve at a higher level. I think others saw my potential, but I couldn’t.” three days I knew that I Dawn Sangster A straight-talking country woman, she wanted to be a director.” A catalyst for change is how Dawn admits that she was initially surprised Sangster describes the Agri-Women’s by the focus on self-awareness. Governance roles have included a Development Trust’s Escalator “I thought I was just going to be directorship on the board of Alliance programme. Currently a director taught hard facts but successful Group, and membership of the Beef + on the Alliance Group board, Dawn leaders need both the hard and the Lamb Farmer Council and Mohair New was one of the first women to soft skills to add value and make a Zealand. undertake the programme in 2011. difference to their organisations. She also became Otago Southland’s Dawn had spent 25 years raising “Part of the programme is about setting Aspiring Director Award winner in 2012. three children and managing goals and working out how you are going the family’s 2540-hectare Otago to do them. If you achieve them, it gives “That was a big thing for me – to be grilled sheep and beef properties with her you confidence. It teaches you that by four experienced directors for an hour – husband, sister and brother-in-law. success is not about luck, it is about and then be told that I had won,” she says. She was also deeply involved in her hard work and planning,” she says. community with interests ranging from Dawn found her particular niche in Industry pressures, board dynamics being a trustee on the school board to and sector-specific risks intersect the three days devoted to teaching helping to run cultural and sporting to create a unique operating fundamental governance skills events. On reading about the launch of environment for every board. Our through the IoD’s Essentials courses. Escalator in Farmers Weekly, her husband team are experts at delivering tailored told her, “you should apply for that”. “I loved the governance component. governance training that enables It not only cemented and extended you to navigate those challenges Dawn holds an agricultural commerce my existing skills but at the end and maximise your performance. degree, and her CV includes a spell as of those three days I knew that I an assistant accountant in London and For more information, contact wanted to be a director,” she says. a farm advisor role for MAF. But she our Boardroom Training team on says years out of the corporate world From that moment, Dawn’s career 04 499 0076 or see iod.org.nz. left her hesitant about returning to it. was on a fast track to the boardroom. 38 | BOARDROOM Making a smart move Emma Thompson’s role as managing director of Nelson- based public relations agency Etc Communications often led her into boardroom meetings with client boards and CEOs. She did the Company Directors’ Course (CDC) early in 2014 to better understand their needs – and found that her own governance career took off.

with the media, things can change at the last “A past client bumped into my husband “I was a board member minute. But I found there was enough time when I was away. When he heard when I did the course, in the evening or in breaks during the day that I was doing the CDC, he rang me and had sat around to touch base with the office,” says Emma. almost immediately to say that his board was looking for a trustee and we Early booking also meant that she was should discuss it when I returned.” many board tables, but able to put in the course preparation doing the CDC gave ahead of time. Offers of two other board positions me a whole other layer Emma often deals with other directors and followed, including a position on the CEOs; she says that having been on the board of Alzheimers New Zealand. Emma of understanding and course has helped her better understand applied for the role after seeing it confidence. It provided her clients. advertised in the IoD’s Director Vacancies and having met a current member of the foundation from “It provided insights into boards that the Alzheimers New Zealand board. I hadn’t experienced before, and which I could apply for reaffirmed learnings I had already taken She says she was particularly pleased other board work” on board. Having done the course also to be appointed to a national board role gives you a dose of credibility. Clients with Alzheimers New Zealand, which A five-day residential course is a serious are engaging me for my public relations she says has a critical social purpose. time commitment for the owner of any expertise but they also recognise the “We are strategically positioning SME but Emma found that the key was link with the IoD. It provides for a deeper ourselves for the growth in dementia to plan ahead. relationship to have this common ground diagnoses in coming years, and and common thinking,” she says. “I booked the course eight months in advance. implementing our mixed revenue At the time, I wanted to go right away but it A regular at the IoD’s branch events model to manage this growth – a mix was good to have enough time to allow me in Nelson, Emma was offered a of corporate sponsorship, bequests, to work around it. Even so, because I work directorship while she was on the CDC. donors, grants and Ministry contracts.” BOARDROOM | 39

The core of the IoD’s boardroom training, It was clear that you need both on a board, Company the CDC covers the fundamentals of as well as the other matrix of skills.” Directors’ Course governance in a supportive atmosphere After such a positive experience, is Emma The heart of the IoD’s professional fostered by the Chatham House Rule. The planning to do more IoD courses in future? development programme, the five-day facilitators are all experienced directors CDC is facilitated by experienced, who actively encourage discussion, debate “I’m really enjoying the board work I am current directors. and the sharing of experiences. Course doing at the moment but yes, I am looking participants get the feel of being on a real to do more, including the IoD’s not-for- Designed for directors with one to board through simulations – something profit course.” five years’ governance experience, that Emma was initially dubious about. it gives in-depth coverage of: TOP TIPS • governance best practice “I have never really liked taking part in Emma has these tips for anyone looking • strategy scenarios or role play, but you have to to get the most out of the CDC: • finance for the board put aside any misgivings you have as • do the preparation work before the • risk it is an incredibly valuable process. course to free up your evenings for • the law and directors Participants were divided up into teams networking and socialising, and any • board dynamics and culture or boards. work you might have to do back home Company Directors’ Courses 2015 • don’t be fearful of asking what you “None of our ‘board’ members knew each Auckland: 21 – 25 September*, might think is a stupid question – other before the CDC, so it was interesting 22 – 27 November often you will be surprised at how having to quickly work out who should be Wellington: 8 – 13 November many people want to ask the same chair and deputy chair, and decide how Christchurch: 12 – 16 October* question we would best work as a team,” she says. Hamilton: 19 – 23 October* • try as hard as possible to clear the Dunedin: 16 – 20 November* “It also became very clear to me that decks at work so you can focus on Queenstown: 6 – 11 September diversity on a board is not just about the course (Fully booked, waiting list operating) diversity of skills but also about diversity • if you don’t like simulations, put that 1 – 6 November (Fully booked, of personality. How we operated as aside and join in. Putting what you waiting list operating) teams throughout the week was starkly have heard from the speakers into 29 November – 4 December different. There were teams that were practice is how you learn. mainly doers and those that were thinkers. *These courses are non-residential.

Rise to your potential. Company Directors’ Course.

Call us to discuss on 04 499 0076 Step up or email [email protected] with the IoD iod.org.nz 40 | BOARDROOM

HEALTH & SAFETY

Health and safety reforms – the key changes The Health and Safety Reform Bill represents the most significant reform of New Zealand’s health and safety law in the past 20 years, bringing with it a number of key changes for businesses operating in New Zealand. Mark Goodey, Principal at Marsh, gives a breakdown of the expected changes

There are a number of changes to the WHAT IS ‘REASONABLY PRACTICABLE’ take reasonable care with their own definition of key duties and obligations in WITHIN A BUSINESS? health and safety and that of others. the Health and Safety Reform Bill, which The term ‘reasonably practicable’ implies forms the basis of the Health and Safety at what is or was reasonably able to be DEFINITION OF WORKERS Work Act. These key definitions include: done at a particular time to ensure the A broader definition of the term ‘worker’ • duties of a person conducting a health and safety of employees, taking has been introduced. A worker is seen business or undertaking into account and weighing up all relevant as a person who carries out work in • what is ‘reasonably practicable’ within matters. This considers the likelihood of any capacity for a PCBU. A worker a business the hazard or risk occurring, the degree includes employees, contractors, • duties of officers and who is defined as of harm that might result from the risk subcontractors, employees of an officer within a business or hazard, the knowledge or reasonably contractors or labour hire companies, • who is defined as a worker within a expected knowledge of the risk or hazard, outworkers, students, volunteers and business and how to eliminate or minimise the risk. people gaining work experience.

This broadened definition has significant DUTIES OF A PERSON CONDUCTING DUTIES OF OFFICERS AND WHO implications on how a PCBU must A BUSINESS OR UNDERTAKING IS DEFINED AS AN OFFICER manage the health and safety of all The primary duty holder under the WITHIN A BUSINESS persons engaged to perform work Health and Safety Reform Bill is a Person In the current version of the Bill, the under the PCBU’s control, including Conducting a Business or Undertaking definition of an officer includes any person contractors and labour hire employees. (PCBU). A PCBU is an employer, a corporation, who makes decisions that affect the whole association, partnership, sole trader or in or a substantial part of the business (for IMPLICATIONS FOR BUSINESS some cases, a volunteer organisation. example, the chief executive or company The Bill introduces harsher offences and director). This definition is intentionally PCBUs are in the best position to control penalties for breaches of the law than narrower than the one used in Australia, risks to health and safety at work as they those currently in place, as well as a which includes persons who participate in are the ones carrying out the business range of new and existing enforcement decisions. The due diligence duty applies or undertaking. This is why the PCBU will tools and compliance mechanisms for to officers and senior managers who have the primary duty under the new law in the regulator, inspectors and the District exercise governance functions, as they are relation to the health and safety of workers Court. These include improvement the only ones who can reasonably carry and others affected by the work carried notices, prohibition notices, non- out due diligence as specified in the Bill. out by the PCBU. A PCBU must ensure the disturbance notices, infringement health and safety of workers and others All workers, including senior and notices and enforceable undertakings. so far as is reasonably practicable. mid-level managers, have a duty to BOARDROOM | 41

WHAT SHOULD NEW ZEALAND BUSINESSES BE DOING? All officers, that is, persons who make decisions that affect the whole or a substantial part of the business, must now exercise due diligence in ensuring that the PCBU complies with its duties and obligations under the proposed Bill. Therefore, people at the governance level of an organisation have a positive duty to actively engage in health and safety matters, reinforcing that health and safety is everyone’s responsibility.

Due diligence means taking reasonable steps to: a. Acquire and keep knowledge of work health and safety matters up-to-date. b. Gain an understanding of the nature of the organisation’s operations and the general hazards and risks associated with those operations. The Bill also provides specific powers to The table below provides a summary c. Ensure that the PCBU has available the District Court, including the ability to of the new offences and penalties for use, and uses, appropriate make several new kinds of court orders system as detailed in the proposed resources and processes to eliminate available and provisions for prosecuting Bill, for both companies and or minimise risks. individuals within businesses. individuals within a company. d. Ensure that the PCBU has appropriate processes for receiving information regarding incidents, hazards and risks and responding to that Nature of offences Duty holder Penalties information. Reckless conduct – person Individual, for instance, $300,000 and/or five e. Ensure that the PCBU has, and engages in conduct that a worker or a self- years’ imprisonment implements, processes for complying exposes a risk of death or employed PCBU) with any duty or obligation of the serious injury or illness without PCBU under the Bill. reasonable excuse (clause 42) Officer of a PCBU $600,000 and/or five f. Verify the provision and use of the years’ imprisonment resources and processes referred to in (c) to (e). Body corporate $3 million A business must be seen to be exercising their ‘due diligence’ or in Failure to comply with a health Individual $150,000 the process of doing so before the or safety duty – person fails commencement of the new reforms. to comply with a duty and the Officer of a PCBU $300,000 failure exposes an individual The first step a business can take to to a risk of death or serious Body corporate $1.5 million ensure compliance is to complete injury or illness (clause 43) a gap analysis of officers within the business who exercise due diligence. All effective safety management starts Failing to comply with a health Individual $50,000 from senior management commitment. and safety duty (clause 44) Officer of a PCBU $100,000 For more information about the workplace health and safety Body corporate $500,000 reforms and conducting a gap analysis, contact Mark Goodey at Marsh - [email protected]. 42 | BOARDROOM

events branch 2 IoD members are welcome to attend branch events nationwide. CPD POINTS Members will be awarded Check out the full list of branch events at iod.org.nz 2 CPD points per event.

AUCKLAND WAIKATO

FirstBreak evening panel Next Generation Director evening Cybersecurity - who’s accountable? Topic: The Executive Directors workshop Tom Walton of Network Box on 5:30pm - 7:30pm, 25 August, ASB, Topic: Building governance awareness why New Zealand organisations 12 Jellicoe Street, Auckland 4:30pm - 7:00pm, 13 October, need to take urgent action BNZ Partners Business Centre, and how effective internal Digital transformation: 80 Queen Street, Auckland accountabilities can be established. A beginner’s guide 4:00pm - 6:00pm, 2 September, 3months director Fraser Whineray, CEO, Waikato Stadium, Hamilton Mark Pascall on the Mighty River Power issues, challenges and Join us for a breakfast event with Moving Waikato 2020

opportunities that new Mark Pascall Fraser Whineray. Matthew Cooper on Waikato’s technologies bring. 7:30am - 9:00am, Friday 30 October, changing sporting landscape. 12:00pm - 2:00pm, 26 August, The Northern Club, 19 Princes Street, 12:00pm - 2:00pm, The Northern Club, 19 Princes Street, Auckland 16 September, Radio Sport Auckland Lounge, Waikato Stadium

New member lunch Breakfast with Shane Jones 12:00pm - 2:00pm, 7 October, Shane Jones, Ambassador for Pacific Economic Development, Gallagher Lounge, Waikato Stadium on opportunities and challenges for business in the Pacific. 7:30am - 9:00am, 16 September, The Northern Club, 19 Princes Street, Auckland Shane Jones WELLINGTON

East Coast breakfast BAY OF PLENTY with Nicky Hyslop Irrigation NZ’s CEO on the cornerstone of a prosperous regional New Zealand. Crown board appointments Employment 7:15am - 9:00am, 27 August, Brian McCulloch on the appointment legislation: what you Havelock North Club, Hawke’s Bay process. need to know 12:00pm - 2:00pm, 17 September, Sharp Tudhope partner Kerry Prendergast on Tauranga Club, Devonport Road, Shima Grice talks Shima Grice board diversity Tauranga legislation for employers. Wellington’s former mayor talks 5:30pm - 7:30pm, 28 October, conflict management and the skills Ethics – walking the line Whakatane (venue TBC) needed around the board table. Join us for an evening workshop on 5:30pm - 7:00pm, 1 September, developing an ethical culture with Strategy for a board agenda Institute of Directors, Bev Edlin. Maven International managing consultant 50 Customhouse Quay, Wellington 5:30pm - 7:30pm, 15 October, Joanna Lambert on prioritising and how to Tauranga Club, Devonport Road, get the most out of boardroom strategy Commerce Commission CEO Tauranga sessions. Brent Alderton and Chair Mark Berry 5:30pm - 7:30pm, 12 November, 7.15am - 9.00am, Tauranga Club, Devonport Road, 10 September, Wellington Club, Tauranga 88 The Terrace, Wellington BOARDROOM | 43

TARANAKI AUCKLAND Governing for success Shirley Hastings Transport industry leaders Graham Symons and Jim Ramsay on building governance ph: 021 324 340 best practice to allow professional management structures to grow and flourish. fax: 04 499 9488 7:30am - 9:30am, 25 August, Crowded House, 93-99 Devon Street East, New Plymouth email: auckland.branch@ iod.org.nz NELSON MARLBOROUGH BAY OF PLENTY Laura Gaveika Drugs and alcohol in the workplace ph: 027 5888 118 Steve Williams of The Drug Detection Agency on directors’ obligations under the incoming email: Health and Safety Reform Bill. [email protected] 5:30pm - 7:00pm, 13 October, Port Nelson, 10 Low Street, Nelson CANTERBURY Sharynn Johnson CANTERBURY ph: 03 355 6650 fax: 03 355 6850 A banker’s perspective Dame Jenny Shipley email: on rural governance The next 25 years – a forward canterbury.branch@ Join us for a cocktail function view on things that matter. iod.org.nz with ASB’s Richard Hegan. 5:45pm - 7:45pm, NELSON MARLBOROUGH 5:45pm - 7:45pm, 21 October, Addington Jane Peterson 26 August, The George, Events Centre, 75 Jack Dame Richard Hegan ph: 021 270 2200 50 Park Terrace, Christchurch Hinton Drive, Christchurch Jenny Shipley email: New member lunch Fellows and Distinguished Fellows Dinner [email protected] Network with other members and learn more By invitation only. OTAGO SOUTHLAND about the areas of the IoD that interest you. 7.30pm to 9.30pm, 21 October, Addington Vivienne Seaton 12:00pm - 2:00pm, 4 September, Events Centre, 75 Jack Hinton Drive, ph: 03 481 1308 The George, Park Terrace, Christchurch Christchurch fax: 04 499 9488 email: otago.branch@ Communication in a crisis iod.org.nz Tony McCormick and Nicky Hyslop share their experiences managing crisis communications, TARANAKI both from a board and management perspective. Cathy Thurston 5:30pm - 7:30pm, 7 September, ph: 027 2410 458 Tony McCormick Nicky Hyslop The Grosvenor, Cains Terrace, Timaru email: taranaki.branch@ iod.org.nz

OTAGO SOUTHLAND WAIKATO Megan Beveridge Fellows’ Dinner Christopher Luxon, CEO, Air New Zealand ph: 021 358 772 By invitation only. Join us for a luncheon with guest fax: 07 854 7429 6:30pm - 10:30pm, 25 September, speaker Christopher Luxon. email: Carrick Winery, Bannockburn 12:00pm - 2:00pm, 28 October, [email protected] The Dunedin Club, 33 Melville Street, Dunedin Queenstown cocktail function WELLINGTON Join us for a function with guest speaker Pauline Prince Mark Quickfall, Chair of Skyline Enterprises Ltd. ph: 021 545 013 5:30pm - 7:30pm, 23 October 2015, fax: 04 499 9488 Queenstown Resort College, email: 7 Coronation Drive, Queenstown wellington.branch@ iod.org.nz 44 | BOARDROOM

branchnews

AUCKLAND 1 2 KPMG’s Ross Buckley spoke on global megatrends and their expected impacts on New Zealand.

The Auckland branch heard from GCSB director Una Jagose on cyber defence.

3 4

5

WAIKATO 6 7 Minister of Finance Hon Bill English gave a post-Budget presentation to Waikato members.

The Waikato Branch congratulates James Yearsley, winner of the 2015 Waikato Emerging Director Award.

Earl Rattray interviewed Sir Henry van der Heyden about crisis management at a branch event in July. Sir Henry emphasized testing your crisis plan, stakeholder engagement, and recognising cross-cultural issues. 9

8

10 BOARDROOM | 45

1 | Warren Sowerby, Fay Sowerby (Auckland) 8 | Margaret Devlin, Hon Bill English, Brent Goldsack, 2 | Ross Buckley (Auckland) William Durning (Waikato) 3 | Mary-Lou Hoskins (Auckland) 9 | Jeanette Tyrrell, Anne Aitken (Waikato) 4 | David Henry, Catherine McLeod, Corrie Dark, Una 10 | Earl Rattray, Sir Henry van der Heyden (Waikato) 15 | Dougal McIntosh, Euan McIntosh (Nelson Marlborough) Jagose, Antony Byers (Auckland) 11 | Simon Arcus, Bryan Graham (Bay of Plenty) 16 | Tracy Taylor, Robbie Reynolds, Richard Borrell 5 | Dermot Ross, Rebecca Rose, Ian Gault, Mark 12 | Catherine Savage, Dr Helen Anderson (Wellington) (Nelson Marlborough) Lowndes (Auckland) 13 | Horiana Irwin-Easthope, Kathie Irwin (Wellington) 17 | Richard Thomas (Otago Southland) 6 | Hon Bill English (Waikato) 14 | Liz Hirst, Elizabeth Hopkins, Jane Cartwright, 18 | Jarod Chisholm, Matthew Holdridge 7 | Margaret Devlin, James Yearsley (Waikato) Robyn Dunlop, Jane Huria (Canterbury) (Otago Southland)

11 WELLINGTON Hon Sir Michael Cullen, Sir Maarten Wevers and Sir Neville Jordan presented on what governance really means in a government context.

An evening function saw members discussing directors’ responsibilities with regard to earthquake-prone buildings.

Auditor-General Lyn Provost spoke on the role of strong governance in improving the performance of, and the public’s trust in, the public sector.

BAY OF PLENTY 12 13 A Tauranga event with Sally Webb and Lesley Fraser saw members discussing how to encourage future focus, think outlandishly, value employees and live company values.

New Bay of Plenty members were welcomed at a dinner, with guest speakers Peter Tinholt and Kylie van Heerden.

The Bay of Plenty Branch congratulates Bryan Graham, winner of the 2015 Bay of Plenty Aspiring Director Award. 14 CANTERBURY Mark Pascall of 3months spoke on the IoD CEO Simon Arcus updated members challenges and opportunities that on key governance issues for 2015. technology presents. The Canterbury Branch congratulates Julie Hands, who was announced as winner of 15 the First Steps in Governance Award.

Dr John Penno, Managing Director and CEO of Synlait Milk, spoke on the importance of a company vision.

17 OTAGO SOUTHLAND 16 Rob Everett, Chief Executive of the Financial Markets Authority, presented ‘Directors’ duties: enduring principles, perennial questions’ at a Queenstown event.

A panel discussion on the governance dynamics of online businesses covered start-ups, the progression NELSON MARLBOROUGH to a full board, and the rapid pace of 18 Chris Garland presented ‘Rural governance change faced by online businesses. made easy’, advising members to keep The Emerging Director Award night governance simple and contribute to discipline drew crowds to events in Queenstown, and professionalism within the business. Invercargill and Dunedin, where Rachel A panel discussion on the challenges and Farrant spoke about her governance satisfaction of not-for-profit governance journey. The Otago Southland Branch with Paul Steere, Simon Danson and congratulates 2015 winner Richard Sarah-Jane Weir drew a record crowd. Thomas and runner-up Hetty van Hale. 46 | BOARDROOM

MEMBERSHIP FOCUS

Playing a strategic game The IoD draws its membership from all over the country and all stages of career. Every issue boardroom will focus on one director. In this issue: Otago Southland’s Tony Allison. By Breanna Cullen

Known to walk Dunedin’s George Street in He soon joined the board of subsidiary St a blue morphsuit as part of a promotion, Clair Beach Resort Ltd, as well as Southern Tony Allison is a director not averse to risk. Team Co, the not-for-profit overseeing the Southern Steel netball team. Having encountered some resistance to his proposal for staff to don the suits, Night ‘n Day Foodstores came knocking the Night ‘n Day Foodstores CEO decided in 2011, after a phase of growth so rapid to lead by example. that it catapulted the firm into the Deloitte Fast 50. Tony says a strategic “I think if you’re going to ask people to Tony Allison plan has been key to managing the do things, now and again you’ve got to firm’s growth as well as its risk. do it yourself.” “I think you’ve got to have a bigger picture The morphsuits have been semi-retired “I want to be as now but they are one of many strategic in mind – you’ve got to say, ‘Five/ten good as I can be, so moves from a man who says strategy is years out from now, what’s our business his game. going to look like?’ and come back and Chartered was a say, ‘OK, what do I need to do now to no-brainer for me.” “I love strategy. I like the fact that you make sure when I get there, I’ve adjusted can look at a big picture, connect all the along the way and I’m ready to move?’. dots, and then look for the opportunities “My mentor from the Aspiring Director within those.” Tony was named Otago Southland Award is the chair, so I talk to him Aspiring Director in 2012, and says about what I need to do, and then I Unsurprisingly, it was strategy that the mentoring that came with the win go to the meetings and contribute. sparked Tony’s interest in governance. was invaluable. With a bit of experience under his belt “I can be quite detailed, so it’s coming and looking to grow his skillset, he “I had made a start in governance back to the high level and making joined the Institute of Directors in 2010. and I knew what I liked, but I’ve got sure you’re concentrating on what’s a full-time job, I’m relatively young, coming forward and the risks that “Initially, it was just that improvement and there are a lot of people more we need to be addressing.” in myself and the board I was on. But experienced, so I wasn’t entirely sure Spare time is hard to come by, but Tony once you start lifting up a level, it really how to go further. The mentoring was gets engaging and I got a bit hooked.” manages to juggle his CEO role and the part I needed and benefited from.” directorships with time with family – He’s now a Chartered Member, having He’s on the boards of Dunedin City he has three young daughters. He’s made the transition last year. Council-controlled organisation City a regular fixture at branch events in “I want to be as good as I can be, so Forests, the Otago Southland Employers’ Dunedin, but also makes time for mountain Chartered was a no-brainer for me.” Association, and a small family business. biking, supporting the Highlanders, and a punishing gym schedule. Also a Chartered Accountant, Tony’s path He’s also on the Dunedin Airport board to the boardroom began at construction under the Future Directors programme and firm Calder Stewart, where a promotion to says it’s taught him how to communicate Chief Operating Officer saw him working effectively in the boardroom, and to with the board at an executive level. keep his eye on the bigger picture. Login and go to Continuing My dashboard to view your member details Professional and CPD Development (CPD) dashboard. All Members, Chartered Members and Chartered Fellows are required to complete CPD. The last of our members to be underway with CPD will begin in September. SO WHAT COUNTS FOR CPD? IoD professional development courses, branch events and other formal activity is automatically recorded on your online dashboard. For informal activities such as reading boardroom, and activities outlined in the table below, members will need to self-assess and record CPD.

POINTS ALLOCATION FOR INSTITUTE OF DIRECTORS ACTIVITY Formal activity Informal activity (Automatically recorded) Points (Self-assessed and self-recorded) Points Essentials series – Governance Essentials, Strategy Up to a max 8 Writing and delivery of a governance- Essentials, Finance Essentials, Not-for-Profit 10 each course related presentation Governance Essentials, Rural Governance Essentials each year Risk Essentials, Public Company Directorship 12 Up to a max Publication of a governance-related article 10

Governance Development Programme 14 each year Professional governance reading – Up to a max Online modules 5 journals, publications, online materials, 10

Company Directors’ Course boardroom magazine 40 each year Amortised over 2 years IoD development activity – Up to a max 16 e.g. Mentoring for Diversity 15 CDC Refresher 5 points per formal meeting with mentee each year Audit and Risk Committees, Leading in a Digital Era 8 Representation on IoD professional Up to a max committee 15 Boards in Action 5 5 points per meeting Per half-day session each year BetterBoards – formal board appraisal Chairing the Board 16 5 and self-review IoD Leadership Conference 5 12 Follow-up facilitated session for 1.5 days Chartered Member Assessment Directors’ Fees Survey participation 10 2 both parts Up to a max Branch events If participating in other governance-related 4 2-4 Notified when promoted surveys each year

PROFESSIONAL DEVELOPMENT WITH OTHER PROVIDERS WHAT IF I AM ALREADY COMPLETING CPD OR Professional development with other providers also TRAINING AS PART OF ANOTHER PROFESSION? counts, providing it relates to improving your governance From an IoD perspective, if the activity relates to performance. CPD activity undertaken with other providers improving your governance performance, it can attracts the same number of points as similar activities count towards your IoD CPD. offered by the IoD. Please refer to our guide to allocating points to third parties on our website: www.iod.org.nz/cpd Purpose-built for boards and leadership

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