Look and learn
How do young aspiring directors get a seat at the board table? It can be a challenge building the right experience and skills without being on an actual board. The board Observership Program offers real-world director experience on not-for-profit boards to aspiring directors aged between 25 and 40, giving them a chance to learn and see if they really do want that seat at the table.
Program founder and chair Jonathan Gavshon was an investment banker at JPMorgan in New York when he came across a program offering the chance to witness the workings of a not-for-profit board. “There weren’t many reasons I could justify to my boss as to why I should leave the trading floor on a regular basis,” he says. “But this one resonated with him because he saw it as a career development opportunity and a chance for me to see how decisions are made at a higher level.”
Gavshon got so much out of being an observer on the board of Jewish Education of Greater New York, including the satisfaction of contributing to the NFP sector in a meaningful way, that he set about replicating the program when he returned to Australia. The Observership Program began in Sydney in 2014, and in Melbourne in 2017. This year there will be 137 participants and expansion opportunities are being considered, says program CEO Cathy Robinson MAICD. The 12-month program aims to develop the next generation of leaders in the NFP sector by combining the practical experience of observing a board while learning about the theoretical side of a directorship.
“Being an observer means having a seat at every boardroom meeting, reviewing the board packs and having the ability to contribute to boardroom discussions where appropriate,” notes Gavshon.
“The only thing they don’t have is a constitutional right to vote,” he adds.
Observing boardroom processes, interpersonal dynamics and the nuances of decision-making helps build greater awareness and understanding of the practice of directorship. Brett Moore, chair of Victoria’s State Sport Centres Trust, which participates in the program, says that for his organisation, the value also lies in gaining access to a talent pool of future directors.
“I encourage them to not just be observers, but to offer their perspective,” says Moore. “They have carte blanche to participate in conversations.”
It also enables organisations to tap into a younger, more diverse cohort of talent. Participants come from a variety of professional backgrounds, and 65 per cent are female. The organisation also has partnerships with groups such as the Asian Leadership Program to broaden the pool of potential candidates. “Those who come into the organisation may not necessarily be steeped in the history of the industry we work within, but they come with great credentials,” says Moore. “They bring fresh insights we have found to be highly valuable.”
Gavshon agrees. “Our starting premise was boardrooms are predominantly pale, male and stale. The program brings diversity on multiple fronts.”
Along with taking part in board subcommittees, there is also the potential to get involved in strategic projects — something Philip Benedetti did in 2017 as an observer on the Melbourne Writers’ Festival (MWF) board.
“The chair at the time, Michael Webster, made it clear while recruiting me that he wanted someone who would contribute like a board member,” says Benedetti. “I attended every board meeting and was asked to share my opinions. The biggest contribution I made was running the two-day strategy offsite.”
Benedetti made flying trips from Sydney to attend board meetings in Melbourne and juggled the new commitments with his workload as a partner at Boston Consulting Group (BCG). “The additional element for this to be successful was that BCG fully supported me,” he says. “It is a serious time commitment and your company needs to be comfortable with that.”
At the end of the program, Benedetti was offered a position on MWF’s board, and BCG has participated in the program every year since.v
“You can theorise about what boards do, but until you’re actually in the meetings, you have no idea how the sausage gets made,” he says. “It was a wonderful, eye-opening experience.”
Board Level podcast series
The AICD has teamed up with the Commonwealth Bank’s Women in Focus to produce a podcast series featuring tips and stories from leading female directors. Board Level features interviews by journalist/author Catherine Fox with six Australian women making an impact in the boardroom.
Episodes feature directors talking about their transition to non-executive director roles, building their director brand, the recruitment process and what it means to be on a board. Interviewees include Sally Evans FAICD — on the boards of ASX 200 healthcare provider Healius, New Zealand retirement village operator Oceania Healthcare and chair of social enterprise LifeCircle Australia; and Jackie McArthur MAICD — a director of poultry producer Ingham’s, seafood producer Tassal and funeral services provider Invocare.
Check out the podcast here.
Of more than 530 former observers, 25 per cent have gone on to join the board. A few decide that being on a board is not for them.
Among those who’ve participated in the program and subsequently joined the boards of the organisations are Nina Kilpinen GAICD, an engineer, who joined the Australian Theatre for Young People after completing the observer program in 2017.
Rob Conyer was invited to join the board of Montefiore aged care after his 12-month observership, and Mythili Baker joined social enterprise LifeCircle after completing the program in 2018.
Networking events throughout the year, enable participants to make valuable connections that will help them build their careers as directors.
How it works
Having nominated sectors of interest, selected candidates are interviewed by program organisers and board members, who may select one or two observers. Once a selection is made, the observer signs a confidentiality agreement. The program works with NFPs (and a handful of government departments), as issues around confidentiality and potential conflicts of interest are less likely to arise.
“If there’s something extremely sensitive, boards still have the opportunity to ask the observer to excuse themselves from a discussion,” says Gavshon. “But we have found that is the exception.”
During the first two months, AICD facilitators deliver a training program to help participants become versed in the foundations of good governance.
“Those of us who have joined boards without undergoing governance training know you’re stepping into uncharted waters, and it’s a very steep learning curve,” says the director of the Melbourne Observership Program, Catherine Reiser MAICD.
“Within Australia, the program is unique in offering a combination of practical observership while learning about the principles of excellence in a directorship.”
Regardless of whether an observer ultimately joins the board, participants walk away having gained access to some of Australia’s top directors and become part of a growing network of professionals.
“Another fantastic thing that’s emerged organically is the WhatsApp groups that form,” says Gavshon. “People bounce ideas off each other and share articles — we don’t moderate it. It just shows the power of people getting together and wanting to rely on each other.”
Non-executive director of the Bank of New Zealand
Mai Chen has been a non-executive director of the Bank of New Zealand (a subsidiary of NAB) since 2015 and chairs its people and remuneration committee. She also sits on the NZ Audit Committee. The author of Diverse Thinking Capability Audit of New Zealand Boardrooms 2018 and founder of the Superdiversity Institute for Law Policy and Business reflects on her first board role.
“I got my first board role because someone decided to shoulder-tap me and give me a break. Admittedly, I had worked hard and built a professional reputation as a competent lawyer and leader, but plenty of people are good at their day jobs, work hard and go the extra mile. So, impressing the chair is what really counts. They have to decide to give you a go, even if it is other directors [who are] advocating for you. You have to show promise and give chairs the sense you are worth backing and will reward their confidence by working hard and becoming an asset to the organisation and New Zealand. If you do not work hard and make the most of it, you’re unlikely to get another opportunity.”
Mai Chen's advice for aspiring directors:
- Remember most directors are incremental thinkers. If you are a transformational or disruptive thinker, figure out how you can communicate to other directors so they don’t think you’re too left-field. If you don’t communicate your points well, the company will not be able to get full value from what you say.
- Being different may be beneficial. Finally, the future may have come to meet me — being a woman born in Asia may be an advantage. You can stand out, but you also need to learn how to fit in as a team player. Remember that in Australasia, being agreeable is part of the culture, especially for women.
- If you get asked to do something by board chairs or directors, roll up your sleeves and get your hands dirty. Forget the money, if the work is unpaid. You have to show competence and capability or you will never be recommended.
- Find a champion and take advice from directors you want to emulate. Ask them how they got there and do what they tell you.
David Burt GAICD
Executive manager of the CSIRO’s ON program and director of Planet Ark
Early on in your career, the board is a bit of a mystery. It’s only when you start interacting with them that you discover why boards exist.
In 2012, through my executive role at the CSIRO, I was increasingly involved in the process of providing information and analysis to the board. Once I was involved in writing board papers and getting feedback on how they could be better, I became increasingly curious about the role of non-executive directors, the people ultimately accountable for the actions of an organisation.
Not-for-Profit Governance and Performance Study
The AICD published the 10th Not-for-Profit Governance and Performance Study in 2019. The study identified that recruiting younger directors is a key challenge.
Access the report here.
This led me to search for learning opportunities and in 2016 I was referred to the Observership Program, which provided a scholarship for me to attend the AICD Company Directors Course training. This taught me the core governance principles I needed.
The Observership Program matched me with the board of Planet Ark Environmental Foundation, an organisation that aligns strongly with my personal values. Only with hindsight do I realise how important this matching process was. People are often advised to take any board role to get initial experience. This is a mistake. To be a great board member, you have to believe in the mission of the organisation, or you won’t have the motivation to put in the significant effort required.
Over the next year, I attended all Planet Ark board meetings as a non-voting observer, received the full board papers and participated in all discussions. I also met individually with many of the directors. This gave me direct experience of the detailed work of the board and I built my understanding about the fundamental principles of governance and decision-making at board level. There is a steep learning curve to your first board role. You need to build new skills while trying to adjust to the culture of a new professional team. It’s an interesting process adapting to a culture while retaining an independent, enquiring mind. This process was made easier for me because the Planet Ark board has a great culture. Michael Coleman FAICD was an experienced chair who helped me navigate through the integration.
As an executive, you bring an established base of technical skills, networks and commercial experience. It’s helpful to develop your executive career in line with your board aspirations because this base is what makes you valuable as a NED to an organisation. But you also need to learn many new skills and a different mindset to be effective in a board role.
The 12 months of observing let me build trusted relationships with other board members, as well as the executives who had regular contact with the board. It also enabled me to ramp up bringing my perspective and skills to board discussions. There was no expectation beyond the 12-month observership, but fortunately the board invited me to join in 2017.
I’m still on that learning curve of how to be an effective board member. I’ve learned it’s more than just discussions and decisions at board level around strategy, governance and risk management. It’s about building a trusted relationship with the executives. It also involves using my skills and professional network to enable Planet Ark’s mission.
Anyone thinking about their first board role should consider how the program might be relevant for them. Those who lead boards should consider how they are adding the next generation to their board, especially those with skills to understand the new technologies and trends that will impact the organisation.
Aiming to improve both what you know and who you know, AICD South Australia runs the Tomorrow’s Director group. It hosts events, seminars and networking opportunities throughout the year for those starting out in their director career and is open to all ages.
“It can seem a bit of a black box in terms of how you get that first director’s role,” says group chair Stuart Symons GAICD. “This is an opportunity to take those first steps.”
A series of Director Download events features a guest speaker who discusses an issue particularly relevant to emerging directors, such as understanding board minutes. Webinars delve into the nitty-gritty aspects of board work.
There is also a three-part series on helping people find those elusive first positions. Participants reflect on what they can contribute and the organisations that appeal.
Next comes a half-day workshop with about five directors, who help refine a potential director’s pitch. The series ends with the chance to actually deliver the pitch during a speed-networking event with members of not-for-profit boards that are actively looking for new members.
AICD ACT runs a Director Pipeline program and AICD Victoria has a Finding Board Positions workshop.