You are on the board of Twinian Holdings, a mid-market mining contractor with operations in eight countries and 2016 revenues of $495 million. The last few years have been rough for Twinian, though it hasn’t been alone with the whole sector taking a hammering. The collapse in commodity prices has all but shelved new resources developments while existing work is being fiercely contested. Last year’s net loss after tax was $165m.
The board of Twinian’s largest customer Chinese copper and zinc miner QNG Limited has resolved to take a substantial proportion of its business in house. QNG represents over 40% of revenues. QNG’s decision presents a major risk to Twinian. Your CEO has met with QNG’s CEO to discuss a path forward with QNG open to a full takeover of Twinian.
Your CEO has presented three options to the board:
- Do nothing.
- Negotiate a friendly takeover.
- A partial sale.
What do you do?
This was the scenario presented to participants at last year’s inaugural On Board Forums held in Sydney and Melbourne. The program was designed to give emerging female directors contact with the pre-eminent directors in Australia.
Participants in the program learn first hand how an experienced ASX 200 director goes about leading a board discussion and driving consensus on thorny problems that reflect real world dilemmas.
The chairs of the Twinian boards included Commonwealth Bank of Australia Chairman Catherine Livingstone AO FAICD, ANZ Chairman David Gonski AC FAICDLife, and Qantas Chairman Leigh Clifford AO FAICD.
Chairs for the next round being held in Melbourne on 28 March and Sydney on 30 March include Amcor Chairman Graeme Liebelt FAICD, Brambles Chairman Stephen Johns FAICD, Penny Bingham-Hall FAICD, non-executive director of Bluescope, Foretescue Metals and DEXUS, and Diane Grady AM FAICD, non-executive director of Macquarie Group and Spotless Group.
Seeing up close how the foremost directors in Australia do their work is a rare and invaluable experience.
Forum participant Dr Maree Gleeson FAICD, a non-executive director of NSW Health Pathology and Hunter Water Corporation, had Catherine Livingstone as her chair.
“I learned from her how detailed her preparation is prior to coming to a board meeting. Her engagement with board members was also impressive. She took the time to ensure that everyone had a voice and the opportunity to express an opinion,” Gleeson said recalling her board discussion.
Janet Torney FAICD, Chairman of Whitehelm Capital and a non-executive director of the Australian Cricketers’ Association, was impressed by her chair David Gonski’s dedication to achieving an outcome.
“David was inclusive, decisive and challenging. He’s exceptionally knowledgeable. He managed the scope of what we were looking at. His style and his approach were very focused and directed, knowing what was needed for the board to make a decision."
At the end of the discussions, the chairs give personalised feedback to their board members. The great strength of the chair feedback is that it’s not just general advice but is tailored to help you identify strengths and areas for improvement, says Laura Mattiazzi GAICD, Vice Chair of the Food and Agribusiness Committee for the Australia-China Business Council who had Geoff Brundson, a non-executive director of SIMS Metals as her chair.
“Geoff went out of his way to help all of us giving us feedback. That was really really helpful. He wasn’t just patting shoulders. He was saying, ‘Laura, this is an area that you can focus your improvement on,’” Mattiazzi said.
Livingstone even went to the effort of sending emails to each of her board members after the forum outlining her feedback on their performance.
At the end of the discussions, the chairs present the decisions of their boards. Comparing the results is instructive.
“The case studies were very provoking in dealing with very real issues,” Christine Feldmanis, Chairman of Bell Asset Management and a non-executive director of Hunter Water and Perpetual Equities Investment, said. “The approach to the case studies and how they would resolve it were quite different depending on what the focus area was.”
The On Board Forums are not only about the interactions with chairs. Participants also learn from each other. The forums bring together women from a diverse range of backgrounds, many already with extensive board experience.
“The diversity of experience around our board table contributed to the quality of the decision that was made,” Gleeson said. “There were clear differences in how people approached the discussion depending on their background, whether it was, say, legal or accounting or scientific. One of the participants had faced a similar situation to the scenario and hearing how they had dealt with those practicalities in reality was very helpful.”
Building from the connections made during the discussions the forums have helped strengthen networks among the AICD’s female members.
“There were a number of women I got a chance to know. The networking opportunities during and after the event were very strong. All of us had similar experience levels in terms of their board careers. We could share our experiences and talk about opportunities,” Torney said.
The AICD is holding a second round of On Board Forums in Melbourne on 28 March and Sydney on 30 March. As well as the simulated board discussions, each forum includes a keynote speech from one of the chairs and is followed by networking drinks. Numbers are restricted to 42 participants for each event so it is advisable to book early.