The moments that made 2018 the year of governance

Directors comment on the biggest events of 2018, from the banking Royal Commission, culture in sport, trust and #metoo.

It’s been a big year for matters of culture, trust and governance. We summarise events from the year that was and AICD members from Port Hedland to Seattle pause to reflect on the achievements and issues raised.

Sharad Kohli FAICD

Port Hedland, WA – Deputy Harbour Master, Port Hedland, Pilbara Port Authority

Pilbara Ports Authority is the world’s largest bulk export port authority, responsible for approximately 75 per cent of the state’s — and approximately 50 per cent of the world’s —seaborne iron ore exports. Other major commodities include LNG and salt. At Port Hedland, we see on average 500 shipping movements per month. The port has a high tidal range (7.3m to 2m) and it is our role to guide ships through the harbour and shipping channel in a safe and efficient manner.

I started at Port Hedland in May 2017 and this year, completed the Company Directors Course, which gave me a clear understanding of financial, risk and strategy management that directly relates to my position at the port.

Annette King FAICD

Melbourne – Co-founder Galileo Platforms, non-executive director FNZ and Actuaries Institute of Australia

I was based in Singapore and Hong Kong for the past 14 years (including roles with AXA, CEO of Manulife Singapore and vice-president of client centricity, brand and communications at Manulife Asia). This has been a year of change. FNZ has been growing rapidly and completed a private equity exit in October (one of the largest fintech transactions globally in 2018). We also completed a Series A round of funding for Galileo Platforms, an insurance tech company that uses blockchain technology to streamline transactions and provide data analytics. I joined the board of my professional body, the Actuaries Institute, and stepped down from the AICD Hong Kong Committee when I moved back to Melbourne. I’ve been reconnecting with my Australian networks and it’s been interesting to engage with the issues facing the financial services sector.

Sue-Anne Wallace AM FAICD

Sydney – Chair Customer Owned Banking Code Compliance Committee, deputy chair Fundraising Institute Australia Code Authority

In 2018, the bar is being raised on governance. It was satisfying to see the culmination of a substantial piece of policy work to help charities improve how they handle complaints. It is something I’ve been working on since my Churchill Fellowship in 2014. I’ve collaborated with 10 national peak bodies in the sector and in April 2018, we launched a model complaint policy and procedures. This outlines the key principles and concepts of an effective and efficient complaint management system. The aim is to ensure complaints are handled confidentially, safely and efficiently to improve confidence in the work of charities. We were happy to see the Australian Charities and Not-for-profits Commission chair Gary Johns acknowledge this work, elements of which have been included in AICD’s proposed NFP governance guidelines. For directors, a good complaint handling culture is a really useful risk management strategy.

Tim Jackson GAICD

Adelaide – Chair Lighthouse Disability, director Junction Australia, co-founder/director The Volunteers’ Foundation and Mutual

It has been an extremely challenging year with the transition to the National Disability Insurance Scheme. We were proud that Lighthouse Disability posted a small operating surplus of $113,000 on revenue of just under $19m and believe we are well positioned to successfully transition to the new scheme.

This year our AGM was punctuated by music from the disco for our clients going on next door — it was better attended than the AGM!

Fortunately, AGM attendees were able to join our clients after about an hour. Another highlight this year was the opportunity to participate in a study tour of UK cooperatives and mutuals with the Business Council of Co-operatives and Mutuals. It is a rapidly growing sector and it is good to see bipartisan support for federal policy changes to help support the sector.

Nick Austin FAICD

Seattle – Director agricultural development, Global Development Program, Bill & Melinda Gates Foundation

I joined the Bill & Melinda Gates Foundation in early 2017, and lead a team that works to reduce poverty for farming families in sub-Saharan Africa and South Asia. The livelihoods of three quarters of the world’s poor depend on agriculture typically characterised by low or very low levels of productivity. Our goal is to improve agricultural productivity, incomes and diets, with a focus on economic empowerment for women in resource-poor farm families. Rapidly growing populations, changing diets and climate change are placing greater pressure on the world’s food supply.

Climate change is no longer a distant threat. The UN Food and Agriculture Organization (FAO) 2018 State of Food Security and Nutrition in the World report showed for the third year straight — and after a long period of decline — the number of undernourished people in the world has increased: 821 million people are undernourished; up from 804 million in 2016, one out of every nine people on the planet. In the past quarter-century, the world has made extraordinary strides in lifting people out of poverty. The question now is: how do we best meet the challenges in the coming decades? Innovation in agriculture is one of the most effective solutions.

Susy Daw GAICD

Adelaide – AICD facilitator

Much has been written about the #MeToo movement in the past year and I hope this causes a major rethink in the workplace and by boards. It made me reflect on my early career as a registered nurse and how I was the target of unwanted attention by a surgeon in the small private hospital where I worked.

One day, after a patient noticed, I decided enough was enough and knocked on the door of the CEO to make a formal complaint. She told me the surgeon “brought too much money into the hospital” and all I could do was change my shift. So I did. Recently, I discussed the incident and its outcome with that CEO and she was mortified. We both understood if she had taken action, the board may well have sacked her. The culture was clearly set by the board and the incentive was profit.

So how should organisations respond? There are four ways:

• Have women on boards
• Hire CEOs who can ensure the right culture set by the board permeates all levels of the organisation
• Have policies and procedures that empower staff to speak up
• Ensure complaints and incidents are acted on promptly and fairly.