- Richard Perry FCA believes failure is a mark of success
- It was like a dream come true because I was actually going to run the financials for New Zealand's biggest farmer
- I've always been a bit of a ‘New Zealand Inc’ person and I believe we have to understand that failure is actually a good thing
By Beck Eleven
Photography by Mark Tantrum
Richard Perry FCA believes failure is a mark of success.
And the highly-experienced chief financial officer at Callaghan Innovation considers himself “just a basic bugger from the country”.
Growing up in Marton, in rural New Zealand, Perry thought farming seemed like a logical step. His dad was a schoolteacher and his mother a physiotherapist, but they had both come from dairy backgrounds.
Then one day a career advisor visited Perry’s school.
“So, what do you want to be?” his father asked.
“I worked out I want to be a farmer, Dad.”
“Well, you’re not going to be a farmer if you don't own any land,” his father told him.
So young Perry settled on accounting, believing it might earn him enough money to buy some land and fulfil that farming dream.
Four university years later, with a first class honours degree under his cap, he took a job in a government audit office before spending 13 years in various roles at the Reserve Bank.
At Otago University, Perry had done his dissertation in farm accounting services and farmers’ perceptions of accountants.
“People thought I was nuts,” he says.
“I just had this thing that if I couldn't be a farmer I wanted to be in the ag sector so I could help farmers.”
By some quirk of fate, the opportunity arose in 2003 to apply for the CFO role at state-owned farm business Landcorp New Zealand.
“It was like a dream come true because I was actually going to run the financials for New Zealand's biggest farmer.”
When he started Landcorp had a balance sheet of around NZ$700m. By the time he left a decade later, it was a NZ$1.7b enterprise.
A balanced philosophy
Perry, 48, has a deep belief that one of the most important relationships in an organisation is between the CFO and the CEO.
“That’s the way you maximise value,” he says.
“I think of the CFO’s role like the vanguard. A CFO has to be out in front a lot of the time, they have to know where the CEO is heading so they can prepare the ground or at least understand the issues that are coming ahead so that preparations can be made.
“Obviously, the CEO is who you report to, but by the same token there's no point in a CFO being deferential or afraid because you may be required to say no or suggest another direction.
“It’s an important relationship and it needs to be based on trust and mutual respect.”
His viewpoint is that a CFO must have an understanding of the wider sector and economy. Being inward-looking does not foster growth.
“Of course you still have to manage those important day-to-day things — like making money, paying bills, managing risks and being aware of legal issues. But for many years now there has been a deepening of the CFO role."
Unlike some chartered accountants, Perry does not relish minutiae.
“It would probably shock people to know that I hate detail,” he smiles.
“Maybe that's just my makeup but I've always been more interested in the helicopter approach where you're able to understand issues at the strategic high level.
“I much prefer to have a complementary team for the detail-sweeping and fine-tuning.”
He also takes a holistic approach to governance structures.
“As a person who's been round boards and board tables as an executive, I've been a director on and off for ten years as well, that whole game is changing and I worry that we're pushing ourselves into a world where we learn governance from a manual and it's rules-based.
“I'm a principles person. I believe we should have sound principles and governance should be all about giving certainty and understanding of the strategy that is required to be executed. Then they can give management and the executive, the tools and support they need.
“There's a really interesting tension between how you create these agile, fast, nimble, flexible organisations but, at the same time, don't overburden them with inefficiency in terms of reporting governance.”
In 2014, Perry was awarded a fellowship of Chartered Accountants Australia and New Zealand, an honour he says was only possible given the support of fantastic colleagues.
“You can't bugger off and be ahead of the CEO unless you've got really good people alongside you.
“I think of my life as a three-legged stool. The legs are: my job, that's very important; my family, that's very important; and then myself, which is my interests and hobbies. Whilst my job takes up a lot of my life, you have to keep that in balance with your family and yourself, otherwise life doesn't go ahead.”
To that end, he is an outdoorsman, “a crazy hunter, a deer stalker and pig hunter”.
With his wife and three children aged 18, 15 and 12, he spends weekends in the bush, running around the hills or paddleboarding at the beach.
If we can bring people together, then two or three can go off to market together rather than fight for a small piece of the pie as individuals.
A company called Innovation
As Perry began thinking about the next step after Landcorp, he toyed with the idea of a CEO role but was lured to Callaghan Innovation by its former CEO, Mary Quin.
“Basically, she said to me ‘every world-class CEO knows that they need an even better CFO’. I realised she did think of the roles as a partnership, as something complementary, not hierarchical.”
It fitted with his philosophy.
Callaghan is a government agency charged with making New Zealand's research-led business more innovative. He says New Zealand businesses have traditionally focused on domestic markets and the country hasn’t moved swiftly enough to position itself globally.
“So it’s been an interesting challenge,” he says.
“I've always been a bit of a ‘New Zealand Inc’ person and I believe we have to understand that failure is actually a good thing.
“If you look at other countries, like Israel and other places, failure of innovators is accepted. These guys in Silicon Valley, they fail six times before they're successful.
“In New Zealand we tend to laugh if a business fails but some of the best things you learn in life come from the worst experiences.”
Much of Perry’s attitude comes from early international experience. In the early 1990s, he was one of the youngest consultants in New Zealand to be a technical advisor to the International Monetary Fund.
“I got to see lots of different parts of the world and give advice to lots of countries around the world, particularly in the areas of central banking, governance and financial management.
“What always used to frustrate me whenever I came home from those extended missions is there'd be big issues going on in the world, and you'd get home to find domestic issues dominating our conversations.
“I understand we do that in New Zealand — probably because of our border and isolation — but we tend to focus on a lot of bloody silly stuff.
“Callaghan Innovation's whole mission is about helping the New Zealand economy diversify so we should be paying attention to global issues.”
Perry belts off plenty of examples where he thinks New Zealand could compete at world-class level. Like having a world-class university instead of each domestic university competing against the others, boosting exports in the food and beverage sector, and harnessing New Zealand’s world-beating natural resource endowments.
“It’s about moving faster, it's about harnessing what we do have.
“It’s about how we get innovative about collaborating with other people in the economy rather than competing against them.
“If we can bring people together, then two or three can go off to market together rather than fight for a small piece of the pie as individuals.
“New Zealanders still think about being disruptive around products when they actually need to be disruptive across a whole set of innovation areas.”
Instead of simply focussing on the product, people need to consciously and actively innovate around all areas of a business from the profit model, network structure process, product performance, systems, brand and customer engagement.
“That’s where things get really exciting.”
Perry isn’t afraid to hold back. He’ll speak his mind but if no one’s interested, he’ll just go out for a run and tell his dog.
“I think I’m still that boy from Marton, just a basic bugger from the country.”
Beck Eleven is a journalist based in Christchurch.
This article was first published in the October 2016 issue of Acuity magazine.