- The make up of a successful board is more about being creative rather than following any set protocols.
- A background in chartered accountancy is a good foundation to becoming an effective director.
- Working inside a framework where there is good, responsible government will lead to a prosperous economy and benefit the community.
By Alexandra Johnson.
Melbourne-based Paula Dwyer FCA is a seasoned director and board chair, but she didn’t set out in her career to deliberately become so.
Now chairman of Tabcorp Holdings Limited and Healthscope Limited, and director of the ANZ Banking Group and Lion Pty Limited, she began working as a chartered accountant at PwC in the mid-1980s. She then went into corporate finance at Ord Minnett, then took up lead financial advisory roles with the Victorian Government, before moving into funds management and investment in Australian equities.
It was not till 2000 that Dwyer began her career as a non-executive director, building a portfolio of directorships in the government and not-for-profit sectors. In 2002 she joined the board of Promina Group Ltd. And by 2015, The Australian newspaper had named her in the top 20 most powerful women in Australian business.
“I didn’t plan to become a non-executive director. I had left my position in funds management but I wanted to be active commercially, so I took on a couple of board roles,” she says. “It suited where I was at that time of my life in terms of wanting to keep an active involvement in business, but not necessarily at an executive level.”
Dwyer says she had reached a level of seniority in her profession, “and the view was that I could contribute at board level leveraging my executive skills”.
The composition of a successful board is more art than science and you can’t become a director simply by following a process, she says.
“I think that it’s misleading to say that if you do this and that in your career then an opportunity for a director role will arise. A lot of aspiring directors with very successful professional lives have found that they take the steps which should position them for a board career, and it just doesn’t happen.”
The composition of a successful board is more art than science and you can’t become a director simply by following a process.She feels fortunate for the opportunities and support she’s had.
Many factors come into play in terms of being an effective director. Background, skills and experience are important elements, but so too are key attributes such as diplomacy and the ability to work in a team. And a background in chartered accountancy gives you a solid grounding, she says.
“I’ve been chairman and a director in a range of companies and one of the key responsibilities of the board is overseeing the release of financial information about the company to investors. My financial experience, and the discipline and experience I acquired as a CA working with a range of clients in a CA firm, have really underpinned my career.”
While she did not have a specific mentor per se, Dwyer says she has sought advice from wise people over the course of her career. She is a keen observer of people and reads widely to inform her views about how corporations are run.
“I think I’ve learned over time what good looks like and what not-so-good looks like,” she says.
“I was certainly exposed to really positive leadership at PwC and at Ord Minnett and, like everyone, had both positive and negative experiences, all of which you learn from, which lead to the person you become, I suppose. All of those experiences go into the mix.”
But leadership doesn’t come from expertise and having a background in accountancy doesn’t mean you have the last say in financial matters on a board, she says.
“As a director you work as a team so there is no domain expertise which means you have a final decision. The skills and experience of the whole team are brought into the conversation. In fact there are times where those who don’t have domain expertise make the most valuable contribution.”
Taking a gamble
Dwyer says some people have challenged her about being chairman of a gambling organisation.
“People have asked how do you chair a gambling company? Don’t the ethical considerations trouble you?”
When she joined Tabcorp’s board the chairman at the time persuaded her by pointing out that governments are very heavily reliant on the revenue of gambling companies and that gambling products can have profoundly negative impacts on communities if they are not delivered responsibly.
“It’s really important that these companies are well governed and I was persuaded I could make a contribution to that. Gambling companies, which after all conduct legal activities, should not be swept under the carpet... and we’ve got an absolutely first class board, executive team and workforce who deserve to be proud of what we do.”
Dwyer also enjoys her role as chairman of Healthscope Ltd, Australia’s second largest healthcare company.
Healthscope has a strong commercial focus but also a strong community role, she says.
“I enjoy the responsibility that comes with leadership and board work. For me it’s important to continue to step up, to continue to challenge myself. It suits my personality and interests me. It’s very important to bring your whole person to a job.”
Dwyer also enjoys being involved in the wider community debate. She is frustrated with the political landscape in Australia, which she believes is preventing the policy reforms that business needs. “People recognise we need policies that are conducive to economic prosperity, but politically the climate prevents strong policy leadership. In Australia, we need tax reform – the tax framework is complex and inefficient.
“We need labour market reform to simplify the overall system and to provide much-needed flexibility, but because of the composition of parliament it is difficult to introduce policies to achieve that. And that affects business.”
She says a prosperous economy leads to the material wellbeing of the community and everyone is struggling to reconcile community expectations around responsibility and regulatory oversight while generating good economic returns.
At board level, there is an increased expectation of accountability and transparency. Dwyer says that people take the responsibilities of directorship very seriously. The days of the imperial chief executive, when the board just rubberstamps management’s initiatives, are over.
“I don’t think that situation exists anymore. There is a collaborative effort between the management teams and the board to responsibly deliver sustainable, competitive investment returns. It’s not that management does all the work and then presents it to the board.”
She says the role of a director is becoming more iterative and the interaction with management more frequent.
More diversity needed
Dwyer believes that more women need to be more involved in deciding where capital is invested in communities.
“And that goes across the spectrum of finance, capital markets and into companies. Generally, finance is a very white male club in Australia.” If investors want better outcomes, she says, they are better served if capital is allocated by diverse teams – and all manner of evidence exists for that proposition.
“From the board down there are compelling arguments for gender diversity, and the same principles apply to ethnic diversity.”
People from different backgrounds bring their perspectives and ideas and, although working together might not always be comfortable, this leads to better outcomes than come from a homogenous group making a decision.
Change is needed across many sectors in Australia, from the government down.
While there is an increased focus on enabling women to achieve senior leadership positions, now we need results in terms of more women being appointed, she believes.
“People say ‘it’s really desirable to have women in these positions, but unfortunately we just couldn’t achieve our goal’. I think the achievement of goals would be much greater if there were financial consequences for not achieving the goal around diversity.
“I’m not in favour of quotas per se, I am in favour of hard targets and consequences for not achieving hard targets.”
And she believes change is needed across many sectors in Australia, from the government down.
“Up until the end of last year, before the recent reshuffle, we had one woman of 19 members in federal Cabinet – and now we have two. How can that not be an issue for Australia?”
She says the system is weighted against women pursuing life long careers. “For example we don’t have tax deductible childcare in Australia.”
On the other hand, she says more women need to have the discomfort of stepping up and taking on these roles.
“There has been lots written about how men’s disposition is to speak of their successes, while women tend to speak of their inadequacies.
“While I’m not promoting that women get male attributes, the question is, how do we better play the game of commerce to achieve our own goals as women? The system isn’t going change to such an extent in that there will be a whole new set of rules.
“There are going to have to be more women who say well if not, what am I going to do about it?”
This story was first published in the May 2015 issue of Acuity magazine.