Category Archives: Leadership

Winter blues

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I think I may be suffering the early onset of SAD (seasonally adjusted disorder). Even though the Australian winter only started at the beginning of June, I am already feeling the cold and the despondency. My condition is not helped by the knowledge we don’t have another public holiday until early November. Or maybe it’s a symptom of the current national mood, which suggests that although we are highly likely to vote for a change of government in the forthcoming federal election, we don’t exactly relish the prospect.

According to the latest opinion poll, most of us would actually prefer to see a former leader of both the two main political parties lead their respective sides into the election, rather than the present incumbents. Given our compulsory voting law, the preferential voting methodology, and the parliamentary system for choosing party leaders, the electorate is basically denied the opportunity to vote for its preferred Prime Ministerial candidate.

The general election campaign is taking place against the backdrop of an extraordinary period of critical self-analysis about the type of society we live in. For various reasons, our politicians, the media and the chattering classes have been debating the notion of whether or not Australia is a classless society, a racist society, or a sexist society. (To which questions the answer would probably be: “Possibly, but not all the time, and not everywhere.”)

Much of the surface debate has been prompted by behaviour and language generally deemed offensive, and by arguments about whether people actually meant (or understood) what they said or did, whether they appreciated the impact of their deeds, or whether they simply didn’t know any better. While everyone should be held accountable for their individual behaviour, this is not just about semantics, or different moral standards or conflicting social attitudes; after all, Australia is ostensibly an egalitarian, pluralistic and secular country, founded on the notion of “a fair go for all”.

I think this national malaise stems from a collective failure of leadership, which in turn leads to disrespect for our leaders and disregard for the institutions they represent. This failure of leadership is especially acute among institutions that were primarily designed to promote, serve, protect and cater to the interests of the working population. Too often in recent years have leaders, office holders and key figures within political parties, trade unions, religious orders, the armed forces, the media and even major sporting codes been found wanting in upholding a culture of robust ethical behaviour and acceptable moral standards. Quite rightly, people feel angry, demoralised and almost disenfranchised because they have been let down by the very establishments they believe were designed to be there to support and represent them.

It’s not surprising, therefore, that much of the population is tuning out of the election debate (such as it is) because they have little faith in our political leaders in particular, and in public institutions as a whole. Cynicism, even despair, prevails. Hence the mid-winter chill….

Corporate Governance – exercising a “duty of awareness” in the age of social media

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Do we need a new theory of Corporate Governance? Is it time to look at a new model that reflects the current environment in which businesses operate, an era characterised by:

  • social media,
  • corporate and social responsibility,
  • shareholder and consumer activism,
  • increased market connectivity, and
  • rapid generational change?

Has the law fallen behind in being able to regulate and oversee contemporary corporate behaviour – where compliance with and adherence to the letter of the law may no longer be enough to meet community standards or satisfy shareholder expectations?

The question arose during a roundtable discussion I attended recently, comprising non-executive directors, entrepreneurs, corporate advisers and governance experts. Some of the issues we kicked around included:

  • the efficacy of running more frequent board interaction via the use of technology (as opposed to the standard face-to-face monthly board meeting);
  • the ethics of minimising cross-border taxation by multinational companies (even though it may be legal under international tax law);
  • the imperative to develop more inclusive and diversified boards (including networking into broader stakeholder groups);
  • the perils of ill-considered public comments made by CEOs (and the resulting social media backlash); and
  • the risk of harking back to some “golden age” of corporate behaviour (assuming such an era actually existed)

Our current perspectives on Corporate Governance largely derive from the late 1980s and early 1990s when a series of authoritative studies and reports led to new Codes of Practice and updated corporations laws – I’m referring to the work done by and in the name of Tricker, Carver, Monks, Cadbury, Greenbury, Hilmer and Hempel. And while in recent years we have seen increased scrutiny on CSR, directors’ remuneration and financial oversight by boards (plus Sarbanes-Oxley, Dodd-Frank and IFRS), the reality is that most of the earlier Corporate Governance reforms were introduced just as the internet went public and just as financial markets were being deregulated. So it could be argued that the reforms were ill-equipped for, or could not have anticipated, the changes to come – witness for example, the SEC’s recent approval of social media as an appropriate platform for corporate disclosure.

In Australia, Corporate Governance is described simply as “good decisions being made by the right person”, and the obligations of company directors are summarised as follows:

  • your primary duty is to the shareholders;
  • you must act with appropriate due care and diligence;
  • you must not allow the company to trade while insolvent;
  • you must exercise your powers in good faith and in the best interests of the company;
  • you must not improperly use your position of (or information obtained as) a director to benefit yourself or another person, or to cause detriment to the company.

On one level, the test of whether an organization has exercised good judgement in making a decision is, “would you be embarrassed if this was reported on the front page of tomorrow’s newspaper?” At another, Corporate Governance is reduced to a compliance checklist of risk mitigation measures.

The Australian courts (in the OneTel and Centro cases) have expanded and reinforced the duty of care (particularly in relation to the business judgement rule) to place greater accountability on individual directors to consider what a reasonable person would do in exercising their duty of care and diligence:

  • To understand the fundamentals of the business
  • To keep themselves informed of the company’s activities
  • To monitor the company’s activities (e.g., through active questioning)

The question we should be addressing is: “Does imposing a broad duty of care and specific fiduciary obligations ensure an appropriate level of Corporate Governance?” I would argue that in light of a rapidly changing operating environment, we would be well-advised to exercise a “duty of awareness” in respect of our Corporate Governance standards. In my view, directors need to take a wider perspective in understanding and monitoring the business fundamentals and the company’s activities. Some may argue that this is not a new duty, it has simply been forgotten in recent times – and in the era of social media, when it is far easier to “get caught out”, it would be prudent to have more regard for the broader context.

A “duty of awareness” offers an appropriate counter-balance to the numerous areas of self-regulation by industry sectors and by individual companies. It provides an objective test for assessing “if not, why not” explanations required under both voluntary and mandatory Codes of Practice – i.e., did the respondent take into account all relevant factors, and did the respondent adopt a sufficient level of awareness in evaluating its options under a chosen course of action?

The “duty of awareness” means that at an individual level, directors would be obliged to reflect on their contribution to and participation in board decisions; boards would need to consider the likely impact of their decisions on the company’s performance and on wider stakeholders; and companies would be expected to have regard to their standing as a good corporate citizen, not merely a compliant one.

Acknowledgements: I am grateful to Andrew Donovan of Thoughtpost Governance and Dale Simpson of Bravo Consulting Group for their invaluable contributions to this article.

Portfolio, Portmanteau or Protean: what shape is your career?

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In a previous article, I commented on the non-linear nature of career development in the Information Age, in response to changes brought about by new technology, market dynamics and demographic trends.

Following recent research and policy proposals on workforce flexibility and workplace productivity by the Australian Workforce and Productivity Agency and the Australian Industry Group it is clear that more than ever, employees must take more responsibility for managing their own career, and be willing to embrace life-long learning and skills re-training to navigate non-traditional career paths.

Whether it is the need to address the current shortage of IT skills, or the need to prepare for the post-mining boom, employers will have to re-think traditional approaches to hiring, engaging and performance managing the workforce; and employees will be obliged to re-think the shape of a traditional career trajectory to take advantage of new opportunities, and to remain relevant in the modern workplace.

There are essentially three career models emerging: Portfolio, Portmanteau and Protean.

Portfolio Career: this model is probably quite familiar to more mature workers, who have embarked on a mix of different career activities, either as a planned transition to retirement or as a means to re-enter the workforce; or by default in response to external changes in employment circumstances.

In this scenario, someone might work part-time in a paid job or consulting role, volunteer part-time for a not-for-profit organisation and hold 1 or 2 non-executive board positions. In my own case, for example, I consult to a number of corporate clients on a regular basis, I am a member of an advisory board for a family owned business, I am working on start-up projects, and I have also been known to do some broadcasting on community radio. My significant other, meanwhile, balances a part-time job in accounting with her practice as an artist and art teacher.

This portfolio career model is no longer the exclusive domain of baby-boomers – witness a former and much younger colleague of mine who undertakes a series of HR contract roles, while helping to build a new IT business with her partner. The portfolio career typically appeals to people who enjoy a variety of different activities, have a broader mix of skills and experience, or who wish to create a personal work-life balance.

Portmanteau Career: this is a term I have coined myself, in an attempt to describe a career model that applies to either meaning of “portmanteau” – a) a travelling case, or b) a compound word.

In the former meaning, a portmanteau career is one where an employee’s skills are easily transferable to another role, a different organization, or even a new industry – the skills are literally portable, and can be carried from place to place. In my own case, I once transitioned from law publishing to financial information services, even though at the time I knew little about the latter – it was the core skills around content development, product management and commercial publishing models that were applicable and relevant.

In the latter meaning, a portmanteau career can be a product of new and emerging technologies or sectors. For example, digital media and social networks (in themselves, “portmanteau” industries) are attracting people with a mix of IT and marketing skills, a combination that would have been highly unlikely 10-15 years ago.

Protean Career: the protean career model is not a new concept but has been brought into the spotlight by the current economic environment, a supply/demand mismatch in skills, and the challenge of employees taking responsibility for their own careers. This challenge especially applies to employees coming into the workplace for the first time – even recent graduates who have gravitated towards a specific career path or vocation based on their choice of courses and qualifications  must be cognizant of the fact that they need to maintain and update their skills and knowledge once they enter the workforce.

In my own case, after graduating in law, and following a career as a paralegal, I decided I wanted to make a move into publishing. I retrained as an editor, and then looked for roles where I could combine my academic qualification with my personal interest – resulting in a successful career in law publishing.

I would summarise the protean career model as one where the individual defines, manages and determines his or her own destiny, rather than letting a career “happen” to them. It requires a pro-active approach to career management, combined with continuous skills improvement, supported by formal and informal learning, a willingness to embrace flexibility, an appetite for taking informed risks – and all underpinned by heightened self-awareness gained through experience and enhanced personal development.

The person who understands and pursues a protean career will likely be creating their own work, managing their own work preferences, and making easier and happier work choices.

In each of these career models, employers must also be willing to embrace flexibility, to adopt creative solutions for hiring and engaging their workforce, and to resist traditional “square pegs for square holes” resourcing models. As the productivity and flexibility debate continues to gain traction, the opportunity to re-think traditional approaches to career development and career management should not be lost in the noise.

Would you take career advice from a sushi chef?

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The cohorts of Baby Boomers who entered the workforce during the latter stages of the Industrial Age represent the last generation who contemplated lifelong employment in the same career, if not in the same organization or even in the same job. Here in the Information Age, with increasing numbers of employees engaged in knowledge work, the notion of a single career for life, let alone a single job for life, is pure fantasy.

In the Information Age, our willingness to embrace career change is as important as our ability to develop and maintain our core technical skills. For example, while we may think it is necessary to become experts in the latest technology, it’s equally important to understand how and why that technology is being deployed in particular situations – this is where the real learning occurs, as both the content and the context for that technical application will inevitably change.

The Agrarian Age helped define the concept of life-long occupations – in agriculture, the military, government service, science and medicine, the trades and professions, and even among unskilled labourers.  Think of the workers who toiled their whole lives on building the great mediaeval cathedrals, never to see the final results of their labour as those major construction projects took several generations to complete.

The Industrial Age ushered in occupations that relied on workers acquiring and applying technical, practical and manual skills that in essence changed very little during their lifetime, particularly on manufacturing production lines. This era also saw the development of the formal workplace and business establishments, in contrast to the largely home-based work patterns of before.

The Information Age continues to see rapid changes in workplace structures, employment patterns and career development. This change demands that knowledge workers constantly improve their skills – keeping up to date with new technology, engaging in the latest management theory, embracing new business models. This continuous learning process is not best served by staying in the same role, the same environment or the same mindset for lengthy periods. Personal change is a surer way of keeping in touch with universal changes.

So for latter-day job seekers who are looking for insights into their own career choices and options, why would they take career advice from someone who has been doing the exact same thing for 50 years or more?  I was reminded of this when a recent edition of my high school alumni newsletter reported that a long-serving member of staff had retired after more than 40 years in the job. During my own time at the school, this particular teacher was also the careers adviser, and without meaning to disrespect his teaching abilities, why would anyone take careers advice from someone who had stayed in the same job his whole career?

And yet, who could fail to appreciate the explicit career advice in the critically acclaimed documentary, “Jiro Dreams of Sushi” (made by David Gelb in 2011)?

Jiro Ono has been making sushi for over 70 years, but continues to hone his skills as a sushi shokunin, always seeking perfection, constantly finding new and better ways to create his dishes. As a master sushi chef, Jiro makes sure he knows his suppliers and is familiar with their produce. As a leader he is quick to acknowledge that the food he serves to his customers is the result of much hard work and detailed preparation by his team of chefs. As a teacher, his Michelin 3-Star restaurant also offers lengthy (and highly valued) apprenticeships to aspiring itamae who are willing to dedicate themselves to pursuing their craft.

Even though the daily process of producing the highest quality sushi seems repetitive and even tedious, it is the willingness to face each day as both a new challenge and a fresh opportunity to improve one’s skills that gives Jiro his core purpose and sense of career satisfaction.

From personal experience, my own career development continues to be about defining my core values and improving my skills, understanding how to apply them in new situations, and how to enhance them by learning from colleagues, mentors, clients, suppliers and competitors, or from on-the-job and formal training.  Like Jiro the sushi shinkonin, I try and make this a daily process, by reflecting on how something can be done better or by understanding how new information can be incorporated into existing solutions.

Many of us working in the Information Age will recognize that we don’t pursue a single, linear career path, but engage in a series of both distinct and overlapping career sequences, connected by a common thread of transferable skills and inter-disciplinary learning applied to new roles, new projects or to new client engagements. Our challenge is to ensure we maintain purpose, relevance and a sense of direction as we navigate our “transactional” careers.

Footnote: The soundtrack for “Jiro Dreams of Sushi” features several compositions by Philip Glass, which seems totally appropriate, on several levels:  Glass, like fellow minimalist John Cage, is attracted to various aspects of Japanese culture; and as a minimalist, Glass’s music is often criticised for being repetitive, even boring – but attentive listening reveals that the repetitions subtly shift, revealing minuscule changes in pattern, rhythm and texture – much like every piece of sushi tastes subtly different.