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Fiona Shand Principal Shand & Associates, Lawyers and Advisers
07 March 2011
\"The old adage, \"if it ain't broke don't fix it\", just doesn't stand up to even cursory scrutiny in today's corporate environment.\"
We all know the figure: female directors make up only 8.3% of boards in the ASX 200. And we know pressure for change to that figure is mounting.
Lawyer Fiona Shand has \"drunk the Kool-Aid\", as she terms it. She passionately wants to grow the level of female participation at senior management and board level... but not at the expense of an individual's best interests.
Why join the club
\"It's flattering to be invited [onto a board],\" says Fiona. \"But you have to ask yourself what does it mean? Will there be risks? What are my safeguards? Do I really need to be there or in fact want to be there? Have I taken into consideration who I am, what I want out of the position and what I can give to the company? What does the position demand of me, and what does my life already involve that may be compromised?\"
Fiona believes in \"scaring\" potential board candidates with the very real risks and obligations involved, and then providing them with ways of managing and eliminating those risks. She also sees that women often do understand the potential problems and that can turn them from taking the challenge, while also acknowledging that many women just don't want to face another battle against the \"blindness to opportunity, apathy and lack of imagination\" inherent in male dominated business arenas.
It's more than a dozen years ago now, and Fiona well remembers the matter. She was representing the director of a small company that had got into trouble early. Once the dust settled, she could clearly see why it had happened and was forthright enough to recommend what not to do again.
\"I didn't want people repeating mistakes, coming back time and again – it's boring,\" admits Fiona, who then secured an overseas posting working more and more around the \"director's space\".
\"In Switzerland where I worked in the pharmaceutical industry, and also in Hong Kong, I reported to boards and committees on legal, governance and compliance issues. When I came back to Australia, a friend of my family's, who did everything on a handshake, engaged my services after being taken advantage of by an unscrupulous business partner.
\"He liked what I did and firmly told me to go out and educate people about what a director should do, and if I didn't educate people (to avoid others falling into his predicament) as part of the solution then I was part of the problem.\"
Fiona's first thoughts were that no one was going to listen.
\"My friend said, 'Well, I listened, and so will my friends.' True to his word he brought 30 of his mates along to a speech I gave on corporate governance and being a director, and it just grew from there. The AICD saw me and said, 'You should be lecturing for us.' I've been doing their gig a few days a month for two years now, in Australia and internationally.\"
And that's on top of the day job, where Fiona specialises in resolving corporate and directorial governance, shareholder and general commercial issues, disputes and litigation. Preferably, as she points out, avoiding litigation.
\"I can't stress it enough, whether it's a not-for-profit, association or company, the liabilities and responsibilities for directors are basically the same.\"
It's important to remember, notes Fiona, board decisions are not individualised i.e. who voted for what proposal. Whatever the upshot, each member is involved in the outcomes.
Board members have duties (enshrined in law) and if something goes wrong, reliance on the advice of other people may not be a complete defence. (Having represented Ray Williams during and after the HIH Royal Commission, Fiona is well-positioned to point out this fact.)
\"As a board member, you must bring your own individual assessment of the situation to the table. You cannot rely blindly on the advice of other board members, or advisors such as lawyers or accountants. If a decision does not stand the 'daylight test' for you - the front page of the morning paper - then question it.
\"It's important to identify the risks and manage them. You have rights of access to company information, including financial. So know your company. You also need to know yourself: skills, expertise, experience and your own availability and level of interest, and bring that into the equation when determining if you want to be on a board or a particular board.
\"For women, you want to be heard and not find you are there simply to introduce oestrogen, The rule of thumb (see the McKinsey reports and Catalyst studies) is there must be at least 3 senior women, either direct reports or on the board, in place, to change the dynamic. This is the minimum critical mass that is needed to influence and change the discussion.\"
Why it has to change
For Fiona, boards exist to provide oversight of management and strategic direction. The world, business, economies have changed and it's time companies - including senior management and boards - reflected this.
\"Board diversity is important. The old paradigm 'Pale, Male, Stale' has not served business well in recent times.
\"The lack of diversity can lead to an inability to see, gauge and avoid risks because, when you have boards and top management inhabited with people of similar experience, education, corporate and executive histories, these very similarities can, and often do, lead to similar blind spots and expectations. What's 'acceptable' to those with the same experiences may not be as acceptable to someone with different experiences and expectations.\"
Fiona's experiences have only confirmed for her that diversity opens up the discussion, and although it may not always end in better overall decisions there will be better and broader discussions which may lead to different considerations and that can only be an improvement.
\"In the end, change will happen because it really has nothing to do with gender balance any more... it is a business imperative. Women make most of the consumer buying decisions worldwide and are half the talent pool of employees. The companies that fail to recognise their market and half their talent pool will be the ones that lose the commercial battle. \"
Knowing my family is proud of me
Growing female participation at senior management and board level
Raising my son to achieve his best
Justice and equality
Family and friends
\"There are some things I really dislike - bullies and abuse of power, discrimination and prejudice - especially based on fear of change or the desire to maintain personal comfort.\"