MAGAZINE DIRECTORSHIP - THE MOTIVATIONAL EDITION - IODSA
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DIRECTORSHIP
MAGAZINE
The Motivational Edition
Directorship Magazine I
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Directorship
1 Magazine 2020/01/20 15:01:55
CONTENT
2 FROM THE CEO
A year of E2 leadership
6 COVER STORY
Cynthia Stimpel on doing the right thing
10 THE CASE FOR DIRECTOR
PROFESSIONALISM
Add credibility and demonstrate accountability
15 APPROACH 2020 BOTTOMS UP!
Lead as if you were following
18 BE YOUR BEST!
Boldness in the boardroom
20 IDENTIFYING MANAGERS WITH
STAYING POWER
Four critical qualities of leadership
24 IN MEMORY OF ANTHONY DIXON
1946-2019
28 THE ROLE OF THE BOARD IN
SETTING STRATEGY
Exploring the practical challenges
31 FACULTY FAQ
Motivating de-motivated board members
40 MEMBER ACHIEVEMENTS
Celebrating excellence
44 REPORT BACK
Can you spot any familiar faces?
51 EVENTS CALENDAR
Plan your 2020 Director Development
52 MEMBER BENEFITS
Make the most of your investment
54 IN SHORT
Advice on health and wellness, tech reviews and book reviews
From the CEO
2
A YEAR OF E
LEADERSHIP
2 Directorship Magazine
There’s never been a better
(or more challenging) time
to be a member of a board.
Make it your resolution to
lead from the front and
play your part in getting
your organisation, and the
country, back on track.
W
e’ve all been guilty of making excessive New Year’s As directors, we have the
resolutions, only to have our good intentions wither in opportunity – and privilege –
the cold light of dawn. of providing that leadership
Meaningful and realistic resolutions, however, can within our organisations and
be a powerful motivating factor that sets the strategic framework for a contributing to the necessary
successful and productive year. change in our corporate culture.
We all return to work aware of the huge challenges that face our King IV cogently argues for
country and thus our organisations. leadership that is both ethical
Poor leadership got us into a situation. Good leadership is the only and effective. I like to think of
way out of it. this as E2 leadership. King IV
Directorship Magazine 3
From the CEO
places this leadership at the centre
of everything: it is embodied in
its first, foundational principle
“The governing body should lead
ethically and effectively.”
To bring E2 leadership to
life, one must first understand
“Practically, exactly what it entails. King IV’s
ICRAFT principles provide an
excellent guide to the underlying
create a
characteristics of such leadership.
It’s important to note that
board members should display
good work/life
these principles individually and
collectively.
balance and
The King IV ICRAFT principles are:
INTEGRITY.
take time to
At base, this means that directors
must suspend their instincts to
act in their own self-interest and
instead act in the interests of the
recharge.” organisation.
King IV’s recommended
practices make it clear that mere
legality is not enough: the bar is
higher. “I wasn’t breaking the law”
is a poor excuse.
The real litmus test is whether
a director’s actions or decisions
were taken to further the
organisation and the interests of
its stakeholders.
In line with the frequently cited
proverb that the fish rots from the
head, King makes it clear that the
board is responsible for setting an
ethical organisational culture.
4 Directorship Magazine
COMPETENCE.
This principle is frequently overlooked but critical: a director who has At the most basic level,
integrity and the best intentions but lacks the necessary skills is arguably following these principles is the
as destructive as a dishonest, self-serving one. The IoDSA’s professional best way to ensure that you do
certifications – Chartered Director (SA)® and Certified Director® – were not suffer a drop in reputation or
developed to give directors and would-be directors a way of not only find yourself on the wrong side
obtaining the skills they need but also keeping those skills up to date. of the law.
More positively, it’s worth
writing out both your end goal
RESPONSIBILITY. as a leader and the reason for
Directors should act in a responsible manner and take collective your involvement with your
responsibility for performing their functions. The former speaks to the need particular organisation: putting
to strike a balance between risk and opportunity in a responsible manner. pen to paper provides you with
a constant reminder of why you
are doing what you are doing.
ACCOUNTABILITY. Practically, create a good
Directors should always remain accountable for how their work/life balance and take
responsibilities are fulfilled. This is applicable even where such time to recharge your batteries;
responsibilities are delegated to another. otherwise you will not be able to
keep up the pace. Many people
attest to the value of a mentor or
FAIRNESS. coach – somebody to help you
Directors should consider not only the organisation’s interests but improve and support you.
also those of all its stakeholders. This principle also requires directors Finally, never forget that no
to consider the impact of their decisions on the natural environment, leader operates in a vacuum: it’s
society, and future generations. vital that you bring the rest of the
organisation along with you.
E2, in particular, may be
TRANSPARENCY. a novel concept to many
There is huge, global emphasis on transparency, as it is essential that members of the organisation:
leaders’ actions be scrutinised. Directors must fulfil their governance show the link between ethical
roles and responsibilities in a way that demonstrates how they arrived behaviour and effectiveness
at their conclusions. This builds trust and helps prevent even the and let members see it in action
appearance of improper conduct. in the board’s operation.
Members of governing bodies have an important role to play, but it By Parmi Natesan, CD(SA)®
should be acknowledged that they are facing a marathon rather than CA(SA), CEO: IoDSA
a sprint. In conclusion, then, I’d like to offer some tips for remaining
motivated.
Directorship Magazine 5
DOING
THE RIGHT
THING
6 Directorship Magazine
B
y any measure, Cynthia Stimpel was a successful career
CYNTHIA STIMPEL woman. After years in banking, she joined South African
paid a heavy price Airways (SAA) and ultimately became Group Treasurer.
for standing up In July 2016, however, SAA’s then-CFO, Phumeza Nhantsi
summarily suspended Ms Stimpel for her temerity in making public
against corruption her disquiet over a suspect tender at the embattled organisation.
at SAA. Now she’s
become a whistle- What went
blowing activist.
wrong?
And why?
The cause of the trouble was a tender to consolidate SAA’s extensive
loan book. As Group treasurer, Ms Stimpel had been working closely
on the complex funding structures that enabled the company to
operate. She had set up its borrowing plan and then motivated for the
consolidation of the company’s loans.
“We had many different loans of different durations and terms,
which were simply being rolled over. It made sense to consolidate
them into a single loan to reduce interest and administration; and
thus save SAA money,” she explains.
She took the idea to market and there was a definite appetite for
it – unsurprisingly, since it was a R15 billion deal.
The first sign of trouble was when the board indicated that it
wanted to be involved in the process and nominate companies to
respond. Ms Stimpel felt it inappropriate for the board to get involved
Directorship Magazine 7
Cynthia Stimpel
“For many, the financial consequences
are devastating, to which one must also
add the physical and mental costs.”
8 Directorship Magazineblowers contacted me both to
offer and request support,” she
says.
Ms Stimpel says that she
survived by maintaining as
much of her normal daily
routine as possible; through the
wholehearted support of her
family; and through reliance on
her strong religious faith. Her
at this operational level. She took her concerns to Wolf Meyer, the highly experience also drove home
respected then-CFO, who confessed that he was also uncomfortable to her the need for ethical,
with the process. Mr Meyer subsequently resigned and Phumeza principled boards and she
Nhantsi was appointed in his place. obtained the IoDSA’s Cert.Dir®
There were many ins and out over the months, but the nub of it was certification. She now sits on
that the CFO and board had a clear agenda to hand the contract over to two boards.
preferred bidders. The CFO and the board effectively hijacked the tender Talking to her, it’s clear that
process and kept Ms Stimpel at bay by withholding information. The she is also motivated by a
ultimate contract awarded to BnP Capital was summarily expanded to strong desire to provide support
include unnecessary transactional advice at a fee of some R250 million for current and future whistle-
even though the airline was teetering on the brink of financial disaster blowers. She’s collaborating with
In a last-ditch effort to prove that the contract as awarded to legal role-players to ensure that
BnP Capital was too expensive, Ms Stimpel obtained quotes from the PDA is enacted effectively to
three banks. But it was in vain. She was suspended some six weeks protect whistle-blowers’ jobs.
after the final awarding of the contract and spent the next year in She also helped form a
limbo. Ultimately, following legal advice, Ms Stimpel opted for early support group for whistle-blowers
retirement “in order to get my life back”. She testified before the Zondo and is working with organisations
Commission in June 2019. like Corruption Watch and The
Ethics Institute to find ways of
Recovering providing financial support to
those who lose their jobs.
from the Despite everything, Ms
Stimpel says she would do it
wounds all again. “My personal values
and commitment to integrity
Most whistle-blowers struggle to deal with the aftermath once are non-negotiable – but I didn’t
the adrenalin has receded and the realities of their new, changed get the protection I should have
circumstances become apparent. Like Ms Stimpel, most lose their jobs received,” she says. “My goal
despite the provisions of the Protection of Disclosures Act (PDA) (26 now is to ensure that future
of 2000). This sudden loss of security can be extremely daunting. For whistle-blowers do receive
many, the financial consequences are devastating, to which one must adequate protection, and that
also add the physical and mental costs. they don’t have to suffer for
In Ms Stimpel’s case, as in those of most others, there was a distinct doing the right thing.”
lack of support from (former) colleagues – who perhaps feared for their
own jobs. “Once the news about my case broke, though, other whistle- By James van den Heever
Directorship Magazine 9THE
CASE
FOR DIRECTOR
PROFESSIONALISM
Creating a pool
of professional,
appropriately skilled
directors is essential
to get the economy –
and your career – on
a growth track.
10 Directorship MagazineI
t’s a simple, yet important, question: “Why should directors are indispensable in others;
professionalise?” Although this question is multi-faceted, the particularly where the stakes are
overriding factor is that professionalisation means you learn a high. Audit is a good example:
lot about ethics, conduct, and probity – and no South African the formal qualification of
needs convincing of how important these are. Of equal import, your a BCom or similar degree is
professional designation is a guarantee that you possess a consistent important, but the CA(SA)
set of relevant skills that are backed up by experience, and that you designation shows that the
are, therefore, in a position to make sound, informed decisions. individual is not only bound
Let’s go into more detail on why you should professionalise by a certain code of conduct
and how to go about it. Although it’s entirely possible to succeed but also has the required real-
without professional designations in some areas of work, they world, practical skills and
Directorship Magazine 11Director professionalism
experience. A professional designation also implies the undertaking
to keep the relevant skills current through continuous professional
development. The combination of personal attributes, skills, and
experience are what make a professional.
Yet there are no regulatory requirements that a person taking up
a directorship position must fulfil. The exception being directors of The IoDSA
companies listed on the Johannesburg Alternate Exchange – they
must complete a minimum four-day course.This might sound like is not a
police-man:
an “easy out”, but directors who take their responsibilities seriously
appreciate that they are stewards entrusted with looking after the
affairs of a business and thus bear a weighty responsibility. Instinct,
gut feel, experience, and existing knowledge are all essential factors we are a
that contribute to effective directorship, but they are not enough.
A director must also be able to demonstrate that their decisions
professional
were the result of an informed process and supported by a set of
sound governance principles and are always to the benefit of the
body
organisation they’re serving.
Going the extra mile to achieve a professional director
tasked with
designation is of the same significance as achieving other top
designations. It’s a testament to not only your commitment to your
promoting
profession but also your knowledge, skills, and attributes.Just as and safe-
you set store by the CA(SA) of your accountant, a Certified Director®
or Chartered Director (SA)® designation carries weight. It adds to guarding
the highest
your credibility and demonstrates accountability to a higher code
of conduct. This gives clients and employers a sense of comfort
that you will act appropriately and with due skill and care in all
circumstances. standards of
ethics and
What you can conduct.
expect to learn
Being a director requires a diverse skill and knowledge set. These
are horizontal (applicable to any industry) and vertical (applicable
to a specific field of commerce or endeavour). Typically, you’ll have
a wealth of vertical knowledge, which likely played a role in your
obtaining the position as director in the first place.
Formal professional director training is targeted at horizontal
knowledge. It’s broadly focused on the principles of King IV™,
12 Directorship Magazinewhich include ethical and conduct principles. King IV also provides the knowledge that flows from it
technical know-how to be an effective director. Qualifying as a Certified is a valuable addition to the
Director or Chartered Director (SA) with the IoDSA means that you are
® ®
practical skills of operating a
bound by our Code of Conduct, which rests on the principles of ethics business. The next obvious
and conduct taught in our professional director courses. question is then “What’s
Those with an interest in philosophy recognise that ethics is a the difference between
challenging field. Peoples and cultures have their own, distinct ethical the Certified Director® and
frameworks. Nevertheless, there is common ground and that’s what Chartered Director (SA)®
the IoDSA training focuses on. The professional director’s Code of designations?”
Conduct outlines six principles that provide a reference for values-based A Certified Director®
decision-making and conduct. designation is recognition
These principles should be your basis for ethical and effective that you have the knowledge
conduct in the day-to-day fulfilment of your roles and responsibilities. and understanding of what it
Your ethical position influences, or guides, your conduct: the Code’s means to be a director. Adding
conduct principles provide a reference point for conduct towards the “Cert.Dir®” to your business
company you serve as a director; the profession; and the IoDSA itself. card requires the completion
The IoDSA also requires professional directors to acquire the of a set of seven training
necessary skills to comply with the Director Competency Framework™, programmes and passing an
which consists of 16 functional competencies, two personal exam on the content of these
competencies, and two social competencies. The Framework is used programmes.
in the evaluation of both the Chartered Director (SA) and Certified
®
Typically, candidates take
Director designations. It is the foundation of the curriculum offered in
®
between six months and a year
the IoDSA training programmes. The Framework is fully aligned with, to qualify. This is dependent
and supports, the principles outlined in the King IV Report on Corporate on the candidate’s calendar,
Governance™. as training programmes are to
The IoDSA is not a policeman: we are a professional body tasked be completed on scheduled
with promoting and safeguarding the highest standards of ethics dates. The Chartered Director
and conduct. Thus, as a professional director, you are expected to (SA)® designation recognises
uphold these standards (on which we provide training on the path to your mastery of directorship,
professionalism). It also means the IoDSA can act against members which includes knowledge,
who transgress these standards by instituting disciplinary action and skills, and personal attributes.
imposing sanctions against those found guilty of transgression. Achieving the CD(SA)®
designation requires at least
Certified or three years’ directorship
experience serving on
Chartered? the governing body of an
organisation that is evaluated
Most directors appreciate the value of professionalism, as it makes for governance substance.
good sense. Furthermore, the combination of formal training and the Evaluation for the designation
Directorship Magazine 13Director professionalism
includes the submission of a Portfolio of Evidence, writing an exam,
and participating in a peer interview.
Earning the CD(SA)® designation typically takes between six and
eight months.
Maintaining either designation requires membership of the
IoDSA and the completion of 30 Continuous Professional Develop-
ment hours per annum.
Be professional
– start today
Professionalism delivers valuable advantages. It not only
demonstrates your qualifications but also provides you with
the knowledge to act well in every
situation. To learn more or start your
journey to professionalism, visit
www.iodsa.co.za or contact
certification@iodsa.co.za.
By Sherma Malan, CFP®,
Executive: Certification and
Member Services, IoDSA
14 Directorship MagazineAPPROACH
2020
BOTTOMS
UP!
Make the resolution to change your leadership
approach this year. The bottom-up leadership
approach can make your business more
successful and empower your employees.
W
e’ve all heard the question, “What’s your New Year’s
resolution?” We make resolutions in our personal lives
and careers, and to achieve targets in our businesses.
Yet, have you thought of a resolution on leadership that
makes your life easier at work and your business more successful?
If you haven’t, don’t worry! You are NOT alone. If this is of interest to
you, I strongly recommend that you read further to understand bottom-
up leadership and how it could make your life easier at work and your
business more successful.
Directorship Magazine 152020 Approach
What is bottom-up
leadership?
Bottom-up leadership is very much a “green leadership” approach.
It’s about thinking differently and being a pioneer among executives:
someone who promotes a better way of thinking and doing. Bottom-up
leaders follow a principle of “lead as if you were following” to contribute
to the career journey of the individual. As such, leaders don’t take charge
of the situation.
They allow employees to initiate, ignite, and drive with the objective
of steering them on the correct path. As an EQ factor, influence
(from both the leader and employee) is a determinant of bottom-up
leadership’s success. The influential capacity and capability of both
individuals are critical to making a new business idea, product, or “Holding on
to a traditional
process (or anything else) a success. Why should you implement
bottom-up leadership?
Ever asked yourself, “What is the most valuable asset in my
business?” Often, the answer is, “My employees.” Bottom-up leadership leadership
follows this principle: every individual is equal, and in today’s
challenging, continuously changing work climate every employee needs
approach
to think strategically and be commercially savvy – both for business and
in their personal capacity.
will result in
THERE ARE THREE FACTORS TO CONSIDER WHEN IMPLEMENTING
employee
BOTTOM-UP LEADERSHIP:
frustration and
1. Decentralisation will essentially
Decentralised environments call for the delivery of a centralised
goal and vision. For this to work, employees must be empowered to be counter-
productive”
operate independently, with the decision-making freedom to deliver the
organisation’s consolidated goal and vision.
Holding onto a traditional leadership approach will result in employee
frustration and will essentially be counterproductive to the objectives
and goals of your organisation.
2. Innovation
Allowing employees to run with their roles and responsibilities creates
opportunity for innovation. Essentially, employees are accountable
for their actions: they are entrusted to do the right thing, but they have
16 Directorship Magazinesomeone to fall back onto if needed. Enabling this emergent thinking
and entrepreneurial behaviour creates agility.
By allowing all levels of employees to participate, unity is created.
This builds morale and productivity: two key elements related to
successful innovation.
If you are dependent on innovation, all employees need to show
leadership, as innovation is ultimately driven bottom-up and not top-
down.
To drive this, we as leaders need our employees’ buy-in. Our
employees must create new ideas – they must think and not only do.
Ronald Reagan, the 40th president of the United States, summarised the
above very well. He stated, “The greatest leader is not necessarily the
one who does the greatest things. He is the one that gets the people to
do the greatest things.”
3. Influence and Trust
Enabling employees to run on their own, with the objective of self-
reflection, encourages them to improve their capabilities, which
ultimately creates an adaptive learning environment.
Empowering employees at all levels to have unique insights into
your organisation’s goals and objectives (not only its problems), allows
for the internal sharing of solutions, which can ultimately improve
productivity.
To do this, you must influence thinking differently. Imagine yourself a
teacher who views all their students as “A” candidates: capable of taking
on new challenges with guidance, whilst being pushed beyond their
comfort zone.
The 70-20-10 learning and development model provides factual
evidence that 70% of learning occurs through new and unfamiliar
activities, 20% occurs through mentorship, and 10% through training.
In conclusion, leadership is not a one-size-fits-all strategy. What works
for one may not work for another. It is, however, essential to experiment
and try instead of locking down into traditional approaches.
The New York Times, Ernest & Young, and IBM apply the bottom-up
leadership approach in their businesses, and with it has come success.
The question to ask yourself is, “Am I ready to let go of controlling my
employees and rather guide them?”
By Hiten Keshave M.Inst.D., Chief Executive Officer: Khumovest
Directorship Magazine 17NT COVERS
F
cution
be your best!
be bold in the boardroom
ellow directors, when you arrive in the boardroom for a
meeting, do you consider how you could guide and direct
ions the organisation to not only make a difference but also
positively influence lives in the greater interest of the
organisation and our country? How do you remind yourself of why
you are in this role? What value do you add to this position and to
the organisation? What is your contribution to making the board
and management more effective? How do you make the board and
management’s work lives easier, simpler, and more pleasant so
that they are engaged, involved, and enthusiastic about their work?
So, when you show up at the boardroom, what are you bringing
and doing to help you, your fellow board members, management,
the organisation, and the country be a more successful, happier,
and more joyful place in which to work and live?
Talking is good, but it must translate into positive action towards
a common goal. It’s up to you to make the difference and do your
part. No extent of power, money, or leadership change can bring
about sustainable change unless you realise that your organisation’s
destiny and future lies in your hands. Despite all the disruption,
challenges, negativity, and constraints we face daily, it is within your
power to show up, be present, and bring your best to your role every
time.
Most of us are unaware that we have the power within us to
create choices and be courageous enough to make bold decisions
to be better, to be healthier, and to improve our lives every day if we
chose to. You are a gift to this world. Bring that gift to everything
you do, whether it’s your work or your life.
All of us are leaders in our own right and natural way when we
take personal accountability in our roles as parents, guardians,
You have within elders, teachers, helpers, executives, managers, advisors,
you the power to professionals or directors. Yet we undervalue ourselves, because
we choose to do so by giving our power away.
make choices and What if you chose to find meaning in your role? What if you
influence not only chose to create opportunities to learn, grow, and apply your
knowledge, experience, and skills where they are needed most?
your organisation What if you chose to be the “master” of your role and you were
but also our nation. seen, heard, and wanted by your peers? What if you chose to build
healthy relationships with your shareholders, board members, and
management to achieve your goals?
Imagine what your organisation would look and feel like if we all
chose to show up and be present every day and to do our very best,
and if we cared enough. This is in our interest, our families’ interest,
our organisations’ interest and our country’s interest.
By Nandha Govender, Cert.Dir®,
Master Coach and Trainer: InnerLifeSkills®
18 Directorship MagazineLEADER CORPORATE
SERVICES SERVICES
CORPORATE
SERVICES
BETTER DIRECTORS.
BETTER BOARDS.
BETTER BUSINESS.
BETTER DIRECTORS.
www.iodsa.co.za
BETTER BOARDS.
BETTER BUSINESS.
www.iodsa.co.za
BETTER DIRECTORS.
BETTER BOARDS.
BETTER BUSINESS.
www.iodsa.co.za
www.iodsa. co.za
Achieve the gold standard in Director Certification © 2019 EHP
IoDSA Chartered Directors® represent the highest standards of professionalism,
competence and ethics in the directorship profession.
Are you the next Chartered Director (SA)®?
Next intake: May 2020
Visit the Certification page for more information on (https://www.iodsa.co.za/page/CDSA_pg)
CDSA Ad.indd 1 2020/01/21 13:49:26IDENTIFYING
MANAG
WITH
STAYING
POWER
20 Directorship MagazineERS Although we are attracted
to stereotypical leaders with
certain personalities, there
is more to leadership than
meets the eye. The four critical
qualities that a leader needs
to survive in any industry
are adaptability, reliability,
the ability to make and own
difficult decisions, and the
ability to engage stakeholders.
B
oards of directors often
gravitate towards extroverts:
the popular guy who plays
golf at the weekend and
loudly cheers in the pub when the
Boks win the match. He’s easy to talk
to. He holds your shoulders while he
listens to your complaint and tells you
that he’ll sort it out in the morning.
There is also the stereotype that
good managers, let’s call them leaders,
are charismatic, six-foot tall men. They
are often qualified in either law or
Directorship Magazine 21Managers with staying power
accounting, have a great can-do attitude, and have some experience in Engaging
the industry. However, history has shown that we should not be fooled
into thinking that an extroverted personality is, in most part, required to for
make a good leader.
According to the Fortune 500 Conference Board, over 25% of
impact
CEO departures between 2000 and 2003 were involuntary. This Once the leader has set a
occurred in most industries. Clearly, many capable leaders and clear course, engagement with
boards of directors don’t get it right and, in many instances, top stakeholders ensures that
performers leave due to conflicting visions, ideas, or approaches to decisions are implemented, and
management. that board and management
buy-in is obtained for the
Decision-making stipulated course of action.
No leader can do all things
with speed and be all things. Buy-in from
all stakeholders is critical: the
and conviction board must support the leader
to streamline the team. This is
Good leaders don’t always make the best decisions. But they do not particularly important if there is
hesitate to act when required. internal revolt grounded in past
Mistakes will be made, and adjustments may be necessary, but loyalty, resistance to change, or
good leaders take responsibility for their mistakes and make early, fast, clinging to “how we’ve always
decisive decisions. done it”. In the end though, the
They are quick to review their decisions and adjust direction when leader must hold firm and stay
required: they keep the company moving forward. the course.
This is an important characteristic as it builds momentum and In terms of the Companies
causes change to become an automatic occurrence as the business Act (71 of 2008), the majority
is literally propelled into a future of possibilities. rules: a board is elected, and it
Slow decision-making creates bottlenecks. An average leader must act. The company cannot
deals with accounting, law, politics, facility maintenance, governance, be governed by everyone who
environmental issues, and human resources (among others). If one owns a share in it. This also
bottleneck is created for each of the 20+ portfolios on the leader’s connects to the first point –
desk, the company will slowly come to a grinding halt. making decisions with speed
Great leaders understand that a wrong decision is sometimes and conviction. Can you imagine
better than no decision, as long as the leader regularly monitors how long decision-making,
progress and redirects the ship as needed. At all costs, the leader must implementation, or taking action
avoid the ship being stranded on a sandbank as others steam past. If would take if we had to consider
that occurs, other companies will keep growing, while your indecision all shareholder views on every
brings yours to a halt. topic?
Understanding that perfect information is only available after the It’s important for a successful
fact leads to a broader vision and approach, which in turn leads to leader to accept that acting and
a balanced strategy that can brace for a crisis and carry company handling clashing viewpoints
demands. go hand in hand. The key is
22 Directorship Magazinemastering how to handle alternative approaches; knowing when to stakeholders. Leaders must be
acknowledge different perspectives; and (at times) accepting that realistic, even when shareholders
these viewpoints might never be aligned. are shouting for a major project
At other times, change will be needed. When this happens, the to be developed or implemented.
leader must be brave enough to admit it and take action. If it cannot be achieved, or
A leader who is engaged for impact is not an autocrat. A leader achieved within the desired
who is engaged for impact is decisive, informed, and dedicated. timeframe, the leader must
It is no surprise that the average term for a top performing CEO is have the courage to engage for
frequent, lucrative stints of two-three years each (according to the impact and stay with the plan.
latest Fortune 500 research). This will not always be popular,
but repeatable and reliable
Adapting results that meet timelines will
earn trust and understanding.
proactively The delivery of consistently
reliable results shows planning
Most leaders know it’s crucial to divide their attention between short-, and organisational skills.
medium-, and long-term perspectives. The adaptable leader spends Dashboards; metrics; the
up to 50% of their time thinking about the long-term and the bigger accountability of teams; and
picture. channels for clear feedback are
Doing so helps these leaders to not only notice early signals but the hidden skills of consistency.
also adapt the course of the company as required. Such leaders In conclusion, adaptability,
realise when the political and economic atmosphere reaches a reliability, and the ability to make
point at which they should change their approach or exit the market. and own difficult decisions while
Noticing such changes and taking decisive action helps them steer engaging with stakeholders are
into clear water and gives them time to reflect and readjust the plan critical leadership skills. It is
before others even know there is a decision to be made. thus crucial that boards ignore
Part and parcel of adapting proactively is acknowledging that the sideshow of a likeable
setbacks will happen. A strong growth mindset is a key trait of a good personality and step away from
leader. the stereotype to focus on the
traits that will give a candidate a
Delivering fair chance at success.
reliably By Francois Schoeman, Cert.Dir®,
COO: GEMS Property
It may sound mundane, but the ability to consistently deliver results,
big or small, is probably the biggest required skill of a good leader.
Boards and shareholders love steady leadership, and employees trust
predictable action that stays within the provided plan.
The key to delivering reliably lies in setting and communicating
realistic expectations. If you believe you can change the company
in one year, announce it! If not, rather stick to smaller victories
that will lead to long-term gains and consistently earn the trust of
Directorship Magazine 23IN MEMORY OF
ANTHONY
(TONY)
DIXON
10 November 1946 to
18 December 2019
IoDSA CEO: 2004-2007
IoDSA Facilitator: 2008-2015
King Committee Member: 2003-2013
I
t is with sadness that we pay implemented a long-term growth strategy: set at the time to raise the
tribute to Tony Dixon, who organisation’s profile, post the King II report, and put the IoDSA on more
has played a pivotal role in sustainable footing. Under his influence the IoDSA not only became a
the early development of leader in the field of director development but also started its journey into
the IoDSA and helped paved the corporate services (with the introduction of board appraisals). Tony was a
way towards the institution you constant beacon and promoter of the IoDSA. His contribution and impact
know today. Tony successfully will never be forgotten, and he shall remain a part of the IoDSA legacy.
24 Directorship Magazine“Tony’s
strength
was
motivating
those he
worked
with
h and to
think ‘out
‘out
the box’.”
box’.”
“Tony Dixon made an invaluable contribution to governance and
directorship in SA as former CEO of the IoDSA. Particularly close to
my heart, is the memory of his early days as a facilitator, when he first
introduced board evaluation services in 2008 – a thriving area of our
business today.”
Parmi Natesan (Current IoDSA CEO)
Directorship Magazine 25In Memory of Anthony Dixon
“Tony had the habit of making
“Tony took over as the first Chief Executive Officer of the IoDSA up nicknames for those he met.
from an Executive Director in 2003. The council gave him two His initials were ADD and mine
main performance objectives. Firstly, to grow a diversified IoDSA MDD, so that’s how we addressed
from 1 500 primarily white members to double that number each other. Tony’s strength was
in three years with emphasis on black and female members. motivating those he worked with
Secondly, to develop IoDSA relations with neighbouring and to think ‘out the box’.
countries to become a regional professional institute of When Al Gore produced his
reference. Tony excelled in achieving these, as manifested in: film An Inconvenient Truth, both
/ Membership that grew in leaps and bounds with a diversified Tony and I were impressed with
racial and gender profile, which included the establishment of the message to focus on global
offices in Durban, Cape Town, and the Eastern Cape; warming. We in fact tried to
/ The launch of the IoDSA training function that became the arrange for Al Gore to come to
mainstay revenue stream; The forging of relations with South Africa through the auspices
business bodies in neighbouring states, which gave the of the IoDSA to promote the
IoDSA stature in Southern Africa; movie, but sadly the exercise
/ Moving from a two-office back room to large offices in proved a little too expensive and
Parktown with a growing diversified staff complement; and we had to cancel it.There is no
/ The transformation of the IoDSA council/board from pale doubt that Tony’s efforts and
male to a vibrant, diversified one. strong ethics at the IoDSA will be
Tony left profound marks on the tapestry of the IoDSA, may his remembered. It was a shock to
soul rest in peace.” lose an old friend so suddenly and
Shepherd Shonhiwa (Former IoD Council Chair, part of the at a relatively young age.”
nominations committee that selected and appointed Tony) Malcolm Dunn (IoD Council Chair
during Tony’s tenure)
“There was never a dull moment when Tony was around: he had a
“Tony Dixon was a marvel to
wonderful sense of humour. He always encouraged us to be the best
work with. He was free-spirited,
of who we are and excel in what we do. He was a great CEO. May
a motivator, a leader, and always
your soul rest in peace, mkhulu.”
had a sense of humour. It was
Octavia Lengoati (IoDSA Events and Facilities Coordinator)
an absolute joy to be around
him – you could never feel lost
“Tony was a stalwart and a or confused in his presence. I
definitely learned a lot from him.”
person on whom I, as chair, Johannes Sangweni
(IoDSA Office Production Clerk)
could always rely. He was a
“I knew Tony for 16 years and will
person of the utmost integrity.” always remember him fondly as a
Mervyn King (former chairman of the King Committee on Corporate man who brought out the best in
Governance) people. He was kind and generous
to a fault, a true gentleman! He
“When I think of Tony, I think of a leader, a professional, and a friend will be greatly missed for his
with a big smile and big heart. Thank you for the positive impact you knowledge and friendship.”
had on me and others. We will miss you dearly.” Fiona Trevethan
Vasili Yatracos (IoDSA Corporate Services Manager) (IoDSA KZN Member Liasion)WHY CHOOSE THE IODSA AS YOUR
BOARD PERFORMANCE EVALUATION
SERVICE PROVIDER?
Non-profit company Board evaluation experience
• BBBEE Level 2 • Leading best practice evaluation
• Profit is not distributed but questionnaires
re-invested into the business to promote • 10 years of experience
and improve corporate governance and • Over 280 appraisals conducted
directorship in SA • Benchmarking ability against sector
World class faculty Brand you can trust
• Our facilitators are currently serving • 60 year old brand
directors • Publication and ownership of each King
• Collectively our faculty has over 350 Report on Corporate Governance®
years of practical boardroom • Leading industry experts and specialist
experience service provider
• Various sector experience • African and International Corporate
Governance affiliations
We offer a variety of board performance evaluation options to meet your
specific needs and budget:
PACKAGE Option 1 Option 2 Option 3 Option 4 Additional
evaluations
Quantitative Online include:
Questionnaire
• Board
Qualitative All members All members Limited Committees
Interviews 5 Interviews • Individual
Without Director (peer)
Evaluation Report quantitative • Company
scoring
Secretary
Presentation • Chairman
of Results • Action plan
workshops to
Estimate Cost Starting from Starting from Starting from Starting from
Excl. VAT R110 000 R99 000 R88 000 R60 000 address gaps
These options show possible ways to structure your evaluation and can be customised to your needs.
Note: Organisations with an active IoDSA Corporate Board Membership receive a 15% discount on fees, and
non-profit entities receive a standard 20% discount.
www.iodsa. co.za
For more information or to request a proposal contact
corporateservices@iodsa.co.za or dial 011 035 3000THE ROLE OF THE BOARD IN SETTING STRAT 28 Directorship Magazine
ATEGY
Whether it’s due to a lack of knowledge, a lack of time, or a misalignment
of views, the board is not always as involved in setting strategy as
is required. As the growth and development of our organisations are
dependent on our active participation, let’s fully embrace this role.
Directorship Magazine 29The board and setting strategy
K
ing III™ clearly outlines that the board should play a prominent This can be due to several
role in the strategy development process and not be the mere factors:
recipient of strategy as proposed by management. Principle • Board members may not be
2.2 highlights that “The board should appreciate that strategy, fully knowledgeable about
risk, performance and sustainability are inseparable.” The theme is further the organisation’s founding
developed in King IV™, which states the board’s foremost governance purpose. The board is thus
role and responsibility: the board “Steers and sets strategic direction with unable to use it as the
regards to (i) the organisation’s strategy and (ii) the way in which specific beacon that guides strategy;
governance areas are to be approached, addressed and conducted.” • Limited knowledge of the
organisation’s business
The King reports operations may prevent board
members’ full participation in
cumulatively guide strategy formulation;
the role of the board • Non-executive board
members may not have time
in strategy as: to devote to the full chain of
• Identifying the organisation’s key performance indicators, value strategy development; and
drivers, risk matrices, and measures to be used. Management and • Members of management
the board must agree on these aspects; may believe that they
• Establishing the purpose of the organisation as designed by its understand the detail of the
shareholders and investors; business to such an extent
• Steering strategy to ensure value creation in terms of the triple that they find it expedient to
bottom line of the social, economic, and environmental performance develop the strategy in detail
of the organisation; then summarise and briefly
• Ensuring the alignment of the strategy to the organisational purpose, present it to the board for
business value driv ers, and interests and expectations of its endorsement.
stakeholders; and
• Approving short- and long-term strategies and continuously The chairman of the board must
monitoring management’s implementation of those strategies. not only continually encourage
board members to understand
There are a number of practical challenges that emerge when one and own the business strategy
considers the board’s role in setting strategy. but also ensure that management
At the coalface, the roles of the board and management in strategy incorporates a strategy
formulation are not always as seamless and complementary as desired. implementation tracker into the
In some situations, destructive differences occur due to the vocabulary of the organisation’s
misalignment of views, while in others one party may be overly regular reporting on its triple
dominant, which results in either strategic paralysis or a one-perspective, bottom line results.
unbalanced strategy. By Shepherd Shonhiwa, CD(SA)®
The board does not
always play its full
role in strategy
effectively.
30 Directorship MagazineASK THE EXPERTS:
FACULTY FAQ
Q
How do you
motivate and/or
re-energise board
members who
have become
complacent in their
preparation for
board meetings?
Directorship Magazine 31Faculty FAQ
When it comes to motivating and re-energising directors regarding
preparation, I’ve seen several options in practice. One chair would
ask different NEDs to take the board through their perspectives of the
submission at hand. This had the effect of all directors preparing diligently
so as not to be embarrassed.
In practice, most chairs seem to prefer having a private meeting with
Sikkie Kajee, CD(SA)® individual directors to discuss the issue and counsel NEDs to prepare and
perform.
A left-field option would be to consider discussing case studies of
governance complacency – recent examples include African Bank, Steinhoff,
Tongaat-Hulett, and Old Mutual. This could have the desired outcome, as
directors would better understand how their complacency could come back
to bite them.
It is important to keep non-executive directors (NEDs) engaged, so that
the board and company can fully benefit from their talents, passions, and
ambassador roles. In my experience, the following actions are helpful in
preventing board members from stagnating and re-energising them.
The chair should lead by example. The chair’s position, enthusiasm, positive
attitude, and meticulous preparation should motivate NEDs and restore their
Prieur du Plessis, CD(SA)® energy.
• The chair should personalise a relationship with each board member,
and their accomplishments should be announced and celebrated.
• The chair should involve “dead-weight” NEDs by tasking them with
roles, such as to introduce specific agenda items. This should stimulate
engagement.
• Better meetings, with a clear purpose, could provide motivation to
the board. Meetings should be structured properly (to avoid being
tedious) and include short breaks to refresh and renew attention spans.
Throughout the meeting, the chair should canvass input from each NED.
• Serving as a NED is sometimes perceived as a somewhat thankless
task. It is therefore important that the chair make the board as visible as
possible to the organisation and its stakeholders.
• Board assessments are useful tools to not only identify stagnating or
underperforming NEDs but also create an opportunity for personal
32 Directorship MagazineThe chairperson is key to motivating and re-energising board members.
The chairperson of the governing body must take the lead to ensure board
members’ constant, thorough, and effective preparation for board meetings.
It’s important to lead by example: the chairperson themselves must thus be
exemplary in their preparation.
The structure of board meetings can greatly contribute to cultivating
Joe Lesejane, CD(SA)® a culture of preparation among board members. A board meeting should
start with a summary of the priority agenda items. This helps the meeting
remain focussed. Each agenda stage must be introduced by an overview
of the item, after which the relevant presenter puts forth only its key
aspects. This emphasises the assumption that board members are always
thoroughly prepared. The meeting must never be used for preparation and
the chairperson must regulate this strictly.
The chairperson must encourage a culture where board members raise
critical questions (on matters of clarity) long before the board meeting.
These questions can either be answered beforehand (with responses sent
to all board members to avoid possible repetition of the same queries) or
responses can be facilitated at the board meeting itself.
The chairperson should also consider aiming specific questions at
individual board members, on the assumption that they are thoroughly
prepared. Such questions should take the board member out of their
comfort zone, for example a human resources question posed to a member
with an engineering background. This approach is targeted at those board
members who do not contribute in meetings or are very quiet. It is aimed at
keeping your board members on their toes.
Board meetings should close with the chairperson specifically
commenting on the effectiveness of the meeting, especially on the issue of
preparation. Finally, through the committee chairpersons, the chairperson
must also encourage the above approach at board committee meetings.
This approach is based on the assumption that the board packs are of
the right quality and are received on time.
While the chair role is to enable participation, it is, in my view, not the chair’s
job to motivate and energise. We are dealing with the upper echelons in
business and it is each NEDs responsibility to be prepared, energised, and
committed to the board and its functioning. The chair must handle the lack
of preparation directly with the individual director: if they don’t change, they
must be removed.
Ralph Patmore, CD(SA)® We are too accommodating when it comes to non-performing directors.
That is why we have the current stream of board problems surfacing. To
support the above, we also have the King requirement of “assessment” to
ensure that board members are functional both as a team and individually.
Directorship Magazine 33Faculty FAQ
The board of a company has an onerous task. It is there to steer the
organisation and determine its future direction. As such, directors (executive
and non-executive) set the tone for the organisation. When it comes to
motivating or re-energising directors the first step is to remind them of this.
If the board demands exceptional performance from the organisation and its
employees, then they must lead by example.
Thus, to motivate board members, it’s prudent to constantly educate
Marlon Moodley and remind them that the organisation looks to them to set an appropriate
example. Directors should also bear in mind that we live in a world of
increasing transparency. People watch what you do and benchmark it
against what you say, and hypocritical behaviour is called out quickly.
As motivation is, by its nature, a behavioural matter, the chairperson must
emphasise and seek appropriate behaviour from the board regarding their
preparedness for meetings.
Finally, and most importantly, boards are there to serve stakeholders.
Poor preparation (or a lack of preparation) is a disservice to the organisation
and ultimately deprives all stakeholders of a potentially promising and
sustainable future. Board members must be mature enough to understand
this responsibility and act accordingly.
The chair is responsible for leading the governing body. According to
Stephen Spencer & Associates:
“It’s a well-worn, yet no less appropriate, analogy that as a Leader, you are
like the conductor of an orchestra, ensuring that all the players (a) are on
the same page, (b) come in at the right time, playing the right notes, and (c)
Richard Foster, CD(SA)® are able to give their very best performance, every time. To quote Benjamin
Zander, conductor of The Boston Philharmonic Orchestra and a celebrated
guest conductor around the world, you are “Chief Dispenser of Enthusiasm”.”
The tone should be set from the very top, by the chair, who shapes the
culture and related dynamics. Board evaluations are a valuable tool that
the chair could utilise at the outset of a meeting to provide guidance and
focus on these aspects. This is an opportunity to highlight concerns and the
chair’s expectations from both governing body members and management.
Board evaluations affords the chair the opportunity to address not only
sub-standard performance (or enhance performance) but also the attendant
effectiveness of the governing body.
The chair should emphasise that the governing body papers, which
inter alia provide context, should be read. This will allow members of the
governing body to be sufficiently prepared so that a suitably rigorous and
informed discussion can take place. Members of the governing body
34 Directorship Magazineshould show that they made an informed decision based on facts, in order
to meet one of the three requirements of the “Business Judgment Rule” in
demonstrating the discharge of their duty with due care, skill, and diligence.
A reminder from the chair of the directors’ duties and attendant liabilities
is also useful to sharpen the minds and focus of the various members.
Being a board member is a senior, extremely responsible position. A full and
proper induction is crucial to truly understanding the “Why, How and What”
of the business.
Why: What is the purpose of the business?
How: How do we do the “What”?
Barrie Jack, CD(SA)® What: What is it that we do?
Firstly, board members must attend all meetings. Secondly, they must
thoroughly prepare for such meetings by carefully reading board and committee
packs and interrogating them with the relevant executive, where necessary.
Decisions taken by boards of directors can significantly impact on all
stakeholders. Accordingly, board members need to be fully conversant with
their fiduciary responsibilities on the basic premise of consistent integrity and
ethical behaviour and, of course, always acting in the interests of the entity.
An essential quality is courage. The courage to speak up when a matter is
not fully understood and to stand firm when a decision under consideration is
contrary to the board member’s principles and ethical stance.
The task of motivating or re-energising board members can thus be
performed by ensuring that board members fully understand the business’s
“What, How and Why”; providing comprehensive preparation packs; and
ensuring that board members are heard and feel comfortable to express
contrary views.
When trying to re-energise board members and addressing their lack of
motivation to prepare for meetings, the chairman can take the following steps:
1. Determine the reason for the directors’ lethargy or lack of motivation.
1.1 Check that the content of the board pack is easy to read and that the
structure is as agreed on by the board. This should be reviewed every
two years for relevance.
Shepherd Shonhiwa, 1.2 Ensure that the board pack is distributed at least seven days prior
CD(SA)® to a board meeting. (Electronic packs are more user-friendly than paper
packs.)
2. Ensure that the board skill set is balanced and adequate to understand
the issues discussed.
Directorship Magazine 35Faculty FAQ
3. As chairman, ask lethargic board members in advance to lead the
discussion on particular agenda items, which forces them to read the
pack.
4. Discuss the lack of participation openly at the board meeting to
sensitise board members to it and get remedial input.
5. Ensure that management does not dominate the meeting with detailed
operational presentations.
6. The chairman must lead discussions to keep meetings interesting. Avoid
a monotonous agenda and sometimes change the venue for variety.
The chair should keep board members on their toes by constantly
challenging them to give their views on specific subjects. When a
contentious or important issue is due for discussion at a forthcoming board
meeting, the chair should make it known that the issue will be discussed
and that they will be seeking the opinion of each board member so that
consensus can be reached. The chair should emphasise that the board
Tim Anderson papers, which provide the necessary context, must be read so a well-
informed discussion can take place.
If the chair is concerned about a specific board member’s lack of
participation, the chair could nominate this person to open the discussion on
an issue at the next board meeting. Nominating individual board members
for specific tasks is a good way of keeping them involved. It’s also a good
test to check that board members still have the interest and enthusiasm to
continue in their role.
According to KING IV™ “The governing body is the structure that has
the primary accountability for the governance and performance of the
organisation.” This fundamentally important role is supported by close
collaboration between the organisations themselves and bodies, such as the
IoDSA, that have an interest in promoting good governance in South Africa.
The chair should ensure that the effectiveness of the board, the
committees, and individual board members is tested through regular self-
and facilitated evaluations. Appropriate steps should be taken to deal with
areas of non-performance. A summary of these processes and outcomes
should be included in the integrated report.
It is extremely important that the chairman of the board be a good leader.
This role includes ensuring that the full team performs well and is engaged
and prepared.
The chairman can demand that NEDs perform. It is each NED’s
responsibility to motivate themselves. The chairman should not have to do
this.
Hester Hickey Some of the actions I have seen a chairman take to ensure that board
36 Directorship MagazineYou can also read
