Magazine article New Zealand Management

The Director: How to Avoid the Director's "Use By" Date

Magazine article New Zealand Management

The Director: How to Avoid the Director's "Use By" Date

Article excerpt

Byline: Jens Mueller

My brother-in-law is fanatical about 'use by' dates on grocery store items. He would rather die of thirst than drink milk two days beyond its so-called expiry limit. A little extreme perhaps, especially when he then points out to the store manager which items should no longer be on the shelves. But then again, "used by" is supposed to provide some assurance of currency.

And currency is what troubles me when I look at the committed and engaged directors who run many of New Zealand companies. If not knowing what you don't know is a truism, then surely not knowing when you don't know enough must run a pretty close second.

We all have skills that were, we hope, at their peak at some point. But these can go stale if they're not constantly refreshed, benchmarked against the best in the industry and, developed. So, how do we make sure that we remain in peak condition in order to lead firms that stakeholders assume we have the skills to build, sustain and grow in a competitive world?

Any director worth his or her salt would agree that the legal requirements for diligence and performance have changed significantly in recent years. We expect directors to actively seek the answers they need to make informed decisions. This additional work means more time spent on due diligence, requires greater awareness of the early signs of trouble, and the development of a greater director sensitivity to self-preservation -- in addition to doing the best possible job for the client.

Similarly, the diffuse notion of sustainability has moved to a complex triple-bottom line approach for testing social responsibility, environmental respect and financial stability. Few managers know how to compile a corporate TBL report, so how are directors expected to supervise the process?

We now expect directors to be adept at networking, connecting with friends, professional acquaintances and even peers overseas. They must understand the competitive landscape beyond their own business and ward against being too inward-looking.

So what is the solution to keeping up? There are few local opportunities for directors to get booster shots of governance training. Between the Institute of Directors, Massey University and Waikato Management School, the nationwide offerings are limited. That means directorship do-it-yourself time. …

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