Lessons from a listed company director: Susan Peterson

Director Susan Peterson takes the hours of each board meeting for the year and multiplies by four.

She knows when she has board meetings as much as two years out and plans accordingly.

“I work out whether I'm sensibly able to fulfil that. And if not, then, you obviously don't take on another responsibility.” 

Building in those additional hours, the experienced New Zealand stock exchange (NZX) director says, gives her enough  time to read, to work on board papers and company matters and deal with any surprises. 

“I’m full time, but with flexibility.” 

There are always surprises, the chair of Vista group says. 

Take time for nothing

Each week “has to have a part of nothing in it”, to be able to address issues as they come up. 

It could be a challenging phone call from the company chief executive officer (CEO), for example; you must be available to take such a call whenever it comes, she says.  

Peterson says being a listed company director means creating a psychologically safe environment for the CEO. 

Choosing the CEO is the most important decision a board makes, she says. “Most of our careers now are in that mindset of, we help others to be successful.” 

The CEO needs companionship. Otherwise, it can be quite lonely, she says.

“They can’t always discuss issues with their direct reports. Sometimes it can be simply venting or sharing challenges and thinking about what to do. Sometimes they want to hear your thoughts, sometimes they just want to tell you, because they know what they're going to do but they're just processing with somebody who's trusted and they know you’ll keep those confidences so that they feel safe.” 

Listen more

Peterson, who is on the boards of Xero, Mercury, Craigs Investment Partners and Arvida, says directors must listen more than speak when a CEO needs to talk, and respond calmly but not immediately. 

“Don’t rush things,” she says. “Ask open-ended questions.” 

Peterson sees her role as director as giving the CEO the right framing for an issue: Who else is affected? What’s the scope? What have we done? Do we have all the information we need? 

"You never expect the CEO to do what you suggested. You just prompt and challenge and support and encourage and they will take your information and they'll find the best way, because they're closest to the business."

The board's role is to set a calm tone from the top and navigate confidently through challenging situations, Peterson says.

The board should never throw the CEO under the bus.

"You have to back them, back their decisions, publicly."

No surprises

Inevitably, she says, the trickiest issues are the human ones, the personnel issues. 

“There will always be surprises where there is human behaviour involved.” 

But where she wouldn’t expect a surprise is in the accounts. 

Peterson says working on the numbers is a year-round job. 

Directors are consistently looking and monitoring the numbers, she says.  How is the company tracking against the budget? How is it going against forecasts? Is it going against what the analysts think? 

“We have conversations each month or every six weeks about whether there are any problems we need to solve such as if you've got revenue challenges, you might need to think about cost opportunities or other ways to serve customer needs.” 

The board is constantly “pulling the levers throughout”. 

What they’re aiming for is an orderly, organised audit risk committee and all the pieces in place for a smooth result, Peterson says. 

“You should know the numbers are within cooee of where you want them to be. It wouldn’t be a well-managed process if you got a surprise at that stage.” 

Choose your room

Peterson says there is an art to "holding the room" as a director. But the first critical part is carefully choosing which rooms you want to be in.

She is very deliberate about which companies she works with, whom she wants to share the boardroom table with, and the attributes they bring.

"A lot of that's about their behaviour, their curiosity, their adaptability, how they define success moving forward. Holding a room comes from that perspective, doesn't it? People see that there's value from everybody's perspective, and that everyone in the room is learning. It's not just one person telling and the other person sort of saying things. Holding the room means trust, respect and being prepared to admit when you don't know."

Peterson looks for decent people first when choosing a board. She likes megatrends and finding companies that will ride those trends. Technology, the ability to transform lives with tech, the ageing population and sustainability are all trends she's excited about.

"If you're interested in something, then you tend to be more excited and do a better job and it won't feel like work at all."  

This article was first published on BusinessDesk. Rebecca Stevenson is an award-winning business journalist and business commentator. She is a former national business editor of Stuff and business editor of The Spinoff.