Robert Walker is Chairman of Travis Perkins, Enterprise Inns and Eagle TopCo, the UK’s largest provider of pre-school nurseries. Prior to this, Robert was Chairman of WHSmith, Williams Lea and British Car Auctions, Senior Independent Director at Tate & Lyle and Chief Executive of Severn Trent. Previously, he spent over 30 years with P&G, McKinsey and PepsiCo.
How would you make boards more effective?
I’d encourage boards to get out of the boardroom and spend more time in the business. Boards tend to be too introspective and turning up to the same boardroom at the same place every month doesn’t help. At Travis Perkins and Enterprise Inns, at least once a year we ‘invite’ ourselves to hold board meetings with one of our suppliers. Dinner and presentations with their management team are followed by our board meeting at their headquarters the next day. You learn a lot from that interaction.
Additionally, at Travis and Enterprise we assign each NED to a specific unit or division within the business and ask them to take responsibility for mentoring and understanding that unit more closely; we then rotate these assignments every 12-18 months. It works well because when an issue arises, I already have an “expert” NED who really knows that unit. It also helps to demystify the board for the wider organisation.
How have boards changed over the last few years?
There have been a number of changes and not all of them for the better. For instance, board committees are more prolific and are assuming wider remits. As a result, we’re seeing more decisions being delegated to committees rather than being made at board level. The danger with this, however, is that it tempts boards to outsource responsibility. But if something goes wrong, it’s the board in its entirety that will be scrutinised, not the committee. Boards should not see committees as a way to delegate their responsibilities.
On another note, there has been a recent trend to regard it necessary to add specific functional skills to the board. While this may be right in particular situations, my own view is that the most valuable NEDs are current and former CEOs or CFOs, who have “been there and done it”. If it is necessary to add specific skill sets, this is best done by appointing advisors to the executive committee, who could also be “on call” to attend the occasional board meeting.
Finally, the requirement for boards to undertake external performance evaluations every three or four years has been an excellent initiative. But this requirement has spawned a cottage industry of providers, many of whom are of variable quality, with little or no direct board experience. As a result, many boards find the exercise provides minimal added value. A Code of Conduct for these practitioners is urgently required.
How important is information in the boardroom?
It is the key facilitator of a healthy, open and productive board discussion. A good monthly information pack should be as brief as necessary, setting out regular information in a consistent format, making it easy for NEDs to track trends and performance from month-to-month.
For other, more ad hoc, board papers, I mandate that these are no more than 15 pages long (including appendices) and I am pretty strict on this. Where appropriate, it is useful for the presenter to add a one-page summary outlining the purpose, key issues and risks, and what they want to get from the discussion. (The discipline of the one-page memo was hammered into me at P&G!)
What book is on your bedside table?
John le Carré: The Biography by Adam Sisman. I’ve loved le Carré’s books ever since 1962 and can relate to them, having spent over 20 years with PepsiCo in some pretty strange situations in the Middle East, Africa, Asia and the old Eastern Bloc.
What is your Golden Rule?
My father, a journalist, didn’t want me to go into business. But when I did, he made me promise “If you ever lose three consecutive nights’ sleep because you are worrying about something, go in on the third morning and walk away. It isn’t worth it”. I kept my promise.
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