In March 2014 at the Conference of Major Super Funds (CMSF) on the Gold Coast, David Gonski, the chair of ANZ Bank and Coca Cola Amatil and a member of numerous other boards, gave a highly influential speech to a full house of industry fund representatives on what good governance looks like.

He gave a persuasive rationale against boards only made up of men, saying it was “crazy” to only choose board members from 49 per cent of the population.

Since that time, it is hard to think of a single industry fund board that has not improved the gender balance on its board or gone further, as in the case of Sunsuper which has moved from an all-male, Brisbane-based board without independents to one which now has two Sydney-based directors, three independents and two women.

A year and a half later, Gonski has given an update on his views on diversity and given his views on some of the common debates funds are having on climate change, independents, remuneration and insourcing investments.

On the issue of gender diversity, Gonski is modest about the impact of his speech.

“I contributed some thinking to a debate that was open already,” he said, citing how impressed he was with the calibre of the board representatives he met at the CMSF in 2014 and their thinking on diversity.

In backing up his beliefs, this year Gonski has endorsed the 30 Percent Club, a campaign group that aims to encourage the boards of the top companies in the major stockmarkets around the world to have at least 30 per cent women serving as directors. The Australian chapter of the 30 Percent Club calculates that 19.2 per cent of company directors on the ASX 200 are women. This cause has been endorsed by the Australian Institute of Company Directors for all ASX companies.

The ANZ Bank, which Gonski chairs, has committed to achieving 30 per cent for its board by the end of 2017. He emphasises 30 per cent is not a quota but a “fair” goal and should be applied on an “if not why not” principle.

“The 30 per cent club is voluntary, no government is telling you what to do; it is us as a company deciding to join that club.” He adds: “If you have got 30 per cent who are female it will have a natural growth from there. But until you get to that level, it is not as ingrained as it should be.”

He sees diverse boards as being more likely to challenge accepted thinking and as being open to new ideas.

“I am totally convinced that men and women look at things differently, and therefore I feel there are very few businesses that couldn’t prosper and do well from different views coming from around the table. The most dangerous board that I have ever been on is a board where I look around the room and they are all like me.”


For the most effective boards, Gonski favours not only diversity of thought, but independence of thought too. And as such he believes the industry funds opposed to being forced to adopt one-third independents should seek out the positives of such a governance shift.

“We should be seeking to attract the best people for the job rather than worrying about who they represent,” he says.

He defines good independents as people who are highly skilled and independent of thinking, and believes there are “tons” of good potential independents available for industry funds.

“An independent person does not have to be someone against you, in fact I would argue that somebody is not independent if they are violently opposed to what you are doing,” he says. “You should never be scared of them and you should assume they will do the right thing for the whole fund.”

He also believes that while many directors who represent employer or employee bodies could be truly independent of mind, the best person for such a role is an independent director.

“If you are a representative it is very hard to keep your independence of mind, because if you are doing your job by acting as a representative, you actually have a conflict to represent and to be independent. It is much easier for a person to have independence of mind where they genuinely are independent.”

On the less controversial topic of digital know-how on boards, Gonski believes that if such experts do not have the all-round knowledge to serve on a board, then their place belongs on a sub-committee. In this way, the ANZ Bank has a technology committee and the University of New South Wales has accountants sitting on its audit committee. “One day if they are generalists they may come on the council, but to begin with that is where they should make their mark,” he says.


On the thorny issue of pay, Gonski urges boards to take a nuanced approach to paying their senior executives, considering that salary itself is often not the key motivator for individuals.

“Some people are motivated solely by money but a more balanced human looks at more than just money.”

He suggests that for some senior executives, the opportunity to take extra time off, to have a prominent role as a spokesperson or to have a particular title could be a bigger lure than a large salary.

“It is important for boards to understand what motivates people,” he says. “Once they understand what motivates the particular person and work out what they are trying to motivate them towards, then they should try and do that.”

Climate change

The overwhelming evidence from scientists worldwide that the global temperature is rising has led many industry funds to limit their exposure to fossil fuels, most publicly in the case of HESTA, which in September 2014 said it would progressively limit investments in thermal coal.

While Gonski does not deny the evidence on climate change, he words cautiously his response to how boards should tackle climate change issues. Firstly, he recommends that boards be open and talk about the threat and the issue of sustainability, but accept that there are not any right or wrong answers and do not go for an extreme solution.

“Many people will write to super funds saying you should not be in fossil fuels,” he says. “I would say they cannot be sure about that, the board is charged with working out what to do, it is up to them. The best thing to do is [for the board to] get themselves educated on the risks and concerns.”

He sees action as being measured by the board trying to understand what their organisation’s footprint is, and to come to a determination of what they feel is right for their fund.

He emphasises: “Often extreme solutions are not right, but on the other hand ignoring it is not the right thing.”

Insourcing fund management

The growth in insourcing of investments in large superannuation funds has led to much fear of boards and senior executives getting out of their depth, but Gonski is sanguine.

“If a fund is large enough and they have the expertise in house it does not trouble me that they should invest directly,” he says. “The central question when you are sitting there as a trustee is ‘Can you believe your staff can get the opportunities and know-how to use the opportunities to make money?’ If the answer is yes, it is fine.”

He adds that it would always be open to a board to recommend that a fund switch out of in-house management.

David Gonski will be speaking at the Chair Forum at the RACV Healesville Country Club, Victoria, January 31-February 2, for which registrations are open to chairs of superannuation funds.

To register go to


Join the discussion