IM: You have been a board member of AvSuper since 1999, what do you think are the benefits of that continuity
to the board and the decision-making?
George Fishlock: The biggest advantage, and one perhaps not realised by the regulator, is the corporate knowledge that has been retained. I can explain to another board member or staff member why something has arisen or a decision was made. Having said that, we equally recognise the need to regenerate and I’m planning to move on at the end of my term next year. We have a highly skilled and capable board with the skills and knowledge to go forward. I am very firm that you have to take the right time to move on, and the organisation is in the best position now.
You were an air traffic controller for about 34 years. How does this impact your role as chair of the fund and, in particular, do you think it is important for board members to be able to identify with the membership?
This is important because of the exclusive nature of our type of membership. We have one of the highest average member account balances of any fund in Australia and our members are all well-educated, highly competent and capable people. (The average balance is about $400,000 and in the closed defined-benefit fund, which accounts for about 40 per cent of the membership, the average account balance is $750,000). Our members are very conscious of superannuation and the markets. We had very little commentary after the GFC and a very small number of members withdrawing money or switching to cash, because they understood the situation and the need for long-term investing principles. Advice services are critical to our members and we have been focused on those services.
As the chair of a relatively small fund, do you have a particular view on mergers and how the fund can continue to best service its members?
We are quite happy as a boutique fund because of our membership. We don’t need huge call centres, and we have only about 15 staff, so we have lower overheads. As the trustee, a merger would have to stack up as a business case, and we can’t reduce our current services to members. We would need to merge with a fund with a similar profile to make it worthwhile, and we are open to discussions. Also, high-balance members are prepared to pay a little more, as they value the services and the personal touch of our staff. We know our members by name, and some of them know the staff by name. It’s very personal. If we merged with a large fund and the services we offered members [became] part of a large call centre, that arrangement wouldn’t be an improvement for them.
What is your best piece of advice for how to chair a constructive board meeting?
I have the best board in the world. They are highly skilled and their personalities all mesh really well. We have equal employee and employer representatives and have never had any angst. It’s a really easy board to chair. Each board member trusts the others, and we really trust our committees. I’ve had an easy run of it. I can thoroughly recommend the [Australian Institute of Company Directors] directorship and chairing courses. They teach some great techniques for managing meetings and boards.
What is your view on the current debate around governance and the value of independent directors for super fund trustees?
This issue is not going away and we are not going to try to hold back the dam wall. There is nothing wrong with the current system but the independent model can work better. We have had a discussion around this and have made an application to [the Australian Prudential Regulation Authority] for an independent director model. We will probably end up with the 3:3:3 model. It is difficult to find the right skillset in board members and this will continue with the complexity of super. It takes a while longer before superannuation board members can be competent, compared with board members for corporations or not-for-profits. Highly skilled directors are in high demand, so independents will broaden the pool to choose from. We see value in it.
How have your views about what makes a good chair changed over the years?
The board expects a lot from you as a chair. The chair becomes so responsible for setting the strategic direction and areas where focus is required. You have to think about where you want to go with the board. We have gone away from having a one-day offsite to talk about strategic issues and now focus on at least one strategic issue at every board meeting. We still have an offsite to do some naval gazing but
we discuss important issues at every meeting. There are so many things to talk about you can’t do it in three to four hours; you have to do it throughout the year.
What is the most important conversation you are having around the board table this year?
Legislative changes, whatever they might be. We have a philosophy that we get on with it and do it. We were one of the first funds to get an AFSL, if not the first, and we were early adopters with RG 97. It is easy to make decisions at AvSuper and we can get them made quickly because we lack the bureaucracy other funds might have.
How would you describe your relationship with chief executive Michelle Wade and the executive team?
Along with having the best board, I’ve got the best CEO in the country, too. Michelle and I talk two or three times a week and bounce ideas off each other. She is the best investment our fund has made. She has brought a vibrancy and fresh outlook to everything. She has a heavy customer-focused background and was one of the reasons we focused so heavily on our advice services. In the first board meeting she attended, she said “that’s the end of the paper copies” and gave everyone an iPad. She has built a team that are all Gen X and Gen Y. They are young and talented and very capable.
Who are your most important mentors and whom do you turn to for advice now?
I’ve learnt from our membership – but also in other capacities, such as when I was a ministerial appointment to the prisons – that there are people out there and members of funds who don’t understand super, are not financially literate, or not even literate in English. You can have members who don’t know what you’re talking about. Over the years, I’ve learnt we need to be a bit humble about what we’re doing and communicate in the best possible way. The best mentors are the people I have been exposed to who have given me that perspective.