Beef CEO turnover fuels speculation

25 Aug, 2017 06:54 AM
NTCA chief executive officer Tracey Hayes.
NTCA chief executive officer Tracey Hayes.

THE TURNOVER of top executives in the beef industry of late is fuelling speculation about whether the unique challenges associated with heading up an agricultural outfit are causing an imbalance.

The experts, however, say a misperception has possibly been created given the high profile nature of the beef chief executive officer churn in the past six months and the fact several changeovers have coincided.

Cattle Council of Australia has now had three CEOs in just over six months.

The Northern Territory Cattlemen’s Association last week announced Paul Burke would be it’s new leader, Agforce’s CEO steps down this month and Jason Strong’s parting from Australian Agricultural Company, announced three weeks ago, has been the talk of the industry.

That is just a few of the more notable shifts.

Amid them are plenty of breed society comings and goings, the most prominent being the decision of Herefords Australia’s Alex Ball to forego the CEO role less than 12 months in but then take up another managerial position with the organisation.

Academics and recruitment specialists say the resignations and appointments the beef industry has seen are in sync with other sectors and are in fact a healthy and natural process.

The typical tenure length for a CEO or managing director is three to four years and certainly the beef industry is tracking in line with that, despite recent anomalies.

Agricultural economist and head of the University of New England, New South Wales, business school professor Alison Sheridan said the CEO role in any sector was difficult and complex and required enormous amounts of energy and attention.

“It’s accepted there are periods for which an individual will be able to contribute what they can and then a time will come for the next person to come through,” Professor Sheridan said.

“We are seeing that cycle becoming shorter, mostly because competitive pressures and changes in trading environments are increasing.”

Tenures of vice chancellors were becoming shorter and CEO turnover in financial institutions was­ following the same trend, she said.

“Quite often it is not the case a CEO was moved on but rather their own decision,” Professor Sheridan said.

“Today it is a 24/7 job and 20 years ago that wasn’t the case.”

Professor Sheridan said patterns of behaviours in this area were relatively under explored, although an interesting theme appeared to be how quickly CEOs turned up in other roles after moving on.

As an example, she pointed to former New South Wales premier Mike Baird, who resigned from politics, something he framed as a rejuvenation, then joined National Australia Bank as chief customer officer of the lender’s corporate and institutional banking unit within months.

Professor Sheridan said their networks and connections allowed this to occur.

Research she conducted eight years ago showed about half the number of CEOs had university qualifications but said this was changing.

“We are seeing a more educated workforce generally and that is flowing through,” she said.

A Master of Business Administration was reasonably common across executive positions but certainly not a requirement, she said.

Increasingly those with CEO ambitions are doing specific training programs, such as the packages offered through the CEO Institute.

In agriculture, the greater cycles of uncertainty and the fact a CEO is typically answering to an extremely passionate and invested board, but one not always having a wide degree of corporate governance experience, could pose unique challenges.

Professor Sheridan said the latter characteristic was not unusual in other sectors either.

To address it she said industries were placing more and more attention on the sorts of skills sets members on boards bring.

It’s generally called capacity-building training and two of the red meat industry’s major bodies, Cattle Council and Meat and Livestock Australia, last week announced a major funding initiative aimed at driving industry upskilling.

Alison Penfold, who held what is arguably one of the toughest gigs in beef, CEO of the Australian Livestock Exporters Council for four years, agrees leadership in the sector is relatively stable.

“The common challenge is the fact these associations are running on the smell of an oily rag and there are expectations of beef sector peak councils that are unique,” Ms Penfold said.

“But beyond that, there are no broader correlations – each CEO change reflects an individual set of circumstances.”

Ms Penfold stepped down from ALEC last year and is now working in the corporate sector in a government relations position.

It was her first CEO role, although she did come from being State director of The National Party, and she described it as the best she has had.

“I got a lot from it, it’s an honour to work for producers and I’d encourage others to give it a go,” Ms Penfold said.

The biggest challenge?

Ms Penfold said understanding members’ ideas of what their future looked like and aligning that with a future that the community expected.

“The job was about presenting a different way of engaging with the community and understanding their concerns about animal welfare,” she said.

“Taking the industry on that journey was part of the deal.

“The live-ex industry is in a stronger position because they’ve taken time to understand that.”

Tracey Hayes became the first female to lead the NTCA in its 33-year history when she took the role in May 2014.

She was previously NTCA’s executive officer and said that assisted the transition to what was also her first CEO job.

While she has opted to move on this year, she said the CEO path in agriculture was one she would pursue longer term.

What makes it hard to stay in these roles for any longer than a few years?

“In order to do the job well, you need to live and breathe it – that’s the reality and you can’t sustain that forever,” she said.

“I’ll be honest – I didn’t find the remedy for work-life balance, although I did get better at it the longer I was in the role.

“A CEO skill set is one thing but with ag you need the capacity to connect with grassroots members, to listen to their needs and understand their requirements but also, at the same time, to operate at a state and increasingly federal government level and even in the international space.”

Shan Goodwin

Shan Goodwin

is the national beef writer for Fairfax Agricultural Media.


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