A natural leader

Sir Eion Edgar DFInstD’s first meeting as a director of the NZ Stock Exchange was 20 October, 1987. Black Tuesday.

It was the start of a global crash that destroyed 60% of the Exchange’s value over the next four months. He took it in his stride.

“The stock exchange role was fascinating,” says Sir Eion wryly.

“We realised that, obviously, four or five of our members were insolvent and probably more. But we restructured and put the Exchange back on its feet – without government help.”

For Sir Eion, it was a chance to put into practice the governance lessons he had learned as a Forsyth Barr director. Forsyth Barr is a growth success story in New Zealand. He began working there in his university holidays, became a partner in 1973,then joined the board when it incorporated in 1978 and has had a lifelong association with the financial services company - including 20 years as chair.

The lessons he learned there have stood him in good stead across many governance roles, he says.

Leader in goveranance

“When I started at Forsyth Barr, there were 10 of us. Now there are 450 in 23 offices. Being involved at the coalface there gave me great satisfaction.”

The most valuable lesson learned, he says, was: “Surround yourself with people more able than yourself.”

It’s, perhaps, an overly modest statement. In a varied governance career Sir Eion has achieved more than most and served as a director of the Reserve Bank, chancellor of the University of Otago, president of the New Zealand Football Association, president of the New Zealand Olympic Committee (now honorary president for life), chair of the aforementioned Stock Exchange and a founding trustee of the Arts Foundation of New Zealand. Plus many more commercial and charitable roles.

In April 2021, he was made a Distinguished Fellow of the Institute of Directors, the highest honour the organisation can bestow. If there was ever a natural leader, he is it.

“It really started in my school days,” he muses.

“I was always organising things. I was made a prefect. Then at university I got involved in student politics and was chairman of the Commerce Students Association. I liked being involved in leadership and liked getting on and doing things - and I found the best way to get on and do things was to start it yourself. Other people were happy for you to show the leadership.”

If you are interested in governance, don’t be afraid to put your hands up, he says, but be prepared to “start at the bottom”.

“I started with the local kindergarten committee and then the school committee.”

The great thing about those types of committees, particularly if they ask you to chair, is that you have to learn to work with people, he says.

“You have to find a way through, to respect people’s views and all recognise that you have to find a solution. That’s one of the important things in governance, recognising that people have different views. But the most important thing for a board – or a school committee – is to come to a decision.

“Don’t throw your toys out if it’s not what you wanted – at least you contributed to the ideas.”

Big league player

Sitting between superpowers China and the USA at Olympic discussions is a far cry from a Dunedin kindergarten board meeting. But Sir Eion talks about his time chairing the New Zealand Olympic Committee in the same breath.

“I was always asked by the Chinese if I would talk to the US, or the US would ask if I would talk to the Chinese. As in many areas on the international stage, New Zealand was seen as a friend to everyone. We were able to act as a sort of catalyst to ensure nations established better relations. So both of them wanted you to sit at the top table with them - well above our status for a country of our size.

“That was a fantastic role because it not only covered all the sports but had a wider mandate through Olympism and the educational aspect of it.”

Sport has been a big part of Sir Eion’s governance career. Alongside working in some of New Zealand’s most popular codes – football, rugby and tennis among them – he has played sport most of his life, with basketball, cricket and tennis among his favourites. His passion for community sport, too, is evidenced by Dunedin’s indoor sports Edgar Centre, to which he and his wife’s Charitable Trust donated $1,000,000.

“I have always been a sports fanatic. Not that good at it, but always competitive.”

Sir Eion (centre front row) at the Dunedin Stock Exchange circa 1980

Giving back

As a patron and philanthropist, Sir Eion has offered his governance expertise alongside donations to the benefit of his community. He has given time as readily to the Queenstown Trails Trust, a non-profit that develops public walks and cycle trails, as to more high-profile roles such as the Otago University Council, which he chaired as chancellor.

“My involvement with the university came about because, when I came back to Dunedin, I saw that it was by far the biggest industry, the most important thing for the city.”

While admitting to bias, having graduated from Otago University and spent 23 years on the council, he says it is an example of what a tertiary institution should aspire to be in New Zealand.

“It is outstanding. It’s New Zealand’s oldest, finest university.”

This willingness to give back to his community and his ability to guide organisations to success have been recognised in many awards over the years.

Sir Eion was made Companion of the New Zealand Order of Merit in 1996, a Distinguished Companion in 2003, and then knighted on the restoration of titles in 2009 as a Knight Companion of the New Zealand Order of Merit. He was NBR New Zealander of the year in 2004 and has been inducted into the New Zealand Business Hall of Fame.

Becoming a Distinguished Fellow of the Institute of Directors, he joins a small roster of leaders including Dame Alison Paterson, The Right Honourable Jim Bolger, Dame Margaret Bazley and Sir Tipene O’Regan.

“I am extremely honoured to be made a Distinguished Fellow, when I look at some of the other people who are there, a lot of who I know and have great respect for,” he says.

What make for good governance?

Firstly, he says, the most important relationship is between the chair and the chief executive.

“That is absolutely vital. When I look back at things that have gone well, in each case there was a strong relationship between the chair and the chief executive. You have to get that right. If it isn’t working then one needs to go.”

Secondly, he says, effective boards give a voice to all directors and find solutions even when they have disagreements.

“As a director, recognise that you do not have all the ideas and encourage others to voice their views. You don’t get the best out of people unless you give them that opportunity. As a chair you may have people on a board with strong views and you have to say to them, ‘you are not the only one. There are other views and you may learn from them’.

Strong views shouldn’t make a chair’s job harder because the best solutions tend to come from shared knowledge.

“In most cases, that should involve diversity because you get a range of thinking. That diversity of thought helps. But the important thing is to make sound decisions and you want the best people around the table in order to do that.”

Remembering who you work for is also important. Directors must recognise they act for all shareholders, he says.

“I had a situation with Mr Chips where I was chair and majority shareholder. But when we sold it everyone received the same price. That was a key thing. My view is that you act in the best interest of all shareholders.

“With Mr Chips we had shareholders who were potato growers. It was in their interests to have the potato price high, while that might not be in the interest of other shareholders. You have to try to balance that.”

Governance, he says, is all about getting the best result for the people you are acting for. In a lot of cases that is a really wide brief, eg sports organisations or the Olympic Committee. You won’t get every decision right, so strive to go through a thorough process before you reach a decision.

If boards can do that, they will help New Zealand emerge from the impacts of the pandemic “in great shape”, he says.

Asked where he sees the country in two year’s time, Sir Eion’s optimism shines through.

“We will be starting to pay down our debt. Our agricultural exports will continue to grow. Our local economy will be stronger. As long as we can resolve the delays with getting COVID-19 jabs then I think we are in a good position.

“At the end of the day we are lucky to live in a wonderful country and I can’t see why we wouldn’t be in better shape than most places.”