Patience Wheatcroft is an NED at wealth management company St. James’s Place PLC and automaker Fiat Chrysler Automobiles, as well as a life peeress of the House of Lords. She served as non-executive director of Barclays Group PLC and Shaftesbury PLC, and was a trustee of the British Museum. A journalist, Patience was Editor-in-Chief of The Wall Street Journal Europe and held positions at The Sunday Telegraph, The Times, and Mail on Sunday.
What changes would you make to UK boardrooms to make them more effective?
So much time in a board meeting is spent looking backwards, and it’s crazy that you spend all that energy looking at things from which you can learn lessons but can’t affect. So, to try and turn the balance in favour of strategy and forward-thinking, I’d have every meeting begin with asking the CEO what’s keeping them awake at night — it’s the one question the board absolutely needs to address.
Sometimes, I’d also be prepared to throw away the agenda. There should be a period at the end of the meeting, at least just half an hour, when anybody could raise anything they wanted to raise, and that would be debated and taken seriously by the board.
How have boards changed over the last few years?
They’ve got a bit younger and more varied overall. Financial Services boards are more diverse from a gender point of view but not in terms of expertise — and that’s really a problem with the regulator as much as anything.
It may be that the idea of worker directors takes off and becomes the route to getting more diversity in the boardroom. There are some issues with the concept, but the proof will be in whether they bring useful input. Upskilling those who put themselves forward for that role can be a challenge — not to mention the need to make them feel empowered enough to say things in board meetings.
At Saint James’s Place, we took the approach that people, on the whole, wouldn’t want the hassle and risks — financial or reputational — of being a director. Instead, we created a new function, and I’m now the NED responsible for employee engagement. We’re approaching this not as a box-ticking exercise but a way of genuinely listening to staff and benefiting the business.
Are boards out of touch with society? If so, how can they re-engage?
I did a lot of work around trust in business with the Saïd business school. It came down to the 3 Ns: Networks, Norms and Narratives.
Boards speak to each other, and they may use social media, but that’s for broadcasting rather than listening. There’s a real need for them to increase their network and the number and variety of people they engage with. By doing so, they’ll wake up faster to the changing norms they’re behind the curve on — whether that’s tax, remuneration, or global warming. And that, in turn, will allow them to take control of the narrative and communicate on the good they’re doing.
There’s actually a lot of positive things and genuine CSR happening, but boards don’t talk much about it. They’re very nervous about going public, and being accused of hypocrisy and jumping on bandwagons. When Grenfell tower came down, several companies went in immediately to help: Tesco provided food, property companies provided all sorts of accommodation immediately… yet they all ticked the no-publicity box because they didn’t want to be seen as cashing in.
How can government best support business?
I think we’ve seen plenty of evidence that too much regulation or demand from the FRC does not bring about good behaviour, and I tend towards ‘less government is better government’. There are exceptions, however, and there is no doubt that gender pay reporting has had a positive effect because it woke people up.
It will be interesting to see whether the new rules on reporting CEO pay and median pay will have a similar impact. I have a feeling it might not and that the government will have to intervene in the end — because it’s breeding such inequality and resentment, and it’s unjustifiable for people who have not taken the huge risk of setting up a business to get the millions and millions of pounds they are being paid. While we’re at it, we should also simplify remuneration and do away with the bonus system which provides the wrong incentive. People go to work to do their best — so what is it all about with bonuses?
Then, improving education — we’re not ranking well in the OECD league tables —, investing in the right infrastructure, and ensuring stability for the small-and-medium-sized business who can’t cope with brutal changes the way large companies can. Those are the sort of things that really help business more than anything fancy.
What is your proudest business achievement?
I’ve been in positions where I was able to build teams, and it was a great privilege to, not only get to work with people you really like, but to be involved in the crucial business decisions of hiring the right people. One of the big ones we had recently was at Fiat Chrysler Automobiles — which should be expected when you lose a CEO, and particularly an extraordinary one like Sergio Marchionne.
Sergio was the most amazing person I’ve ever worked with — one of the cleverest people imaginable, he engineered the Fiat takeover of Chrysler, which was transformational for both businesses. But he was not just a brilliant business brain and political operator. He was incredibly witty and warm, a truly caring person who nurtured his team as individuals.
What book is on your bedside table?
A book on the drawings, lyrics, and poetry of Leonard Cohen. My husband got it for me — I’ve been a Leonard Cohen fan for ever!
What is your golden rule?
As an NED you’re totally at risk to the executives, and therefore it’s absolutely essential that you not only trust their abilities but also their ethics — and that’s valid for the entire top team. When on a board you need to feel that you have won the trust of the executives and can have an impact in taking the business in the right direction, otherwise there isn’t a lot of point.