Why the board that got you here may not get you to where you're going

Rebecca McGrath AM FAICD on why a board needs to evolve as the organisation grows and diversifies.

Director roles have become increasingly demanding during McGrath's career. "It's because of an increase in the pace and cycle of change, and the degree of competitive intensity," she says.

"There are economic and geopolitical factors that are significantly challenging to directors. Management looks to boards to help them work with uncertainty. We don't have a crystal ball, so our ability to understand risk, help management deal with risk, and to reduce that risk as much as possible is probably the most significant evolution I've seen in the past decade or so."

Having taken up her first board role in 2011, McGrath is now a director of Investa, UniSuper, Macquarie Group, Djerriwarrh Investments and Melbourne Business School.

Lesson 1: A board needs to elevate itself as the company grows and becomes more complex

When I took over as the chair of OZ Minerals, it was a one-asset, $1b organisation. It was later sold to BHP for nearly $10b as a multi-asset, international company. We aspired to grow the business and my lesson was in the way we worked as a board, particularly with management.

Each year, the board went through a particular process of reviewing whether we were operating at the right level as the company grew. Was our degree of oversight and governance appropriate for the current timeframe? This could include processes around strategy and planning, financial delegation and decision making.

We'd also consider whether we were asking management the right questions in light of our increasing scale, size and complexity.

As a larger company, the nature of the detail we would ask for around financial and operational performance had to be at a higher level to ensure we wouldn't be intruding on management's space. We needed to look at the performance of a portfolio of assets, as opposed to effectively being the board of a company with one asset. Once you start to aggregate the performance, you look at potentially different levers around performance.

Lesson 2: Ensure alignment between board and management on strategy - the "what" and the "how"

When you're in a larger-scale commercial property business doing construction, there are challenging factors around contractors, supply chains, costs and capability. Having alignment between management and the board has been very advantageous to us at Investa.

At our recent annual board and management offsite, much of the conversation was the board testing management about capabilities and people - and how it would stretch management to go into a new area of business. We talked through all the aspects of "how" we would go about it, as well as "what" we'd be working on.

When you're in a physically oriented, asset-intensive business, it's easy to not have enough focus on the how. This can impede progress in doing the things you set out to do.

"How" means asking things like, how experienced are we in that new business? How well do we know the market? How skilled are our people? Do we need new people? Do we need to upskill them? How well are those people regarded in the market when it comes to attracting new investors? Should we talk more about our track record in this new area than we have done? How strong are our supporting functions to execute on this?

Be aware of unconventional disruptors and new challenges to the business model

When you join a new board in a business or sector you're not familiar with, it's important to understand who could disrupt it. You need to quickly get up to speed on the current business first, then work with management and board to learn more about potential threats and new players who could disrupt the business in a way the sector hasn't seen before. This will ensure you can make valuable contributions in board discussions about strategy, risks and the future of the business.

At Melbourne Business School (MBS), I've learned there are many unconventional disruptors in the tertiary education sector. With the appetite for online postgraduate education growing rapidly, we've reflected on how effective and distinctive we are at online program delivery. Are there other players who see the executive education sector as an attractive revenue source?

MBS went through a challenging period during COVID. It was successful in pivoting into an online environment and offering an online MBA, but the world doesn't stop. So, how do we continue to provide attractive programs in a globally competitive post-grad education sector where students can access courses from eminent institutions all over the world? 

This article first appeared as 'Rising to new challenges' in the Oct/Nov 2026 issue of Company Director Magazine.