Life Fellow Val Smith on the value of strong board relationships

Sunday, 01 March 2020


    Val Smith FAICDLife, former director and chair of numerous Tasmanian companies, reflects on the importance of good people, shared purpose and effective teamwork.

    I’m a 1934 model and a bit of a traditionalist — I don’t even have email. But as a Hobart solicitor who can read a balance sheet, and a former director and chair of several companies, I’ve seen a lot of changes in business. A constant requirement is the art of dealing with people — and it’s often overlooked. You need your team to function with belief in one another, good communication and a sense of shared purpose. If you don’t have that, you don’t have a business.

    We had tremendous teamwork at Blundstone. I was chair of [parent company] Cuthbertson Holdings and on the board of Blundstone for 26 years — I finished last October. Looking around the room at my farewell lunch, it was a pleasure seeing how young everybody looked. It showed what a cohesive team can achieve. At Blundstone, they have a five-year plan and they’re all working on the same page and doing the right thing by the company.

    CEO Steve Gunn has recruited well, with an emphasis on quality people. It’s something you’ve got to have if you’re exporting to 50 countries. We’ve only got one factory in China, but we manufacture in Thailand, Vietnam and Mexico. We even had a factory operating in Transylvania [Romania]. In a global business, you’ve got to be ahead of the game.

    The sad part of the Blundstone story is that the ANZ bank cut up rough when we were having trouble manufacturing leather footwear here in Tasmania. We also had a tannery in south Hobart. ANZ was going to lower the boom by appointing receivers. At that point, we had to make a decision about continuing a brand that had existed since 1870. It was a difficult time and I felt sad for the 200 people who lost their jobs when the factory closed in 2007. I remember when we got the news about the proposed receivership. The thing that saved us was that shareholder families put in and kept the company afloat. Once again, success came from the foundation of people working together.

    Lucky man

    I’ve been lucky all my life. My parents understood the need for their children to be educated. I was born in Campbell Town, in the midlands of Tasmania, and my parents upped stumps and left friends and family to head south so my seven siblings and I could get a decent education. I went to Hobart High School.

    Personal contacts matter. My father was secretary of the Campbell Town branch of the Labor Party and he knew Roy Fagan, the Attorney-General of Tasmania (1946–58). When I matriculated, my father took me into Fagan’s office and I told him I’d like to be a lawyer, but I’d have to study part-time because we didn’t have any money and I had to work.

    There was a prohibition against studying law part-time, so Roy advised me to do commerce instead and, when it was finished, do the balance in law subjects. His advice was invaluable. I graduated with a commerce degree in 1958 and a law degree in 1961.

    Hobart firm Dobson Mitchell Allport took me on as an articled clerk and I got a good grounding in commerce and law. I became financially literate and my focus ever since then has been commercial law. I ended up as senior partner.

    Contacts and networks were important early in my business life. The firm acted for most major companies, such as Cascade Brewery, so I got to know CEOs and chairs.

    Over the years, I’ve done many mergers and acquisitions in Hobart. One of the most interesting periods was the mid-1980s, a busy time in Australia for corporate takeovers. I’d been a solicitor for the Foster family — which had large pastoral holdings in Tasmania, Victoria and Queensland — and advised them to gain majority control of the North Australian Pastoral Company (NAPCo). I learned how tough the business world can be and how hard the game is fought. In 2016, the Queensland government acquired 79 per cent of NAPCo. The Foster family owns the remaining shares.

    In 1988, I went with NAPCo directors on a trip to south-west Queensland and through my Cascade Brewery ties was able to arrange deliveries of Cascade Premium Lager at every stop — so the beer was cold when we arrived at each new property. It’s all about relationships and working with people. At the end of the day, that’s business.

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