In the eye of the storm

Susan Ryan has had a number of career changes, but none more challenging than her current roles as NRMA director and the public face of union shareholder activism.

In both instances she is in the centre of a gathering storm of shareholders demanding more democracy and accountability from their boards. The irony of the situation is in the case of the NRMA she is on the receiving end of shareholder anger and in the union stoush with mining giant Rio Tinto she is helping fire the shareholder bullets. She talks with JOHN ARBOUW about fighting the good fight.

Politicians call it limelight deprivation. The term used to describe the change from a high profile Canberra mover and shaker (Ryan was a Hawke Labor Government education minister from 1983-87) to a private sector position that does not carry with it the same relevance of making important decisions while in government. Some make the transition gracefully and go on to make a success of their "second" career without carrying obvious baggage. Almost all feel the need to have a cathartic experience of their previous life by writing "the book". Susan Ryan made a very successful transition to the private sector when she first worked for the plastics industry and then became CEO of the Australian Superannuation Funds Association. Under her leadership ASFA became a powerful voice. However, the lure of the pen proved too compelling and in 1997 she resigned from ASFA to write Catching the Waves a semi-autobiographical account of her period as a politician and a treatise on public policy. Susan Ryan's journey from a convent in the Sydney beach suburb of Maroubra to university, to life as a diplomat's wife and then into a career as a leading feminist and politician (she was the only woman in the Hawke Government) has not been, as she says, "without its moments".

Now the book is published, she is back in the fray. During the writing sabbatical she accepted a position as NRMA director and she is advising the Australian Institute of Superannuation Trustees. She has also accepted the role of media adviser and lobbyist to the ACTU/CFMEU shareholder campaign against Rio Tinto. "I am also a director of the SGIO which is the former South Australian government insurance company that is now wholly owned by the NRMA. So even while I was writing the book I was busy with NRMA matters," says Ryan. "While I was involved with the NRMA, I became heavily involved with corporate governance issues particularly with relations between directors and between directors and management. As NRMA directors we have been involved with range of issues.

"For the two and a half years that I have been a director, I have been somewhat dismayed at the number and type of problems that the NRMA board has had to face. I am currently on the due diligence committee that is looking after the demutualisation and the share offer to members." (The latest problem is the resignation of Anne Keating, the sister of Paul Keating from the factional group headed by chairman Nick Whitlam)

Ryan's involvement with AIST (the trustees of not-for-profit company funds) is to advise on forming a new charter that will involve research and shareholder advocacy. "The Rio Tinto initiative is separate from AIST," Ryan explains. "The CFMEU came to me independently because (national secretary) John Maitland had decided to go ahead with the shareholding initiative against Rio Tinto. They wanted someone who was not from the union movement.

"They want me to handle the media relations in this campaign but more particularly to make the approaches to the institutions regarding the two resolutions." Ryan says the first resolution put forward by the unions is perfectly acceptable in terms of corporate governance principles which are the custom in Australia. The second resolution, however has other implications. "If relations between Rio Tinto and the union had been more harmonious we wouldn't have seen so much focus on this. The issue is how far directors should take an interest in industrial relations policy of the company.

"The issue for the trustees of super funds with massive investments in those companies is how much they should concern themselves with matters such as employee relations. I would be the first to say super funds with investments in Rio Tinto should not be the ones telling Rio Tinto what to do with industrial relations. The relevant issue is shareholder value. Rio Tinto obviously believes that by moving to individual bargaining it will cut costs and that this will provide shareholder value in the short term.

"However, you can also say that if they run down the industrial relations infrastructure within their operations, they might find that they don't have the workforce with the skills and reliability that they need to maintain shareholder value." In an age where 53 percent of Australians own shares either directly or indirectly, the concept of industrial relations between employees and management is inevitably blurring the "us versus them" dichotomy that gave birth to the need for industrial relations in the 19th century.

Ryan maintains that the industrial relations model for the 21st century is a question of stakeholders. She says Rio Tinto workers are already shareholders either directly or indirectly through their super funds. "Therefore their interests are not the same and their actions should not be viewed the same," she says. "In the past it was a short-term interest centred around the weekly pay packet but now their super is invested in companies such as Rio Tinto and if these companies do not prosper in the longer term then they suffer as well." But if the relationship has changed, then why is the rhetoric that is often used by union leaders still predicated on the old adversarial dichotomy of poor workers versus rich bosses?

"I have looked at the some of the material from a recent international miners conference that was held in Canberra and they were calling for co-operative arrangements between them and Rio Tinto. They were talking about corporate governance issues and they want a right to collective bargaining.

"I have no idea how many workers Rio Tinto employs globally but it is a tremendous number. The idea that this workforce does not need a formal representative structure is unrealistic to me." Ryan believes union structures are necessary to ensure that workplace safety and health is looked after. She says accidents continue to happen in mines and the construction industry is still a dangerous place to work. But leaving aside the question of workplace safety or the philosophical underpinnings of the union movement, isn't the tabling of the resolutions at the Rio Tinto AGM merely a tactic by the CFMEU to gain publicity and support for its industrial relations dispute with the company?

"That's putting a negative spin on it. You could say that instead of the disruption of conventional industrial relations they are presenting, in my view, a clear code of industrial relations and they want to put this to shareholders,"' she says. Ryan is spending the period before the Rio Tinto AGM lobbying the super funds to vote in favour of the resolution. She is also waiting for the AIST to make a decision regarding its proposed role as a shareholder activist.

The former politician is about to get back into the limelight and become the new face of shareholder activism.

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The purpose of this database is to provide a full-text record of all articles that have appeared in the CDJ since February 1997. It is aimed to assist in the research and reference process. The database has a full-text index and will enable articles to be easily retrieved.It should be noted that information contained in this database is in pre-publication format only - IT IS NOT THE FINAL PRINTED VERSION OF THE CDJ - therefore there might be slight discrepancies between the contents of this database and the printed CDJ.