Dr McTaggart’s career has travelled through diverse terrain. Since attaining a first-class Honours degree in economics from the Australian National University (ANU), followed by a Masters and Ph.D. from the University of Chicago, his professional life has encompassed impressive stretches in academia, the public service and finance.
“I actually started a degree in science,” McTaggart says, “…but I didn’t like it. I did well in the maths sides of things, but I wasn’t enjoying it.”
He cites reading The Limits of Liberty by James M. Buchanan, a modern classic of social philosophy which examines the contractarian nature of the state and the rights of the individual, as the catalyst for switching to economics. James Buchanan was also a Ph.D. alumni of the University of Chicago, and later the winner of the Nobel Prize in economics in 1986.
“[This book] explained a lot about society and life for me. The more I learned, the more I became influenced by the Chicago approach to economics, which is very consumer-focused. I think I’ve had a clear understanding of economics from the point of view of the consumer since then.”
Following his studies, McTaggart took up an academic career, in the US for the most part, before taking up a position as Professor of Economics and Associate Dean at Bond University (1989-1996). He then served as Under Treasurer for the Queensland Department of Treasury. Along the way he was significantly involved in competition and regulation policy matters. In 1998 he began as CEO of the Queensland Investment Corporation (QIC) – which, under his leadership, diversified considerably and achieved outstanding growth.
He left as CEO in 2012, after 14 years with QIC, but McTaggart says, “I wasn’t about to retire!”
When asked about his transition to a career in governance, he responds, “I wouldn’t say I’d built a network, but by the diverse nature of my work I knew people who had worked as directors. It was a natural move for me.”
Since 2012 he has advised federal and state governments, the Northern Territory Government’s Economic Development Advisory Panel, was a Commissioner on the Queensland Independent Commission of Audit, and from 2012-15 was Chairman of the Queensland Public Service Commission and a member of the Queensland Public Sector Renewal Board. His currently sits on the board of the Suncorp Group and chairs its Audit Committee, is Chairman of Spark Infrastructure, of SunCentral Maroochydore, of the QIMR Berghofer Institute of Medical Research, and is a member of ANU’s Council.
His considerable knowledge of the relationship between the CEO and the board held him in good stead in his new role. “In my 14 years as CEO I worked with three different chairmen. I learnt a lot about being a director from that experience, and a lot about the chair-CEO relationship, which is critical for the successful functioning of a board and a company. I think it’s very important to have some members on a board who have had previous experience in senior management so they can advise in the board’s dealings with executives.”
McTaggart’s own past negotiations as an executive within government organisations, he has found particularly useful in business. His has been an outspoken voice against the political uncertainty surrounding power networks in Australia and the increasing pressure from the Australian Energy Regulator on providers to reduce consumer power prices in a way that is unsustainable for businesses and the market in the long term. “Since working in electricity and finance sectors, the level of regulation has increased significantly. Balancing these obligations off against a board’s direct responsibility to its shareholders can be a challenge.”
Public focus in recent years on the rights and interests of the individual, what McTaggart calls the ‘rise of the consumer’, he considers a very important concern for boards.
He mentions the media spotlight on the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services sector as a part of a broad-based push for boards to justify their social licence to operate, to meet the expectations and demands of both regulators and the community. “The consumer and the seller have a natural, inevitable conflict. The seller wants to sell for a higher profit and the consumer will always want to pay less. This means the consumer/company interaction will always be conflicted – the difficult problem is to find the right balance.”
It is the successful negotiation of apparently disparate interests that McTaggart considers the most rewarding parts of his directorship career. He says, “When I joined the board of Spark Infrastructure as chairman, investors were more unhappy about strategy execution than remuneration, and the board received a strike against its Remuneration Report. We had some very vocal activist investors. Hearing the concerns of all the stakeholders and realigning the path of the organisation’s strategy was something of which I’m particularly proud.”
More recently, McTaggart has been increasingly involved in Indigenous affairs. He has advised the Indigenous Land Corporation (ILC) on investment strategy, and is currently a member of the Expert Advisory Panel on Indigenous Home Ownership Capital Funding. “[They] both promote Indigenous entrepreneurship. I find their work fascinating – it’s very exciting to watch Indigenous businesses develop.”
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