Boardroom Confidential with Lawrence Goldstone

LAWRENCE GOLDSTONE

Hello and welcome to Boardroom Confidential. The podcast from the Australian Institute of Company Directors. I'm very nice and thanks very much for joining us. I'm pleased to say our guest this time is Lawrence Goldstone. He's the chair of Australia's largest food rescue organisation, OzHarvest plus the founder and co-CEO of boutique agency and consultancy Be Luminous. Lawrence Goldstone also had several board positions and previously held a number of senior roles with PwC, including Lead Partner, Future of Work. Before that, he was the co-founder of The Difference, which he then sold to PwC. Lawrence, thanks so much for joining us.

LAWRENCE GOLDSTONE

Thank you very much for having me.

BENNETT MASON

Let's start with Be Luminous. What inspired you to found the company and what is Be Luminous trying to achieve?

LAWRENCE GOLDSTONE

Well, it's probably the perfect blend of timing, some entrepreneurial drive and to be honest, some favourable market conditions that made us feel that the time was right to be able to go again. We've been able to springboard into the market with some great clients, A wonderful team. And notwithstanding the challenges that I know are out in parts of the market, I find it a really super exciting time to be doing the work that we do. We're a people experience company at heart.

We work with organisations that have large workforces doing complex change or wanting to inspire movements to be able to work in different ways, ignite passion, create impactful experiences and moments. That's the work that we spent a career doing. It's the business that I've set up before and sold before. And so, the time felt right to go again.

LAWRENCE GOLDSTONE

The best quotes I heard recently from one of our clients was that: “You are an antidote to inertia.” Which I thought was really quite beautiful and summed up a little bit around disruptive intent meets the ability to deliver with impact. And so, yeah, time felt right to do something different again.

BENNETT MASON

What's a typical issue or challenge or problem that one of your clients might come to you with? And how do you help them?

LAWRENCE GOLDSTONE

I often work with new CEOs, CEOs coming in, and there's no shortage of those in the market at the moment. Who want to align around a new vision, a new identity and bring the organisation on the journey with them. And that goes from leaders all the way through often to front line. To connect and inspire around who we are, where we're going, what the plan is, and to reinject some energy and commitment back in for whatever reason that may be. It may be because of a want to shift from where we've come from. It could be to inspire a future where we're going to, but it's to connect a system, to connect it differently, to drive it with impact, to bring some creativity, to do things a little bit different. And so that energy and motivation piece is often really key within that.

BENNETT MASON

Pleased to hear it. That's one of your current roles. Another one is at OzHarvest where you're the chair. Now, OzHarvest is, as I said in the intro, Australia's biggest food rescue organisation. A lot of our listeners will already be familiar with them already and the work they do. But can you quickly explain what OzHarvest does and why the model has been so successful?

LAWRENCE GOLDSTONE

Absolutely. Look at its core, OzHarvest collects quality surplus food that would otherwise go to waste. We deliver it free of charge to charities who support people in need. We're probably best known for the yellow vans that people see across all major capital cities, across the country. We collect about 250 tonnes of food every week that would otherwise go to waste, feeding that to over 2,500 food donors, and over 1,500 charities. The waste facts in this country are pretty staggering. With 3.4 million households suffering from food insecurity. So, we have a real systemic challenge. Unfortunately, in this country, and OzHarvest is one of a number of organisations that does incredible work, in this space. Food rescue isn't the only thing that we do. So around rescuing food is obviously the core, it’s where the biggest impact comes from. But we also drive innovation programs. We do education programs, and we do lots of work with corporates and other organisations to drive advocacy and impact policy change.

BENNETT MASON

You've been on the board there at OzHarvest for a while, and as we said, now you're the chair. But what made you want to join the board of OzHarvest? What made it so rewarding?

LAWRENCE GOLDSTONE

I was first introduced to OzHarvest back in 2009, actually. I ended up doing some work with them, with their original board and with Ronni Kahn as CEO and founder. And for those that have met Ronni, once you're in the vortex of Ronni, and of OzHarvest, it's very difficult for you to move away. I ended up helping them with their strategy, getting further involved in the organisation., developing that purpose, and vision. And then ended up being, on the subcommittee for the strategy subcommittee and subsequently joining the board. Never looked back. You end up bleeding yellow. And it's a real privilege to be a part of an organisation that drives such impact and is so purpose driven and mission, aligned. Every single person that, works for the organisation or the 3,000 incredible volunteers that give their time to the organisation, the wonderful supporters that help us to do what we do. It really is an incredible force for good. It's an absolute privilege to be involved and to be able to bring my skills and those of my network to play.

BENNETT MASON

You mentioned Ronni Khan a moment ago, the OzHarvest founder. This has been a time of great change for OzHarvest, because Ronni is transitioning away from being CEO to another role of the organisation. There's a new chief executive, James Goth. So how did you and the board work with Ronni and work with James to ensure a successful and smooth CEO transition?

LAWRENCE GOLDSTONE

Well, first off, it wasn't a quick conversation or something that happened overnight. This has been something that Ronni and I have talked through for many years. It was actually one of the conversations we had when I was asked to take on the role of chair. We recently just celebrated our 20th year. Ronni, that's 20 years having been a founder CEO. The organisation has grown. And there's a lot more impact that we know that Ronni wants to be able to drive and give. So, the question was how do we transition the organisation to set itself up for the next 5 to 10 years whilst unleashing all the amazing impact, relationships, and energy that Ronni has to still drive change in this space? And so, yes, as you said, we brought in a new CEO, in James Goth, who is a wonderful addition to the team whilst moving and transitioning Ronni into a wonderfully titled role of “visionary in residence”, which allows her to still be the heartbeat culturally of the organisation and a visionary for change in the sector and in this space. We may touch on it a little bit later, but we also over the past five years or so, have been playing with an innovation model called OzHarvest ventures. Which is how do we disrupt our own innovation model and create new sustainable sources of revenue outside of our traditional core supporters? And this allows Ronni also to lean more into the innovation space, with different resources and the ability to affect and impact change.

BENNETT MASON

Let's just stick with Ronni and the board’s relationship with her for a moment. Ronni is extremely well known by many Australians. She's certainly identified with OzHarvest. Working with a founder can be challenging for many boards. Whether it's a for profit enterprise or an NFP. But OzHarvest seems to have had a very successful relationship with the founder and the board. So, what advice would you have? What guidance would you have for other directors who are looking to also have that successful collaborative relationship with a founder?

LAWRENCE GOLDSTONE

I don't think it's rocket science. I think it comes down to core principles of a strong and respectful relationship built on trust, respect, and a healthy tension and ability to have good, challenging conversations when they arise. For any chair who is working with a co-founder, I think empathy is a really big component of understanding where they're coming from. The business that they built and that they've put all of their time into, balanced with the role of the board and why we have a board, especially in the not-for-profit space. Probably more so, given many founder-led organisations, we’re all going to have to move through things like CEO succession planning and planning for the next period after. Doing it “with” not “to” is by far the most important way of approaching a CEO's succession. Being able to do it in a caring way, in a way that's authentic, that's open with the organisation, with the individual, is what has set us up for success. But I've had a wonderful relationship with Ronni, all the way through. There are times that we disagree. But in a very healthy way. We speak often across many different things When she was CEO. And I do so with James now and Ronni in her new role. And it's a wonderful relationship. I think maybe it is the best of all worlds where we have now a CEO, a visionary in residence and a chair that all have slightly different perspectives, but all mission aligned to what it is that we're looking to create together that.

BENNETT MASON

CEO succession and leadership transition is a big issue for the board to deal with. But I'm sure it's not the only one. What are some other, opportunities and challenges that the OzHarvest board is grappling with right now?

LAWRENCE GOLDSTONE

Sadly, in a country that has so much abundance and supply, our biggest opportunity is scale. Food waste in Australia is a $36 billion problem. As I said before, with 3.4 million households experiencing food insecurity. So, we're only scratching the surface. The need is sadly growing faster than our capacity and that of other organisations in this space Being able to offer support. So how do we scale our impact? Whether that's through better use of technology, connecting different parts of the ecosystem together, collaborating differently into new regions and sectors, that's a huge part. Scale, as you can imagine, for an organisation like ours, leaning into the impact of the size of problem that we have. Sustainability is also a huge challenge, not just environmental, but financial. As we grow, we need to ensure our funding models can keep pace. That's why I mentioned before we set up the ventures business to disrupt our own funding sources to play longer term, rather than just the short term in year, how do we hit on numbers. But to really look across the horizon 2 and horizon 3 around how do we build long term sustainable new revenue streams that allow us to be able to drive the impact that we know is so desperately needed.

BENNETT MASON

You talked about financial issues at OzHarvest. How does the board balance that? It's been a complex time for the economy over the last five years. Government funding, private donations, all those things have been under pressure. How does the board balance financial governance with OzHarvest’s social and environmental purpose?

LAWRENCE GOLDSTONE

I think this is at the heart of what makes it a really challenging role, in balancing, a social purpose organisation, that has a mission to be able to deliver impact, but with financial sustainability at the other side, when, like most charities, funding sources fluctuate, they have changed. We don't rely significantly on government funds. So, annuity isn't there for us quite in the same way as with other organisations. So, diversifying our revenue streams is a priority, assessing major decisions against our mission, not just around affordability, but around the impact. And having a very clear strategy to know where we are placing a dollar and taking the responsibility that we use every dollar wisely. Within our organisation, for every dollar that is donated to meals are able to be delivered at source to individuals most in need. I also think that metric which is something that's been really important for us to constantly maintain and strive to ensure, is at the heart of why, OzHarvest has been successful and has such a variety of corporate, philanthropic donors, as well as individual and recurring givers, as well as across our mix of sources, is that we can see direct impact. That when I put that dollar in, I can see the two meals go out to those in need. I think the simplicity of that model is really key. But you're absolutely right. When you use that word balance, it is a balance. And finding those new sustainable sources is constantly the goal of what we look to do, whether that be through partnerships or exciting new opportunities like the ventures business.

BENNETT MASON

Can you talk a bit more about the ventures business? What are you trying to achieve there?

LAWRENCE GOLDSTONE

I think I use the that the term before, which is sustainable new sources of revenue, longer term. So, it is set up as a separate entity. It is mission-aligned, but it is a separate organisation, separate structure that is set up to create new opportunities that disrupt food supply chains, or invest in new technologies, ultimately that will create products or create relationships or create impact and allow us to take new revenue streams from the venture's business back over to OzHarvest. An example of that, we have a number of products that we've used, waste ingredients to create a lemonade, a conscious drink, in partnership with wonderful Kakadu Kitchen. And these products are available for consumer purchase, and we’d look to expand that range. We recently also acquired a wonderful high end corporate catering business, by the name of Gastronomy, plug out for anyone who wants a new mission, social purpose aligned corporate caterer that offers the very, very best, service, creativity, and product and cool catering, but with a socially aligned purpose that knows that all profits from that organisation go back into an organisation like OzHarvest.  So, disrupting the traditional, product with purpose, decisioning certainly into the corporate space, is something that we'd like to be able to do a little bit more of.

BENNETT MASON

Let's move away from OzHarvest. You used that word “disrupting” a moment ago. Disruption, innovation, that's an area that you've been very passionate about. You've worked on disruption for a long time. What do you think are some entrenched systems, especially in corporate Australia, that you think need a fundamental rethink? That need a disruption?

LAWRENCE GOLDSTONE

I've had the absolute privilege to have a career that spans multiple, countries, varying different industries and organisations. So, take this as an amalgamation of some of those learnings. The entrenched way that we still drive, I think, some old fashioned, almost institutional methods of engagement and communication within organisations, still amazes me. The lack of investment in how we engage people. Our most important asset most of the time inside major organisations. How we approach skilling, reskilling and capability building specifically around what I would call the soft skills or human skills, those core skills, not the technical ones, that allow individuals to thrive. Not later in career, where they become the domain often of the senior executive. But early in career, where we really set people up for the next decades of their corporate work life and that investment in those human skills around resilience, capability, creativity, problem solving, looking after yourself to get the best out of your body and mind, not just to be able to get and deliver the best within work. And I think our workspaces, I think the places in which we work. Hot topic for the last few years, of course, certainly needs a little bit of a rethink, not wanting to get anywhere near the work from home debate. But the intentional design, both in how, where and when we work, is certainly one that I think has some opportunities within it to still get right. And I think we're still learning what that looks like at the moment.

BENNETT MASON

I'll try to pin you down on a few of those, including work from home. The first issue you mentioned was communication, the way organisations communicate internally. What are they getting wrong and how do they fix it?

LAWRENCE GOLDSTONE

We still tend to be very driven by channel push, email and web-based techniques. Yet in our own worlds, we are all consumed with media in a very different way. And so have we been a bit slow in our organisations, sometimes a little bit slow to adopt and to find new ways to drive engagement. To be able to bring people on the journey, sometimes slow down to speed up. I definitely think there are opportunities there in the way that we communicate and engage.

BENNETT MASON

You said you didn't want to get into the work from home debate, but the discussion has been ongoing. We don't need to go too much into that in particular. But you talked about redesigning workspaces. How should organisations, how should employers think about that?

LAWRENCE GOLDSTONE

I will probably preface this with, I don't think there has ever been a more complex time for leaders, managers, leaders, those in positions of responsibility, to have to deal with the modern workforce. Both in the hybrid conversation, remote, wellbeing, performance, productivity, matched with still being able to deliver your own work quite often and looking after yourself and trying to balance the amount of hours in the day. I think it is complex, very, very complex. There's no one size fits all to this. Those that I've seen get it right, understand what it is that they do. Understand the people that they have and how best to get productive work. This isn't a new debate. That's the other thing that this is. It's come to the fore very much in a post-pandemic world, where the pendulum swung massively towards a new and a different way of working. Obviously, when we all had to - not all. Those in knowledge, worker based, businesses, certainly Changed quite quickly their ways of working. And it's retreating back at the moment. And so, this debate about days in, days out where culture is best built. It really depends on the organisation that you're in., there are fabulous examples of distributed work groups that work in multinational environments that have really strong cultures, very aligned to purpose and work exceptionally well. I don't think there is anything around a one size fits all model other than the premise of what's right for the organisation. I do believe that collaboration, connectivity, the unexpected conversations definitely happen Best in a face-to-face environment. I am absolutely a proponent of That. Does that have to happen five days a week. Of course it doesn't. It never used to. And so, dictating that I'm not a fan of. However, creating intentional opportunities for people to collaborate, to connect, to engage, to have social cohesion, the intentional design of those is what feels like it's sometimes missing. And what I mean by the intentional design is creating moments whereby we cultivate things that need to happen together, rather than relying on them to just happen.

BENNETT MASON

What's the role of the board in designing that system of work? Should the board be involved in that, or is it best led to management?

LAWRENCE GOLDSTONE

I think ultimately, it's best left to management. But boards, have a role to play in ensuring that the conversations that need to happen are happening, that we are not just retreating, that we're using the data available to us and that we're stretching our thinking and bringing in new perspectives and being able to challenge that back. I think there is a strong role for the board, obviously, within bringing diverse perspectives and new perspectives and challenge, especially where we don't see change and the data is screaming out that change is required.

BENNETT MASON

What sort of data, what metrics should boards be looking at on both ways of work and also on culture more broadly?

LAWRENCE GOLDSTONE

That’s a very hard one to answer.

BENNETT MASON

I could phrase it differently?

LAWRENCE GOLDSTONE

No, it's not the phraseology. There are a number of traditional data sources available That board should be looking at and will be looking at. Whether they be engagement, whether they be culture, whether they be absenteeism. There are a number of sources of data that for sure will be reported on. I think the question is more around creating opportunities to explore what else can be done and the “what isn't being reported?”. I am not a fan of the surveillance state that we find ourselves sort of moving towards in the using technology to manage productivity and performance. I understand where that's come from, but I think boards need to interrogate data and be able to have more conversations with leaders around where we're aiming to be, where we want to be, what the employee value proposition should be, what great looks like. Not just reporting on how many clicks in and clicks out we've got, because that doesn't talk to productivity.

BENNETT MASON

A lot of what we've been discussing is linked to culture, and we know the boards have a strong role in, we call it “setting the tone from the top” but then providing oversight of that culture. Aside from the data, the numbers, the metrics, how else can a board really know what's going on with their organisation? How can they get a sense of the culture?

LAWRENCE GOLDSTONE

The way that we onboard, certainly the way that I've seen onboarding of directors. Let me go to OzHarvest. The way that we onboard new directors into the organisation is to go and experience the organisation. Shopfront or in a van, right? Go and meet our wonderful people who drive the vans. Go and see the surplus food being picked up. Go and experience what that feels and looks like as it's donated to recipients. I don't think that's that different to any organisation that on boards directors. You have to understand the organisation away from the board reports to understand what the essence of the organisation is, what it is that they do, and to experience it firsthand. Through those conversations I think you'll get a better view as to the essence and the sort of intangibles that don't come through necessarily as we're reporting up aggregated information. Conversations are always going to be the key to that, being able to bring those diverse perspectives across the organisation, from other industries and bring new perspectives to the boardroom. That is absolutely one other way of being able to build curiosity, to be able to consider new models, and to be able to have the right conversations.

BENNETT MASON

I want to move to, I guess, strategy now in the boardroom. Boards have a key role in promoting innovation and growth at their organisations. How do you think boards can best create the conditions for innovation and foster growth?

LAWRENCE GOLDSTONE

I think you mentioned it before. The boards set the mindset away from traditional governance approaches for innovation. Psychological safety and the ability to be able to have good conversations and be able to create and foster an environment that allows conversations around innovation to take place. I think it's not enough to say innovation is important. It’s about dedicating resources to it and being able to support that. I use the word “curiosity” before.  I think, the curiosity of boards to be able to ask what is happening and move away from just reporting mechanisms around new processes that are happening, but engage in a real conversation around innovation, around why, around what we're doing and how else we would be able to drive. The best innovation that I've seen, often is small experiments, small teams trying to do things differently as well as the large-scale disruptive innovation that has to happen across organisations. And so being able to foster that and having the curiosity to even elevate some of those positions back up to the board also are really good examples of where we've seen that work.

BENNETT MASON

We live in this time of great disruption, volatility, often uncertainty. You work very closely with boards and executive teams. What qualities or skills do you think we need from our leaders going forward, whether they be boards or what should directors be looking for in their executives.

LAWRENCE GOLDSTONE

In their executives or around the border?

BENNETT MASON

Both?

LAWRENCE GOLDSTONE

Diversity of thought. I think there's an opportunity for more skills, new skills to come into the boardroom, whether that be in the dedicated role through directors or in the access that we provide to others around organisations to bring in new perspectives. Agility and curiosity, to seek out more information around the why as well as the why not. And probably more constructive challenge. We've got to create the space for that, that doesn't fit into 30-minute updates. And so, the constructive challenge, the ability to explore new opportunities, sometimes it requires a creation of space to be able to really, truly think through what opportunities exist and where we create the space for fresh ideas, and for new people to be able to be brought into that. And that's a requirement for both boards, but also for executives. But combining the two. Absolutely.

BENNETT MASON

I want to end with a few questions on transformations, because you've helped a lot of organisations go through a successful transformation. Whether a transformation is very big, very complex or very small, where do organisations most often go right and where do they go wrong?

LAWRENCE GOLDSTONE

So, if I think where the organisations go right, they spend the time creating the clarity of the “why” before moving into the “how.” They spend the time investing in leadership and leader alignment and truly exploring options before they move into the implementation. Anything that's transforming takes time, obviously. The challenge often is the desire for quick results. The challenge often is in the clarity and certainty around leadership alignment to a common purpose, common outcome, a common “why”. So, it's more than just communicating the change, but it's properly investing in the destination and the approach and the how we're going to make this different. So, all of that is spend the time upfront sharpening the axe before you start chopping down the tree, I guess, is the is the point that I'm getting to.

BENNETT MASON

When you talk about investing, is that investing time? Is it capital allocation? What is it?

LAWRENCE GOLDSTONE

I’d definitely say time. Capital allocation will always be applied to whatever transformative change, whether it be system, process, people. The time to do it well, the time to do it right, the time to engage and communicate, is where I think the overinvestment or currently the underinvestment, is playing out. That creates challenge that you end up playing catch-up to later on in transformations or in large programmes of change. So, spending that time communicating widely and broadly, communicating with transparency, bringing leaders on the journey, bringing the whole organisation on the journey, setting and inspiring, insight as to where we're moving towards these. These are all facets and components that we know, but often we become very rational in the way that we set the timeline and start to drive communication and engagement. And all the way back to the beginning of this conversation when we talked about things that need to be done differently, engaging well, engaging differently, communicating well and communicating differently, it probably comes all the way back to that point. I think that's where the essence of this really sits in transformations that I've seen done really well and transformations I've seen not go so well.

BENNETT MASON

A lot of organisations go through many changes, many transformations. They might be change fatigued, they might be risk adverse. So how can boards and senior leaders encourage those organisations to pursue innovation or a transformation?

LAWRENCE GOLDSTONE

It's a constant as we know everything will evolve. Everything will change. It's as certain as you're going to get within any context. Yes, change fatigue because the pace of change has never been as great as it is today and will only get faster and quicker. And I would say that for those that are, does it mean you turn off the tap? It just means you need to think of different ways of approaching. If I think about innovation before, the scaffolding of establishing small spaces for experimentation and being able to create the capacity to enable small groups to really tackle a system before expanding that out and sharing those learnings is one way of ensuring that an organisation’s still got the heartbeat of driving change and innovation, whilst not looking to do any more That adds to the whole. I think there's also an overuse of the word “change fatigue.” I think we may be fatigued in this because we keep doing it in the same way and expecting different results. I do think there is a need for a more exciting, inspiring, creative way of being able to bring our employee bases on the journey with us and to be a part of it, not just as a consumer, but a true producer. The ability to get our fingerprints as individuals in a company into designing and having a say in where we're heading to sometimes is missed. We may rely on smaller groups or decisions made by smaller committees before believing that we have the right answer and not necessarily spending the time well, early on to engage more broadly and in a different way.

BENNETT MASON

Sometimes a transformation or a change won't be successful, or at least not straight away. When is the right time to pause or even stop a transformation? What sort of warning signs should a board be looking for?

LAWRENCE GOLDSTONE

Well, when your scorecard’s flashing ambers and reds, I think you pretty much know. if you're close enough, and I imagine most transformations are. obviously, we report, and any board will take reporting metrics as the signals. But by the time it's reported up, I would say you already missed the weak signals that are coming through. Getting close to the ground and getting the real information through is the key to ensuring that there's no just sort of blind optimism to continuing. But if you're talking about big transformations, they’re multi-year and multifaceted. Being able to have the right conversations with the right people at the right time, consistently being able to have a good space for real conversations, to be able to really pull apart what is happening, what isn't going well and not leaving it till the end. So really good principles and processes are always going to be key to that. Where the board comes into that, I think again, is back to the curiosity to ask the right questions, to interrogate the data in the right ways, and to be able to bring different people into the boardroom to share the conversations and to be able to have time. Time to be able to have the right discussion and time to put the right checks and balances in place.

BENNETT MASON

Lawrence, we’ll wrap things there. You’ve had some great advice. Thanks for joining us.