Fran O'Sullivan: Big guns hunting for life after Fraser

Wanted: Chairman for TVNZ with sufficient commercial smarts, experience and sheer gall to take on the "poisoned chalice" and get the grunt back into the broadcasting giant.

TVNZ chief executive Ian Fraser's job is not the only high-profile vacancy at the besieged company.

Fraser resigned in a hissy fit over perceived Government interference as the TVNZ board directed management to implement new directives geared at gutting the fat pay packets of high-profile presenters. The board wanted Fraser to micro-manage the pay negotiations.

The board has already started hunting for somebody to replace Fraser.

But with chairman Craig Boyce widely expected not to seek renewal of his own directorship when it expires next April, it is crucial that the Government find an urgent replacement if it is to avoid a repeat of the "Fraser scenario" - where Boyce had to work hand-in-hand with a CEO that he had not directly appointed.

The relationship between a company's chairman and its CEO is far more important than the "board and CEO" relationship which most governance experts bang on about.

Fraser, the liberal sophisticate with huge talents as a presenter himself, was not rated hugely by some TVNZ board members who believed he was a commercial disaster.

His was almost a personal appointment by former TVNZ chairman Ross Armstrong, a close confidant of Prime Minister Helen Clark at that time, to implement a charter which would reintroduce an element of public service broadcasting to TVNZ.

But with the Government now facing an internal debate over whether the commercial and charter models are compatible in one organisation, it is time to ensure the new CEO is appointed by the person who will lead strategy at board level.

This might seem like a suicide mission for any director who has been around the tracks.

But already new director John Goulter, the former Auckland International Airport CEO and a Fraser critic, is positioning himself for the job.

Goulter had been on Fraser's tail for some months over perceived management lapses.

Some TVNZ management felt his presence was "aggressive" but he has clearly been put there by the Government to do a job.

Goulter is not getting hands-on yet.

But, ironically, Fraser's departure has opened the way for the board to become even more operational.

Boyce emailed TVNZ staff on November 3 saying the board had decided not to appoint an acting CEO, but to divide the CEO responsibilities between Stephen Smith, assistant CEO/head of content, and Rodney Parker, chief financial officer/chief operating officer.

"They and Noel Vautier, company secretary, will report to me, as chairman. Stephen Smith will assume the role of editor-in-chief and will, if required, report on these matters to deputy chairman Rob Fenwick.

"Rob Fenwick and I will meet each week with Stephen, Rodney and Noel, and Rob, who is Auckland-based, will be available to work more closely with the business and will represent the company, as required."

There have been suggestions the Government might mount a "clean sweep" of the board after Clark's criticism that TVNZ had the propensity to "be the news rather than simply report it".

But that seems unlikely given it would reek of political interference in the present circumstances.

It is not clear whether Broadcasting Minister Steve Maharey may try to persuade Boyce to stay on beyond April.

Boyce has let it be known to TVNZ insiders that he "can't wait to get off". He does not like the public limelight and is less comfortable being a public face for the company than some of his predecessors such as Rosanne Meo and Norm Geary.

The directors are endeavouring to ensure that open factionalism does not erupt.

Whether it is Boyce - or a successor - the problem is still one of differing expectations between the Government and TVNZ.

Clark reacted aggressively to the John Hawkesby affair and the then TVNZ board was pilloried over the $6 million payout. To the Prime Minister, it was just more evidence of the culture of excess of which she wished to be rid.

But the Government's retaliation went further than mere jaw-boning over salaries that Cabinet ministers (or even PMs) could only dream of.

It is the extent of the Government's retaliation and the ever-increasing bureaucratic environment which purists say add extra difficulty for Government-appointed directors.

In 2002, the Crown Company Monitoring Advisory Unit issued an Owners Expectation Manual which laid down the Government's law. It was tighter than a duck's bum, says one chairman with dual public and private sector roles who was used to a more free-wheeling corporate environment.

The manual received little publicity at the time but it was a marked step away from the relatively hands-off environment in which Government-owned entities were commercialised in the mid-1980s.

TVNZ - which was being prepared for sale under the previous National Government - is among the list of state-owned organisations which qualifies as a Croc (Crown-owned company), rather than an SOE or state-owned enterprise.

The Government believed the manual would help ministers, directors and advisers to operate efficiently in their roles, assisting Crown companies to become successful businesses while observing the social and other obligations to society and the Crown as a whole.

But it was a significant encroachment on the independence state boards had enjoyed up to that point - even curtailing their abilities to explore overseas opportunities without direct shareholder approval.

One of the key issues was the institution of a "no surprises" policy which said shareholding ministers expected Crown company boards to inform the ministers well in advance of anything considered potentially contentious, in the public arena, whether the issue was inside or outside the relevant legislation and/or ownership policy.

TVNZ directors were concerned they were in breach of the "no surprises" policy when news filtered through to them that Close Up presenter Susan Wood was taking legal action over her contract.

The board, even if it had wanted to, could not have told the Government to get lost over Wood's $450,000 salary imbroglio.

In fact, it was duty bound to inform Maharey and his co-shareholding minister, Michael Cullen, in advance of the latest fiasco to dent TVNZ's brand.

Within TVNZ, skilled news staff are fed up with being under media scrutiny and are concerned that the gains they have made are in danger of being washed away.

When the Wood fiasco erupted, Close Up executive producer Paul Patrick emailed his team pointing out that theirs was the most watched programme across all channels at 7pm, pointedly noting that it had "more often than not" double the ratings of TV3's Campbell Live programme.

In Auckland, Close Up outperformed Paul Holmes' ratings for ages 18 to 49 (2003 figures) and almost matched the 25 to 54 figures.

"Nationally this year, Close Up is comfortably ahead of Campbell Live in the 28- 49 demo, which don't forget is TV3's target," said Patrick.

"We are breaking legitimate stories on a consistent basis and getting fresh angles on stories that Campbell Live can't even begin to compete with.

"We are not resorting to foreign fillers like that show (overseas tracks voiced in Australia with Australian currency in the stories) and I can't foresee a time when we will."

However, that is a message that will get lost unless tough action happens - soon.