Company director rankings: Top and bottom three revealed

Meet the three top New Zealand directors - and the trio who occupy positions 31, 32 and 33. We reveal why two of those at the bottom of the list have a common company to blame for their ranking.

SAM KNOWLES

RANK:

1st / 33

ANNUAL RETURNS RELATIVE TO NZX:

+37.4 per cent

CURRENT NZX APPOINTMENTS:

Synlait, Trustpower

BEST RUN:

Xero (chair), Dec 2010-Feb 2014, annual returns 130.5 percentage points above NZX mean

WORST RUN:

SLI Systems, April 2013-Oct 2015, annual returns 47.4 percentage points below NZX mean

Sam Knowles wasn't quite sure how to respond when the Herald called to tell him he'd topped the table and was crowned New Zealand's director of the decade.

"It's probably an accolade I don't deserve. It's probably just good fortune," he says.

The founding chief executive of KiwiBank, he's kept track of bottom shareholder value line in organisations he's worked with.

"I do track that, but know that some is serendipity - timing - of when you're in and out," he says.

And there's no greater serendipity in the New Zealand market over the past decade than being part of the singular surge of accountancy software firm Xero. During his three years on the board, a large chunk as chairman, the company more than octupled in value.

"I guess I came in at a time when Xero was, not struggling, but finding its feet," he says, noting it was yet to develop significant sales channels outside New Zealand. His focus during that time was baking-in corporate process for a medium-sized company that was need to quickly grow into a large corporate.

(Story continues beneath the graphic below.)

You can explore the rankings in our interactive data visualisation below. Each chart shows the shareholder returns (red line) compared with the middle 50% of NZX companies (shown in grey) when the director was on the board of that company.

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Knowles sees his particular skills as understanding the role of the chief executive - having worn those shoes himself - and knowing how to build organisations. He bills himself as a specialist in "growth company governance". Unusually for a professional director, he is based outside Auckland, in Wellington, and is realistic enough to almost admit fallibility.

"I'm not saying I was wrong. Information I had then said it was the right thing to do, but I pushed back about not making a particular acquisition - I can't go public on what this was - but it was later proved the organisation would've made a lot of money if they'd not listened to me."

JULIA HOARE

RANK:

2nd / 33

ANNUAL RETURNS RELATIVE TO NZX:

+32.2 per cent

CURRENT NZX APPOINTMENTS:

a2 Milk (deputy chair), Auckland International Airport, AWF Madison, Port of Tauranga

BEST RUN:

a2 Milk (deputy chair), Nov 2013-present, annual returns 97.3 percentage points above NZX mean

WORST RUN:

AWF Madison, Oct 2013-present, annual returns 7.7 percentage points below NZX mean

Julia Hoare remembers being criticised while at a2 milk as the dairy food tech firm appeared to let opportunity go to waste as it regularly ran out of inventory.

"When I came on board we were just sending our first shipment of formula to China," she says.

This issue was a vexing one, but not unplanned.

"It's important as a director to make sure I'm not acting as a handbrake - you don't want to slow growth, but you also don't want uncontrolled growth.

"We'd made decisions where we'd probably not produced enough inventory, but in the knowledge that the growth we're having is sustainable."

The growing pains have now eased, she's now the company's longest-serving director and deputy chair, and a2 is the biggest recent success on the NZX having - on average - doubled in value in each of the five years she's been on the board.

Hoard had got into the corporate governance game full time in 2012 after a 20-year run as partner with PWC where she had specialised in tax and sustainability issues.

"Coming from the adviser space, as opposed to a general corporate space, means I'm very used to switching from one business to another," she says of her career change.

Aside from her four posts on companies listed on the NZX, Hoare has a full plate of appointments including New Zealand Post, Watercare and the Institute of Directors.

GRÁINNE TROUTE

RANK:

3rd / 33

ANNUAL RETURNS RELATIVE TO NZX:

+19.9 per cent

CURRENT NZX APPOINTMENTS:

Evolve Education, Investore Property, Tourism Holdings, Summerset

BEST RUN:

Tourism Holdings, Feb 2015-present, annual returns 47.1 percentage points above NZX mean

WORST RUN:

Evolve Education, May 2017-present, annual returns 34.2 percentage points below NZX mean

Gráinne Troute, only two and a half years into her stint in governance, is one of the freshest faces on the NZX boardroom block and admits "on one level, I'm a bit embarrassed to be on this list".

She got her break four years ago while GM of corporate services at SkyCity, having previously headed up McDonald's in New Zealand, when casino director Rob Campbell shoulder-tapped her to join him on the board of Tourism Holdings.

"There's a huge amount of luck here, and my result is heavily weighted by Tourism Holdings. While I'm proud of that, it's important to note that there's a correlation but I wouldn't draw any causation."

She says her experience in retail and tourism, and leading large customer-facing workforces, have held in her good stead. The main lesson she's learned in the past few years is trying to look past short-term measures and to be future-focused.

"You talk about it, but you try to focus on what's best for the business - the business performance, rather than what your share price is doing now or next week. It's always there, you never get away from it, because that's ultimately how you're judged."

MICHAEL STIASSNY

RANK:

31st / 33

ANNUAL RETURNS RELATIVE TO NZX:

-7.3 per cent

CURRENT NZX APPOINTMENTS:

Tower (chair)

BEST RUN:

Stride, April 2010-Aug 2018, annual returns 10.4 percentage points above NZX mean

WORST RUN:

NZ Windfarms, Jan 2009-Nov 2015, annual returns 32.4 percentage points below NZX mean

Michael Staissny is among the highest-profile business-people in New Zealand, having overseen the country's highest-profile insolvency administrations (the Crafar Farms, MediaWorks), public and iwi bodies (Ngāti Whātua, the New Zealand Transport Agency) and companies (Tower, and until recently, Vector).

But with his messy ouster from Vector, and a decade of sub-par results on the NZX highlighted by the albatross of Windfarms, is his star dimming?

Stiassny, who by reputation is more likely to club opponents in the face than stab them in the back, acknowledges the numbers don't look good, but says that's to be expected given his oeuvre.

"To be honest, people will come to me; they'll come to me when everything's not going swimmingly," he says.

And Windfarms falls into that category, he says.

"There no doubt windfarms are a source of energy, and they should work. And there is also no doubt, in my view, significant issues around their [NZ Windfarms] turbines and the way it was put together that mean it was not an investment made in heaven."

He makes no bones about his lack of specific expertise in the core business of those firms he is involved governing.

"Whilst you can have people who have experience, they also need to be able to not rely on their experience in isolation. The expert is actually as dangerous, in a sense, as the opposite."

KEITH SMITH

RANK:

32nd / 33

ANNUAL RETURNS RELATIVE TO NZX:

-9.9 per cent

CURRENT NZX APPOINTMENTS:

Mercury, Warehouse (deputy chair)

BEST RUN:

Mercury, Jan 2009-present, annual returns 8.2 percentage points above NZX mean

WORST RUN:

NZ Farming Systems Uruguay, Jan 2009-Oct 2010, annual returns 40.5 percentage points below NZX mean

Keith Smith acknowledges he's long in the tooth. He helped Sir Stephen Tindall out with accounting for the first Warehouse in 1982, and today still sits on the board as deputy chair.

"I'm probably one of the old-school directors," he says.

He says he got into the directorship game through his work in insolvency for BDO, and says the board will know if they're doing a good job.

"You always know when something works or something doesn't work. Generally you try to leave a company in a better position than when you joined. Then you've got a whole raft of things that could possibly go wrong," he says.

His tenure with PGG Wrightson and NZ Farming Systems Uruguay co-incided with a horror run for the agri-firms. He put this down to factors outside of his control and says success should be measured by the companies still standing after the storm.

"I started just before the GFC, they're ones that you could say still survived after the GFC. You need a board with scars on their back to see things through. I could've bailed. I didn't. I hung in all the way through."

He's philosophical about the Herald rankings: "Maybe it's good luck. If I'd been on Xero or Ryman or a2, maybe I'd be at the other end of that list."

His present terms as a listed director - at the Warehouse and Mercury - will be his last, he says.

"I'm retiring at that point. I've been around for a long time."

MIKE ALLEN

RANK:

33rd / 33

ANNUAL RETURNS RELATIVE TO NZX:

-15.2 per cent

CURRENT NZX APPOINTMENTS:

Investore Property (chair)

BEST RUN:

Investore Property, Jul 2016-present, annual returns 1.2 percentage points below NZX mean

WORST RUN:

NZ Windfarms, Sep 2010-Mar 2014, annual returns 37.6 percentage points below NZX mean

Mike Allen, an investment banker with significant non-public board posts in Tainui Group Holdings and China Construction Bank, says he has a policy of not talking to media but has some issues around methodology.

"I think all directors are vitally interested in the performance of companies they're on. I think it's unfortunate when you're not prepared to look at outright performance," he says.

He is referring to Coats Group, whose turgid performance on the NZX came to a close in mid-2016 when it transferred to the London Stock Exchange.

It's since tripled in value, a point he is keen to hammer home: "It's the board I spend most of my time on, and it's been incredible successful."

He does however, acknowledge NZ Windfarms - largely responsible for dragging his ranking down - was a far-from-stellar market performer and prefers to let his former boardroom colleague do the talking.

"I'll probably have to agree with Mr Stiassny."

CORRECTION: An earlier version of this article incorrectly listed Mike Allen's directorships as including Mercury NZ. The former director of that company is Michael David Allen, not Michael Nicholas Allen, the subject of this story. The interactive graphic also included a photo of the wrong Michael Allen. The Herald apologises for the error.