Sustainable leadership at the UN Global Compact Network Australia

UN Global Compact Network Australia executive director Kate Dundas and chair Fiona Reynolds FAICD are in sync for a new round of strategic planning to dovetail with international sustainability goals.

When two leaders of the UN Global Compact Network Australia (UNGCNA) stepped down in quick succession, incoming chair Fiona Reynolds was determined to turn a potential crisis into an opportunity.

The departure of previous chair Dr David Cooke GAICD in November 2022, followed by the resignation of executive director Kylie Porter GAICD a month later, left Reynolds grappling with how to shore up corporate history and ensure business continuity.

While she pulled together an interim leadership team from the organisation’s 10 employees, she knew that recruiting an executive director would be tough in an economy close to full employment, particularly when, she says, “everyone wants to hire sustainability people”.

Looking for gold

The successful candidate would be charged with overseeing the Australian network of the UN Global Compact (UNGC), a membership organisation with more than 250 local participants, including a growing base of small and medium-sized enterprises.

The UNGC was founded in July 2000. An initiative of the UN Secretary-General, it aims to empower business to act responsibly, set an example and create a sustainable future by providing a platform for dialogue, learning, influence and action.

The Australian branch produces events, programs, publications and podcasts, which are designed to accelerate transformational change in organisations. It is one of 65 networks around the world that function at a national level.

The UNGC calls for companies to align their strategies and operations with 10 universal principles relating to human rights, labour, the environment and anti-corruption. It also seeks the implementation of the 17 UN Sustainable Development Goals from the 2030 Agenda for Sustainable Development, adopted by all UN member states in 2015.

Built on the principle of “leave no one behind”, the agenda emphasises a holistic approach to achieving sustainable development for all. Goals include eliminating poverty, gender equality, clean water and sanitation, affordable and clean energy, and climate action.

The UNGCNA includes more than 50 listed companies as well as other businesses, NFPs and universities. Key members include Australia Post, Brambles, Qantas Airways, Stockland, Telstra, Treasury Wine Estates, Wesfarmers Group and Woolworths Group. Its mission is to connect, enable and lead businesses and stakeholders to help them create a sustainable future.

“We had to spring into action fairly quickly, but we also didn’t want to rush,” says Reynolds.

She rallied nine members of the UNGCNA board and, making the task a top priority, enlisted a recruitment firm and cast a wide net. After a four-month executive search process, which drew close to 300 applicants, the UNGCNA appointed Kate Dundas as the new executive director.

“It was quite a long process and I was really pleased that the board stepped up on the issue to make sure that it didn’t get drawn out longer,” says Reynolds. Given that a new round of strategic planning designed to dovetail with international goals is imminent, Dundas’ appointment was timely.

“One of her first priorities will be getting out and talking to members — both large ASX corporations and SMEs — and understanding what they need from UNGCNA,” says Reynolds.

Board backing

Dundas, who has held executive-level positions across local/state government and the private sector, including at the City of Melbourne, was acting COO at Sustainability Victoria.

“It was a busy job that I was loving at the time, and I wasn’t desperately looking to leave,” says Dundas. “[The lengthy selection process] felt appropriate given the complexity of the situation and [that] it was a fairly new board, making the most important decision they have had to make. I certainly had empathy and understanding for [their] making sure that they made the right choice. It’s a great way to start a new job, knowing that there was a consensus decision and I could go in with the confidence of the board.”

One of the key challenges ahead will be looking at ways to improve Australia’s performance against the UN Sustainable Development Goals approaching the halfway point of the 2030 deadline.

“Australia’s doing well in some areas, such as ‘no poverty’, for example, but we’re doing very badly on ‘climate action’, so we have a lot of catching up to do,” says Dundas. “We need to make it easy to make the right decisions and make sure Australian businesses can embed sustainability into their core strategy, into their purpose and into their operations. It’s possible to shape business to make good profits and have really great outcomes for people and the planet.”

There are signs the dial is moving. “Purpose-driven businesses are the ones attracting the best talent at the moment, and that’s only going to continue,” she notes.

Dundas has technical skills in strategic planning, as well as broad expertise across sustainability, the circular economy and business strategy and partnerships, plus a keen interest in contemporary governance.

She has held several non-executive director positions, including at Montsalvat and as the founder of 3000acres, a social enterprise that aims to unlock under-utilised land across Melbourne to grow food and build strong communities. The importance of shared purpose and psychological safety are among the lessons she’s learned from her previous roles.

“Shared purpose is fairly easy to get to when you’re working in a purpose-driven organisation,” she says. “I do like to use long-term thinking to create a shared vision and get everybody on board with that. Psychological safety is also critical and to achieve that I try to model authenticity by bringing my whole self to work, having brave conversations and creating a culture of feedback.”

Dundas’ appointment followed the announcement of new additions to the board, including ESG leaders Susan Mizrahi AAICD, Sunita Gloster AM GAICD and Robin Mellon, who joined in March 2023 and brings to the UNGCNA his expertise in corporate responsibility, sustainable supply chains, marketing and diversity.

Finding a new executive director at UNGCNA

The board worked through a series of steps to ensure it appointed the right candidate. Chair Fiona Reynolds FAICD shares the process.

• Develop a wish list: The new leader doesn’t have to be a carbon copy of the previous one. Consider what skills are needed to take the organisation into the future. “The first thing we did was to look at where the Global Compact was in Australia and where we wanted to go. We really wanted to be clear about our direction first.”
• Delegate where you can: As a small organisation with a noncompensated board, it was not feasible for the directors or interim leadership team to manage an executive search without support. A recruiting firm launched the search and created a long list of applicants. “We devised a vetting system for them in terms of the things we wanted.”
• Form a subcommittee: Although the whole board contributed to consolidating the wish list, a smaller subcommittee was tasked with evaluating the long list and the shortlist. The entire board conducted final interviews with three candidates. “We wanted it to be quite a consensus view, so the board gets behind the success of the candidate.”
• Remain flexible, creative and open: Given the organisation’s sustainability focus, some board members leaned towards applicants with a corporate sustainability background. But the successful candidate needed a wider range of hands-on skills. “We were looking for a lot in the one person and we had to be realistic that one single person can’t tick every box. What it came down to in the end was asking who had the best mix of skills we wanted.”

Modern slavery transparency

How ready is your board for any changes that might come from the independent review?

The Modern Slavery Act 2018 (Cth) has been in operation for three years and an independent review, led by Professor John McMillan AO, was tabled in parliament in May.

Its final report identifies that the standard of modern slavery reporting is variable, the reporting obligation is not properly enforceable, and the process is at risk of being drowned by a sea of large and incompatible statements.

There are 30 recommendations for government to consider, including:

• Lowering the reporting threshold from $100m to $50m annual turnover
• Expanding mandatory reporting criteria
• Requiring due diligence systems to be implemented that go beyond reporting 
• Introducing penalties for non-compliance
• Establishing a Commonwealth Anti-Slavery Commissioner.

The review’s recommendations remain subject to government consideration, but it is timely for boards to consider if their organisations are prepared for these changes.

Some questions for directors to consider include:

● Will your organisation be subject to the modern slavery reporting regime if a lowered reporting threshold ($50m to $100m) is adopted?
● Do you have a due diligence system in place to identify and mitigate the risks of modern slavery practices in your operations and supply chains?
● How extensive is your internal and external consultation on modern slavery risk management?
● Do you make grievance and complaint mechanisms available to support modern slavery risk identification?
● How are you assessing the effectiveness of your modern slavery risk management?

This article first appeared under the headline 'Driving sustainable leadership’ in the August 2023 issue of Company Director magazine.