VOYT KRZYCHYLKIEWICZ CAREER HIGHLIGHTS 

• Top-rated equity analyst covering the banking and general financials sectors in South Africa
• CIO at Rand Merchant Investments, a ZAR$47.5bn listed holding company based in Johannesburg, South Africa
• Experience on 13 public and private company boards across Africa, Europe, and North America
• Founding president of the Young Directors Forum
• Member of CFA Society Toronto and a past member of CFA Society South Africa
  

Why did you launch the Young Directors Forum?
I have been fortunate to serve on many public and private boards through my career. My experience gave me a new appreciation for the importance of effective governance. I found I was able to add significant value to the boards, not only because of my technical expertise but by bringing a younger perspective. It is important to remember most staff and many clients are younger than the average board member. It is hard making decisions about mortgage products if nobody around the table has a mortgage!

When I came to Canada in 2017, I wanted to encourage other younger professionals and entrepreneurs to get more involved in governance. Like me, many young individuals want to have a broader influence on society, and boards are one high-impact way to contribute and shape decisions that affect a wide range of stakeholders.

At the same time, I recognized that diversity was happening too slowly, and we needed to engage and develop future generations of board directors who are more diverse. Governance has an inclusion and access problem, and I wanted to create an organization that gives more people access to basic governance knowledge and a path to getting on boards. It has been rewarding seeing some of our members getting onto boards and starting to have an impact.

You have extensive experience in finance and capital markets. What drew you to corporate governance?
Earlier in my career, I was an equity analyst. While I modelled the last basis point and other metrics, the boards of the companies I covered remained somewhat like black boxes, and it was unclear to me the impact they had. I have come to appreciate, both through my own board experience as well as by witnessing multiple corporate failures, that often an organization’s challenges and success are influenced by the board’s actions or inaction. This obviously does not absolve the executive team or general staff from responsibility, but boards are ultimately accountable to shareholders and stakeholders. They have the power to replace executive teams and redefine strategy. It is a challenging job to do well, particularly in a rapidly changing environment, but there is the potential to add enormous value and impact as a successful board member.

How would you define board diversity?
When people discuss board diversity, most think of demographic diversity—gender and race being two prominent examples. These are important considerations, as there are many groups who are underrepresented that should have a seat at the decision-making table. Board diversity should also consider cognitive diversity by bringing together people who have different backgrounds, experience, knowledge, skills, and approaches.

How does board diversity benefit an organization?
There is a strong business case for diversity. Governance is the process of how organizations make decisions, and boards are just one of the “governance systems.” Traditionally, boards have focused on getting members with significant experience who have dealt with similar issues before—hence the historic preference for retired executives. Having the right answers only matters if you ask the right questions, and this is where board diversity comes in. Adding diversity means you will have people asking different questions, providing different perspectives, and sharing unique insights. There are numerous studies highlighting how diversity combats groupthink and how diverse teams outperform homogenous teams in complex, unstructured, and creative tasks. McKinsey recently released a report showing that more diverse executive teams also delivered financial outperformance relative to the least diverse teams.

How diverse are boards in Canada?
Many metrics are improving but there is still lots of work to do, particularly in the corporate sector. For companies on the TSX, women now hold 22 percent of board seats. This is comparable with global averages, but well below the 40 percent-plus that we see in some European countries, like Iceland, France, and Norway.

Visible minorities make up 5.5 percent of directors (while accounting for 22% of the population), while Indigenous directors and directors with disabilities account for roughly 0.5 percent each. However, these metrics are generally improving, with over half of new directors being women or visible minorities.

Things look a bit better outside of the corporate sector, although underrepresentation remains. According to data from Ryerson University, women account for 44 percent of all board members outside the corporate sector, while visible minorities account for 12 percent.

Unfortunately, with age diversity, we are moving in the wrong direction, with the average age of Canadian board members increasing to 63 years old (versus 61 a decade ago) and only six percent of board members being under the age of 50. This metric also compares poorly with the rest of the world, where Canada and the U.S. have, on average, the oldest boards.

Would you say a board has an important role to play to drive diversity and inclusion in the rest of the company?
While historically the focus for boards was on appointing the CEO and overseeing financial results and strategy, boards are now being asked to consider a variety of other issues. This includes culture, and boards are increasingly being asked to measure and influence an organization’s culture. Movements like #MeToo and Black Lives Matter have further highlighted to boards that diversity and inclusion are not only considerations at their level but need to be embedded across organizations. It seems there is still lots of work for boards to do in that area. For example, Norway is often held out as the poster child of gender diversity and inclusion, having implemented a gender quota on boards back in 2003. Norway now has 41 percent female representation on listed company boards and a female prime minister. Despite all this positive work at the board level, only seven percent of public limited company CEOs in Norway are women.

Why should younger individuals think about joining a board?
The first benefit of joining a board is that you can give back, and have an impact in an area close to your heart. Not-for-profits are always looking for high calibre individuals, so that’s a great place to start, too. More practically, you develop a brilliant network of leaders and learn valuable skills, particularly the softer skills that are required to build consensus or communicate complex or challenging subjects in a boardroom. Like many, I first experienced boards as an executive reporting to them. However, after sitting on a few boards myself, I became far more effective at engaging with and reporting to my own board, while becoming a better leader and executive.

The pros and cons of regulating board diversity? Should it be regulated?
It’s a controversial subject, but additional diversity regulations including mandated minimums are necessary in Canada, particularly for listed companies and Crown corporations. Quebec has a gender parity law for its Crown corps. However, we need to be careful using quotas as the only policy tool, and of turning diversity into a “tick the box” exercise. Ultimately, we need to review the entire board recruitment process and board tenure limits, and consider alternate models for developing and onboarding diverse directors.

How did the CFA designation benefit your career and assisted you at a board level?
Becoming a CFA charterholder has been valuable because of the technical skills, and also because of the network it exposed me to. It was also great that, when I moved to Canada, I had a recognizable designation and a community I could immediately plug into. On the board side, I feel I am better able to analyze and deeply understand the numbers, but the designation has also equipped me with the skills to appreciate both the reward and the risks associated with every decision. 

FUN FACTS ABOUT VOYT

If you could have travelled freely in 2020, where would you have gone?
We had planned to go visit family in South Africa in March, and the lockdown happened the day before we were scheduled to leave. We had booked an Alaskan cruise for my wife’s birthday, and planned to spend some time in BC over the summer.

Dream job when you were a kid?
I wanted to be an astronaut and, secretly, I still want to go to space. In Grade 12, I wrote a letter to NASA asking what their requirements were, and they responded that my best chance was to become a pilot for the U.S. Navy or Air Force. Seeing that I was a Polish kid living in South Africa, that was going to be problematic. These days, I am just more amazed someone responded to my letter in the first place!

The person you most admire?
Maybe it’s the South African in me, but Nelson Mandela is near the top of the list. I was fortunate to meet him when I was at school and he really made an impression. Also, he showed great resilience and courage—two traits that are often in short supply.

The superpower you would like to have?
Being able to manipulate time like Dr. Strange. My kids are growing up so fast, and I’d love to go relive or slow down some wonderful days being with my whole family.