Interview with Stephen Lee

Mr Stephen Lee is Chairman of Singapore Airlines Limited (2004 – 2016), SIA Engineering Company Limited and the NTUC Income Insurance Co-operative Limited. He is also the Managing Director of Shanghai Commercial and Savings Bank Ltd. (Taiwan) and Great Malaysia Textile Investments Pte Ltd among several other appointments. Mr Lee is a Senior International Advisor with Temasek International Advisors Pte Ltd and an alternate member of the Council of Presidential Advisers.

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WHY IS GENDER DIVERSITY IMPORTANT TO YOU?

You need diversity at the board level to help management improve the thinking process. The more diverse the board is, the more comprehensive the discussion will be. Diversity brings wider views and helps management with input; therefore, we hopefully get better answers.

At SIA, we have always had different nationalities represented because, being such an international company, we need insight into developments in key markets. We have had gender diversity for many years. This is important, especially for a customerfacing industry like ours, where we serve a large number of female customers. Through the years, we’ve noticed that, depending on the area of expertise, sometimes a male expert and a female expert bring different perspectives. Many of our Board members are frequent flyers. So again, from a customer feedback standpoint, we see that diversity brings different perspectives.

HOW MIGHT A FEMALE FREQUENT FLYER HAVE DIFFERENT VIEWS FROM A MAN WHO TRAVELS FREQUENTLY?

Women are able to bring a certain perspective that the guys don’t have. For instance, some female passengers want to ‘touch up’ before arrival. But on full flights the queue at the washroom can be quite long, even in the premium classes. So, we have put a small mirror at each seat.

In another example, women passengers prefer a bit more privacy, so when looking at certain seat types for our aircraft, we chose seats in the premium class with a certain orientation where you sleep at a certain angle. Again, these little touches are things that sometimes the guys don’t think of. These are some of the improvements we’ve made that come from gender diversity.

ARE YOU LOOKING TO INCREASE THE NUMBER OF WOMEN ON THE SIA BOARD?

We are. We’ve gone out actively looking. It’s important for a consumer-facing industry like ours where many of my employees and many of my customers are females. We need more gender diversity. Women can somehow put things across differently, whether it’s internal communications or there’s a discussion on the board.

The male members very much look forward to their input, to see whether or not they have a different view, both professionally and generally. So, the contribution by the board members is not just in the board business discussions. In a service industry like ours, a lot of the feedback also comes from board members who hear from their friends, and then there are their own experiences.

“We have had gender diversity for many years. This is important, especially for a customer-facing industry like ours, where we serve a large number of female customers.”

IS IT POSSIBLE TO MEASURE THE TANGIBLE ADVANTAGES OF HAVING WOMEN DIRECTORS?

I think it’s more about the process. Quantitatively, it’s more difficult to measure. When we look for board members, we are quite genderneutral and we look for capabilities first. But increasingly in the last couple of years, gender diversity has become more important. The Board feels that, since half of our customers are female, women should have better representation.

Also, SIA has a large number of female employees, especially the customer-facing stewardesses. Sometimes on a long flight they have time to chat, and part of the director’s role is to get feedback from employees, especially on human resource issues and approaches. We find the female employees relate better to a female director. They are able to be more open – they are more comfortable discussing some issues with them.

So these benefits are more qualitative, and difficult to quantify.

HOW DO YOU SOURCE FOR DIRECTORS?

We look at the rotation and the retirement of directors and we look to fill certain gaps. We will make a shortlist, and in the shortlist we like to see gender diversity. We will look at the Board twice a year, at who may be stepping down and what sort of capability gap we need to fill. And more often, we are looking at the next 10 years of the company’s development and we say, “Where would we like to be and what capability do we need to build?” We may do this internally or we may do this with outside agencies. So, the mandate will be quite specific – it’s not just any director with experience.

RATHER THAN BEING GENDER-NEUTRAL, SHOULD CHAIRMEN BE MORE PROACTIVE?

I think so. We purposely look for gender diversity, but I still rank the skill set and experience first.

We also search intentionally to fill certain gaps and build certain capabilities. For instance, right now we are looking for skills in big data. Sometimes, because of the male domination of certain fields, suitable women may be more difficult to find. If we can, we should have two or three women on the Board, but we are not just going to appoint them because of gender. Filling those capability gaps would be more important.

Perhaps having a female heading the nominating committee can help with gender diversity.

SOME CHAIRMEN MIGHT WORRY ABOUT BEING TAKEN OUT OF THEIR COMFORT ZONE BY HAVING DIRECTORS IN THE BOARDROOM WHO CHALLENGE THEM.

SIA management welcomes that. We need to be stretched. SIA has been very successful for quite a long time. One of our worries is that we become trapped in our past successful formula, afraid to break away from it.

When you are a premier corporate business airline, or known as such, to go into low-cost carriers is a big diversion. But we had that discussion 10 years ago and started Scoot. We need to stretch ourselves and management welcomes that. I think very few industries will have a very stable environment for the next 10 to 15 years.

“Women can somehow put things across differently, whether it’s internal communications or there’s a discussion on the board. The male members very much look forward to their input, to see whether or not they have a different view, both professionally and generally.”

WHAT IS YOUR ADVICE TO CHAIRMEN WHO ARE RELUCTANT TO CHANGE BECAUSE THEIR CURRENT STRUCTURE HAS WORKED IN THE PAST?

There is a big attitudinal change between successive generations. I see a bigger attitudinal change between myself and my son on many of the traditional issues. Maybe this is because the internet is levelling the availability of information. The gap between me and my father is not as big as that between me and my son, be it about technological savviness or attitudinal differences towards a host of issues.

So, there is hope when the new generation comes up. In Singapore and in Hong Kong, I have seen the next generation take an active lead in successful family businesses, sometimes with the patriarch still around. There is some recognition by the older generation that this is required for the success of the company. A very parochial type of approach just harms their company.

WHAT IS YOUR REACTION WHEN YOU HEAR CHAIRMEN SAY THEY DON’T NEED FEMALE BOARD MEMBERS BECAUSE THEY HAVE WOMEN IN THEIR EXECUTIVE TEAM?

Participation in issues is quite different at the board and management levels. The Board spends a lot of time on governance issues. We need people who are knowledgeable about governance and can think strategically and globally. This is especially the case for SIA – we need to be able to anticipate behavioural changes that may be coming, so we constantly want to engage our younger customers to see how they would like to make travel decisions.

SHOULD QUOTAS BE SET TO ADDRESS THE GENDER IMBALANCE ON SINGAPORE BOARDS?

It’s very difficult to set a quota. Boards must genuinely see the benefits diversity can bring. There are enough role models, such as female ministers and CEOs, and also quite a few of Singapore’s leading companies have very competent female CFOs. We have one in our group. So, I think the biases are beginning to subside – they are breaking down.

Quotas won’t work. Companies will find ways to get around the quota. It also creates a negative image if you are a female director. It creates the impression you were picked because of the quota – so I’m not for that.

For more interviews with board chairmen and directors, please see DAC’s report ‘Speaking with the Boards‘.

Speaking with the Boards‘ is a supplement to DAC’s report ‘Women on Boards: Tackling the Issue‘ launched in October 2016.