The right model at the right time - Jim McKerlie

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Jim McKerlie has been a professional director for the last 20 years. He has sat on the board of 10 listed public companies in Australia and overseas and chaired of 8 of these. He is currently a director of Beach Energy Ltd and has recently stepped off the board of ELMO Software Ltd. He is an active member of the corporate business community, government circles and participates with the Australia Institute of Company Directors.

Jim has been an active member of ARM for many years and provided office space for the first Sydney office.

In this discussion about the Republic some of the areas we cover include:

  • Why no company director would tolerate a ‘golden chair’

  • Is inevitability a poisoned chalice?

  • Presenting the public with the right model at the right time

The discussion

Steve Pell: Jim, thanks for making the time to have a discussion today.

At a personal level, what are your major reasons for supporting a Republic?

Jim McKerlie: Well as a person who grew up on a farm and learnt, as did many Australians who settled this country, that we had to do it on our own to survive, I have a strong resentment that there is still some form of umbilical cord that goes out to England. I don't think there should be any ties to any country and with the mix of people that we've got in Australia now, it's even more inappropriate.

Steve Pell: At what age did you first recognise that this was an issue? When did the status quo start to agitate you?

Jim McKerlie: Oh, I think it's always been an issue for me. I've been a pro-republic supporter since university. I think when you became aware of Gallipoli and how Australia has always stood in behind Britain when it went to war. I grew up with a family with a strong history of giving in to the wars, and suffering significant personal losses. So, I've always had a view that Australia was an independent country and it was inappropriate that we should blindly follow another country.

When I grew up, of course the monarchists were far more prevalent, and I can remember going to weddings as a kid and the first thing that would happen is we'd all stand up and sing God Save the Queen. And it just struck me when I was eight years old that this was horrifically inappropriate. Even as a kid I couldn't understand why we would we be doing that. So, for me it's been ever since I've been aware of the world around us.

Steve Pell: What do you think will be the biggest benefit for Australia of a move to a Republic?

Jim McKerlie: I see layers and layers of benefit. I think there's got to be a sense of we've finally grown up, we've cut the umbilical cord, we've got no relationship, no statutory or formal relationship with another country and England.

I think at a certain level this will lead to the avoidance of confusion. I've found in business, that people say, “well do you still have to go to the Privy Council to get these big decisions ratified?”. I think it takes away this level of confusion.

But the real benefit is that we can start re-igniting the pride in Australia and we can move on to other issues that are very, very important. I think we can properly recognise our indigenous heritage and the fact that we've been here for 200 years, and others have been here for 40,000 years. I just think that it will make clear that we stand on our own two feet and on our own two feet alone, and we have to address the issues that are here in this country. These are our issues and we'll get on and address them in a contemporary way.

If you look back, Tony Abbott did the cause a great service by awarding knighthoods and damehoods because I don't think, to a person across the country, anyone thought that was an appropriate thing to do. People were embarrassed by what happened. And I think that in becoming a Republic people are going to think more about “what makes sense for Australia now”.

Steve Pell: My sense across the broader population is that there’s a feeling that the status quo is ‘okay’.

But if the current protocol was ever enforced, then we’d have riots on the streets. So if in 2019 we were to see Queen Elizabeth or King Charles actively insert themselves into Australian politics, almost no Australian would stand for that.

Jim McKerlie: Yeah, I would agree to that. I think most people have no real understanding of what the actual situation is, and assume that it is more a matter of protocol than the fact that the Royals have this golden share (a single share with the right to veto a decision of the company) in Australia and actually could be quite influential in not approving some of the things we wanted to do.

I think a lot of people are sort of saying, well, if it's not broke, don't fix it. But the reality is at a business level, no company director would allow a situation where there was a previous shareholder that held a golden share with the right to withhold approval of things the board wanted to do. No director would tolerate this situation. It would be a completely unacceptable, and in fact they'd be held to be grossly negligent for not rectifying that situation.

There is complacency and people feel that it's working okay, but the bottom line is that if the monarchy did act beyond what the protocol has been recently, there would be massive pushback from the Australian community.

Steve Pell: It's interesting. I had a conversation recently with a past member of Cabinet, who had a strong view that there’s a cycle of how ready the population is for reform.

Their view was that the 1999 campaign came right on the end of a reform cycle, and then we moved into a more conservative phase around the turn of the millennium driven by a whole lot of immigration themes. The idea was if the referendum had of happened a few years earlier, it probably would have got up, but at that time the population wasn't reform minded. I don’t know if I necessarily agree with the attribution, but I think there’s something to be said for making sure the national psyche is aligned to where we want to go.

How do you think about making sure we run the right campaign at the right time?

Jim McKerlie: So, I'm a fisherman and there’s the same issue. With fish there's times when they feed and times when they don’t and picking the right time is very difficult. But you can change that by putting burly in the water and conditioning the fish by raising the prospects of food. So I think the build-up, the effort in the couple of years before the actual plebiscite or referendum has to be substantial, because we can't leave it to chance. We need people to want it to happen.

We've actually got to do the hard work and the heavy lifting now. We start by getting our message very clear, then win over the population so that it doesn't matter what the environment or context is on the day of the referendum, people are already convinced.

Steve Pell: What lessons, if any, do you take from the marriage equality campaign?

Jim McKerlie: Yeah, it's really interesting. The message I took from that was there are the true believers who will put their hand up early notwithstanding the consequences. Then there are others who make up the majority, who are not opposed to it, and probably in their hearts believe it's right. But they're not going to throw their hand up so willingly in case the movement gets smashed down. They are followers who need to be led.

So how do you get that majority to actually step forward and be active earlier? I mean, when it was clear marriage equality was going to be a winner, then they came out of the woodwork. I mean, you couldn't hire enough buses to get them to the end. They just went crazy for it, but up until then the majority were missing in action. I think the lessons are, you've got to have a very simple campaign with a very clear message, that's consistently communicated. And you've got to find those that you know are for it but are passive. We've got to get early commitment from them and build the momentum early in the campaign.

What did you take away from the campaign, out of interest?

Steve Pell: There’s a few takeaways for me from the Marriage Equality campaign.

Firstly, I think we need to be careful just to lump them together as one socially progressive issue or agenda. I don’t see this as a progressive issue, and I don’t think we should be aligning in any way to the left or right side of politics. So there are some similarities, but also a lot of differences.

Secondly, I think the equality vote strongly illustrates the critical lesson of referendums, which is you win referendums when you reflect a change that the broader population feels has already happened in society. The constitution has to reflect the change, rather than driving the change.

I think we’re definitely on the right side of this. We functionally separated from Britain in the second half of the 20th century. And even more importantly, regardless of whether we’re a monarchy or not, I don’t think anyone in Australia today would tolerate British interference in the way we run our country. So I think as long as we position this as a change that’s already happened, rather than something that’s going to happen in the future, we have a really strong chance of success.

Thirdly, I think the feeling across the nation was politicians were dragged kicking and screaming to this issue. That frustrated a lot of people, but in the current political environment I think that worked for the issue. There’s such low trust of Canberra at the moment, that anything that’s perceived as politically led is going to polarise a lot of people. To the greatest extent possible, we need to ensure that the referendum is politicians reflecting a broader want from the people, rather than being politician led.

In the context of a Republic, we’re talking about the way government works, so this has the risk of getting very politicised. But I have a really strong view that we set ourselves up for failure if a Republic is seen by the broader population as being “by politicians for politicians”. It needs to be a change that's being enacted by politicians because of public pressure, for the benefit of everyone.

I know you talk to other business leaders about this issue regularly. What kinds of responses do you get?

Jim McKerlie: The responses from other business leaders are typically that there is in principle support of the concept at an individual level, but the benefit for the company they work for coming out in support is not apparent to them. They tend to take the view that their companies, are not players in persuading the population or the community in what they see as a political matter.  

So my take away is that we must show that there can be a business benefit from supporting a Republic. One benefit that is very clear to me is if your business wants to position itself as being an Australian company, then being an early mover and supporting the Republican Movement does give you that opportunity. It's an opportunity to get on the right side of an historical event. It is going to do a brand a lot of good to be seen to be supporting Australia as we take full control of our own destiny. For heaven’s sake there are enough companies out there with damaged brands that need to restore community and customer confidence and trust. It would be a great brand attribute to support a progressive Australia.

On another level, the engagement of employees could be enhanced significantly if they felt the employer was exercising their social license in a positive way by supporting the movement. Companies might find they become an employer of choice and they become more attractive in the employment market.  

Everyone in business I introduce these ideas to are generally supportive and agree, but large corporate boards will always tend to be the late adopters. We need momentum and I feel strongly that small to medium sized businesses are the right starting place where there are boards who are scared shitless on being criticized for doing something. You've just got owners who make decisions and live with the consequences, proudly or otherwise. The true believers!

Steve Pell: Clearly we’ve got some work to do here. You bring up a really interesting point about inevitability. There’s no doubt that inevitability is a poisoned chalice in a broader context, because it robs the imperative to do anything today. But that may not necessarily be the case in a business context, where boards want to be on the right side of history.

Jumping up a level, do you have any thoughts about the model and how we frame that discussion?

Jim McKerlie: I think that the model is a massive question. What model? Is the head of state going to be called a President or still called the Governor General? Are they appointed by politicians? Is that voted on by the populace? What parts of the constitution change? What are the knock-on effects?

Some people just want a Republic, but for a lot of people, they want to know how the Republic is going to work?

Now I mean, to be honest, after what we’ve seen in politics recently, a serious discussion and debate needs to be had about governance of this country. In my perfect world, we would actually be having a look at what do we need for contemporary Australia. I mean, you and I have talked previously about the duality of responsibilities of a Prime Minister in ceremonial and executive roles and the challenges that creates.

I think the average Australian who's going to vote on this will be going to want to know just what model we are proposing. And I think it would be horribly wrong to change the constitution in a very, very minor way to accommodate this change and have other archaic elements left there when we have a real chance to refresh our governance framework.

Steve Pell: Jim, we’re out of time. Is there anything you’d like to leave us on?

Jim McKerlie: My obsession is to work out what we're trying to sell to the public and get that clear and then we will work out how to sell it. But always remembering that we do have to sell it. And we de-risk the vote by having it clear and supported in people's mind before it gets to the vote. That's the key thing. And the simpler the explanation the better.

Then let's try and leverage technology to reach as many people and organisations as we can with the movement, because there's not enough feet. I mean holding sausage sizzles around the countryside is great to put a face on the movement, but we need to think about how we do things at scale.

And I really do think the business community is a large stakeholder in this and if we can win them over and leverage all their connections to customers, suppliers and employees we will be well on our way.

This interview is part of a series featuring prominent Australians talking about a Republic. You can find more interviews and subscribe at www.republic.org.au/businessnetwork