A Conversation on Leadership with HSBC Board Director, Beth Horowitz

With Beth Horowitz, Board Director, HSBC Bank Canada

BY LISA HEIDMAN LL.B, SENIOR CLIENT PARTNER, THE BEDFORD CONSULTING GROUP, NORTH AMERICAN DIRECTOR OF BEDFORD LEGAL

Beth Horowitz is a Board Director of HSBC Bank Canada. With more than 260 offices, including 140 bank branches, HSBC Bank Canada is the leading international bank in Canada. With 7,500 offices in 87 countries and territories and assets of US $2,691 Billion as of June 30, 2011, the HSBC Group is one of the largest banking and financial services organizations in the world. With extensive Board and diverse US and Canadian Executive experience, Ms. Horowitz worked for American Express for over 20 years in Toronto, London and New York and held a wide variety of Executive and Board positions, including Chairman, President and Chief Executive Officer of Amex Bank of Canada, the Canadian subsidiary of American Express Company.

With a global and international focus, Ms. Horowitz is known and widely respected for driving profitable growth in a dynamic and challenging regulatory environment. Active on multiple Boards and within the community, Ms. Horowitz also serves on the Board of Trustees of the Art Gallery of Ontario, the Dean’s Advisory Board of the Schulich School of Business, the Board of the Harvard Business School Club of Toronto, and has served on the Advisory Board of Catalyst Canada for the last 7 years. Ms. Horowitz holds a BA from Cornell University, an MBA from Harvard University and received her ICD.D designation from The Institute of Corporate Directors, University of Toronto, Rotman School of Management

BETH, WHEN YOU LOOK AT YOUR OWN BEGINNINGS, HOW DID YOU MAKE THE TRANSITION FROM WHERE YOU BEGAN, TO WHERE YOU ARE TODAY? SPECIFICALLY, HOW DID YOU MAKE YOUR WAY FROM THE GROUND FLOOR UP TO ULTIMATELY BECOME AMEX BANK OF CANADA’S PRESIDENT AND CEO?

Just after my sophomore year at Cornell, I was fortunate to have a temp job at the American Express Foundation in New York, where I was exposed to business philanthropy, a great brand and a dynamic corporate environment. Later on, through a Career Management course at Harvard, and in the process of self-discovery, I realized that what I wanted to do was work at a global, customer-focused service company with a strong brand. That led me back to American Express. I started my Amex career in Worldwide Marketing and Communications, and over the years, progressed through a variety of product development, strategy and operating roles.

So, how did I get there? Yes, there was much hard work and long hours, a constant push for driving results, and learning a tremendous amount from people I worked for and from my colleagues at all levels of the organization. However, fairly early on, I also discovered that I loved learning so much that I was willing to take risks in my career. Was there a business challenge with no solution?

Sign me up! Starting a new line of business for which we had absolutely no roadmap? Great! Let me create one! One week to develop a bid strong enough to win a key high profile partnership over all of our competitors? Let’s do it! That was always my philosophy and it opened doors and created great opportunities for me all along the way.

THE POWER OF CONFIDENCE IS ONE OF THE KEY QUALITIES WE REGULARLY SEE IN SUCCESSFUL SENIOR EXECUTIVE WOMEN LEADERS, AS IS THE ABILITY TO TAKE RISKS.

That certainly has been my experience. When I look back, I confess I didn’t have a strategy in going for these roles or projects, as these were simply the things that most appealed to me. I also soon discovered that taking career risks provides you with great visibility, (whether you succeed or fail), new skills, and fantastic experience, and often brings other opportunities your way. And it built my confidence. My takeaway from all the risks I ever undertook was that sometimes your very best professional opportunities require taking risks and going beyond your personal comfort zone.

WHAT OTHER KEY COMPETENCIES DO YOU THINK ARE REQUIRED FOR SUCCESSFUL LEADERSHIP? WHAT OTHER FACTORS AND INFLUENCES WERE ESSENTIAL TO YOUR SUCCESS?

I believe that great leaders find and nurture the very best talent. The leaders that I have most admired each possessed courage, vision, compassion, honesty and integrity, a collaborative and authentic leadership style, the ability to build and motivate talent, and of course, to drive business results. In my own career, I have also been fortunate to work with an exceptional group of talented people, who enjoyed collaborating and working together to build great businesses. I have always sought out the best talent and was fortunate that some people that worked for me agreed to do so again in different parts of the company. I invested a lot of time developing talent, and of course the contributions to the business by the teams I worked with were absolutely critical to my own success.

Throughout my life, one of the most positive and powerful influences has been my mother. I remain in awe of her and how she empowered me from an early age. She had the right balance of self-confidence and humility and gave me the confidence that I could achieve anything I set my mind to. She remains an important source of advice and support to me, and I credit much of my career success to her positive energy.

BOTH CATALYST AND WOMEN OF INFLUENCE HAVE CONSISTENTLY RECOGNIZED THE CRITICAL ROLE THAT MENTORING AND SPONSORSHIP PLAYS IN OPENING DOORS AND PROFESSIONAL OPPORTUNITIES FOR SENIOR EXECUTIVE WOMEN. HOW CRITICAL WERE MENTORS AND SPONSORS FOR YOU IN YOUR OWN CAREER DEVELOPMENT? WHAT DID THEY TEACH YOU, WHAT DID YOU LEARN? 

Two of the most instrumental sponsors in my career were people I worked for across different points in my Amex career. They each took a personal interest in me and advised me, long after I had ceased working for them. From Jerry Welsh, formerly Executive Vice President, Worldwide Marketing and Communications, who originally hired me into Amex, I learned to think out of the box, innovate, and take strategic risks. From Jim Cracchiolo, formerly Group President, American Express Global Financial Services, and who is now CEO of Ameriprise, I learned about building talented, diverse, high-performing teams and how to drive results based on clear strategies and balanced metrics. Both of these mentors were instrumental to my success at Amex, providing advice, perspective and many opportunities for me to grow.

I also credit Martha Redfield Wallace, who was a pioneer among female Corporate Directors and on the Board of Chemical Bank, AT&T, American Express and others, when very few women were on Corporate Boards.

While I was working at the Japan Society, a not-for-profit organization in New York, Martha was on the Board and I was the staff member responsible for the 75th Anniversary Campaign. We worked closely together and she taught me how to drive results at the Board level, network effectively and make connections, and I saw firsthand how she actually got things done, selling tables for events or getting renowned speakers involved. She knew how to work a room, how to hold her own, and had a commanding presence. Martha was a trailblazer and I learned a great deal from her.

In my experience, while formal mentoring programs can be valuable, the best mentoring relationships often arise organically, with someone who wants to mentor you because they believe in you and see your capabilities and potential. In an effective mentoring relationship, the mentor gets intrinsic satisfaction from sharing and helping, and also can learn from the mentee. Chemistry and genuine interest are much more important than gender.

THERE IS HOWEVER, SOMETHING UNIQUE ABOUT THE SHARING OF LESSONS BETWEEN SUCCESSFUL WOMEN AT THE TOP. HOW CRITICAL HAS THE SUPPORT OF A SENIOR EXECUTIVE NETWORK OF WOMEN BEEN TO YOUR OWN CAREER SUCCESS? 

Certainly there were senior executive women that I admired early in my career who were breaking boundaries and paving the way for many of us who followed. But in the early part of my career, there simply were not as many women at senior levels as there are today. At Amex, in the early 1990’s, a handful of women in our business began to regularly get together for lunch to support each other personally and professionally. We were encouraged by the ability to be there for each other, provided support and guidance at critical points in our careers, and truly appreciated and celebrated each others’ successes. This group ultimately became founding members of the Women’s Network at American Express, which still thrives today.

Supporting women as they build their careers continues to be very important to me. I invest time in mentoring and have also been a proud member of the Advisory Board of Catalyst Canada, which is dedicated to expanding opportunities for women in business. I have also really enjoyed attending events sponsored by Women of Influence. The panel discussions and the Dinner Series where an intimate group of women at the CEO and Board level candidly share their experiences, learnings and insights across industry sectors are invaluable.

WHEN YOU LOOK BACK BETH, WHAT WAS THE DEFINING MOMENT OF YOUR CAREER? 

Great question. The easy answer was that it was my appointment as President & CEO of Amex Canada, but it wasn’t. The defining moment was what I was able to accomplish once in the role, leading an awesome team to compete for and then win the co-brand partnership with Aeroplan. This happened in 2003, when Air Canada entered into CCAA and the Bankruptcy Court Judge opened up the exclusive contract that Aeroplan had with CIBC.

Up to that point, AMEX was shut out of this lucrative opportunity, but we, and others were given one week to submit a bid, a process that usually occurs over months of discussion. Winning that partnership really helped Amex Canada regain a leading position in the very important affluent frequent traveler segment, and fueled both market share and profit growth. Our win was recognized within the industry, making Amex a more serious credit card competitor to the big five banks. I remember one Catalyst meeting shortly after our 2004 product launch, in which I was approached by two bank CEOs on Catalyst Canada’s Advisory Board, who asked whether it was time I went back to the States. That was the best compliment.

HOW DO YOU FEEL YOUR CANADIAN AND US EXPERIENCES HAVE INFLUENCED AND IMPACTED YOUR WORK AND YOUR PERSPECTIVE? DO YOU SEE A DIFFERENCE AT EITHER THE CEO LEADERSHIP AND/OR BOARD LEVEL IN CANADIAN AND US BUSINESS ENVIRONMENTS?

In my experience, and broadly speaking, US leaders across industries, tend not to think in terms of boundaries, they just think, “I’m going to get it done”. There is a decisiveness and boldness that of course must go hand-in-hand with my ethics to really work. My Canadian team once gave me feedback that they felt we accomplished more than they ever thought we ever could and they attributed it to my coming in with an American attitude of “just do it”.

In Canada, aspirations can sometimes be more modest. I’ve learned to appreciate, particularly in this era, that there is real value to Canada’s somewhat more conservative culture and its more collaborative approach to decision making. Generally, within the Canadian banking system, there is a healthier relationship with the regulators amongst the Canadian banks than I have seen in the US. While there is a dynamic tension, there is also a healthy respect, and a tremendous emphasis in Canadian financial institutions on intelligent risk management and having sufficient capital. And the proof is in the pudding. As the 7th largest bank in Canada, HSBC Bank Canada joins the other large Canadian banks in taking a truly holistic approach to risk management, which has unquestionably contributed to HSBC Bank Canada’s effective navigation through the financial crisis.

Fundamentally though, for today’s leaders, what’s important is not as much about differences between the US and Canada, as the ability to think across many markets. In my career, I have been fortunate to work globally and in positions where I have had to think across 25 markets. That is an invaluable experience in terms of the ability to lead businesses, adapt to market complexities and really drive profitable growth. Emerging leaders today, if they really are shooting to have a career at the CEO level, should be able to think more globally and appreciate where growth opportunities lie. While there may be differences between the political environments and the economies between Canada and the US, these pale in comparison to the differences beyond North America, and the ability required to strategically and effectively lead and do business in Asia or in Latin America. Today’s senior leaders should to be able to do business at a global level.

IT’S BEEN WELL ESTABLISHED THAT HAVING MORE WOMEN AT THE SENIOR EXECUTIVE AND BOARD TABLES IS JUST SMART FINANCIAL BUSINESS FOR CORPORATIONS, GLOBALLY. IN ADDITION TO THE BOTTOM LINE, WHY DO YOU THINK IT MAKES A DIFFERENCE TO HAVE MORE WOMEN ON BOARDS?  

Numerous studies globally, including Catalyst, demonstrate that diverse Executive teams and Boards drive superior financial and business results. Businesses with talent from diverse backgrounds provide different perspectives, come up with better ideas and the decision making around the table simply changes. It’s just common sense that if you fail to tap into a significant portion of your talent pool, whether gender or otherwise, you will not get the full benefit of the talent and resources in your business.

In my own experience, when women are part of the equation on Boards, they ask questions that might or might not otherwise be asked, including questions on management performance metrics, talent development, succession planning and compensation processes with respect to gender equity. They can help uncover subconscious biases that may be occurring, and provide the perspective of female consumers who drive a majority of purchase decisions in many sectors. I also believe that having more women on Boards has a direct impact for women in senior executive roles, as Board members can serve as role models and advisors for senior women within an organization. The ability to interact with these women, to encourage them, to answer their questions, I have been told often, is invaluable to them.

SEVERAL EUROPEAN COUNTRIES HAVE ENACTED LEGISLATION TO ENSURE AN INCREASE IN THE NUMBER OF WOMEN ON CORPORATE BOARDS. NORWAY, SPAIN AND FRANCE ARE EXAMPLES. WHAT DO YOU THINK IT’S GOING TO TAKE TO GET MORE WOMEN ON BOARDS IN NORTH AMERICA?  

I’d rather it not be mandated by legislation. A mandate can be treated as a regulatory checklist item and have unintended consequences, including the same small pool of women Board members serving on too many Boards, as is already happening in Norway.

A better alternative is for more Board Chairs to take governance responsibilities seriously, and to recognize the proven financial performance advantages resulting from diverse Boards. I think it’s much more effective, if Board and Nominating Committee Chairs, who are in a position to drive change, understand the business case for diversity, and choose to drive change because of the clear strategic and financial benefits to their corporations.

I have been privileged to serve on diverse Boards including HSBC Bank Canada, which has driven diversity and inclusion on several levels, including geography, ethnicity and gender. I have had a very positive and open Board experience at HSBC. It’s a progressive Board in terms of governance and we recently named a non-executive Chair, who is doing an outstanding job. In my view, HSBC Bank Canada is an exceptional example of Board diversity and the positive impact it can have on the business.

Through Catalyst Canada, I have engaged in many conversations on this topic. What will hopefully be addressed going forward is the behavior of Nominating Committees on Boards. These Committees should ideally look more broadly than who they know personally and professionally, and apply systematic processes assessing current Board composition, competencies, length of time served and potential gaps given future growth strategies and the external environment. Diversity can also be one way to ensure checks and balances to the potential group think mentality that in the past has led to some corporations taking excessive risks.

The good news is that there is actually a wider pool of experienced and qualified candidates for Board appointments than people may realize. The preconceived notion that you need CEO experience to be on a Corporate Board is now starting to erode and for good reason. First, with emphasis on governance and corporate responsibility, many sitting CEOs are being urged not to sit on external Boards or to limit their participation. Second, it’s clear that there’s a much broader population of Board-qualified executives who can serve and meaningfully contribute to Board performance, including division heads and subsidiary CEOs, and Boards globally are starting to understand this and act on it.

DRAWING ON YOUR OWN KEY LEARNINGS ALONG THE WAY, WHAT GUIDANCE WOULD YOU IMPART TO THE MULTITUDE OF BRIGHT AND TALENTED YOUNG WOMEN IN BUSINESS TODAY?  

My guidance would be that as you build your career, focus on your personal network of relationships, the people you meet throughout your lives in university, at work, professional organizations, and through friends and social connections. Your network will evolve and grow over time, and it will help you in ways you cannot even contemplate when embarking on your career. Invest time in your network, and focus particularly where you feel genuine connections, as those are the ones that will last. Be open to feedback and continuous growth. Give back and open the doors for others. If you can, develop your own personal Board of Directors around you, with whom you can consult on major career and life decisions.

I have also learned that it is important to take risks and that it’s ok if you don’t always succeed. In fact you can learn as much, if not more, from failure as from success. Rather than worrying about having it all, focus instead on defining what success means to you, individually, and have the wisdom to know that who you are, and what your life priorities are, will change over time. I’m still on that journey of self-discovery and personal growth.

Also surround yourself with positive people. You will know if you are in the right environment if the people you have around you fuel your passion and give you energy, rather than deplete it. Have a sense of humor, take your work seriously and yourself less seriously. No matter how busy you are building your career, your family, or both, make sure that you aren’t too busy to find that balance and enjoy life right now. Make sure you are living in and enjoying the present.

Lisa Heidman, LL.B., Senior Client Partner, The Bedford Consulting Group, North American Director of Bedford Legal, brings over 15 years of Legal, Board and Executive Search Experience working with Boards and their Senior Leadership Teams, placing Board, CEO and C-Suite Executives across functions. Appointed to the Board of Directors of Women of Influence in 2009. Lisa can be reached at lheidman@bedfordgroup.com.