- Fixing dysfunction with State Trustees CEO Craig Dent
- By David Donaldson
- Contributed by: Kent_M ( 1 article in 2015 )
There’s only one other public trustee in the world structured like Victoria’s State Trustees, and it’s in Fiji — but operating as a fully-fledged, though state-owned, company in a space where most organisations still sit within government gives it a higher level of financial stability, argues State Trustees CEO Craig Dent.
It’s a challenging job, managing the financial affairs of those unable to do it themselves, whether due to dementia, brain injury, mental illness or a range of other causes — the majority of whom possess no assets and cannot pay fees — all the while paying tax and still being expected to provide a dividend to the state government.
The model appears to be serving the state well. Whereas the NSW Trustee and Guardian — which is part of the Department of Justice — has been named “financially unsustainable” after it recorded a $1.7 million operating loss for the 2013-14 financial year, Victoria’s State Trustees recorded an after-tax profit of $3.7 million, half of which is customarily paid as a dividend to the state government. Nonetheless, unlike other companies, once savings are found in other areas, the aim is to lower fees.
“The envy of other jurisdictions locally and internationally about the Victorian model is quite high,” Dent told The Mandarin. “The sustainability of public trustees around the world is a real issue, because we’re all living longer and we’re all going to be healthier.” He is often in contact with other jurisdictions asking for details of the Victorian model with an eye to future reform.
Staying true in a complex field
But State Trustees’ position as a guardian of the interests of the vulnerable means the media are always watching.
“If you’re genuine about your organisation, you’ve got to accept that sometimes bad decisions are made or there’s unintended consequences … you’ve also got to make sure it can never happen again.
Earlier this year, The Age newspaper reported that the “life savings of disabled and mentally impaired Victorians have been lost” by State Trustees “after it invested their money in high-risk funds”. The story included claims by the family of a late client, who had dementia, that State Trustees had lost thousands of dollars from her account.
But, says Dent, the claims were “fictitious” and resulted from the misinterpretation of financial information by the client’s daughter. “There was no scandal, there was no conspiracy,” he argued. “The word ‘beat up’ comes to mind.”
Part of the problem was that relevant information wasn’t clearly communicated for a lay audience. “I get why the client’s daughter didn’t quite get what had gone on. Our statements to the client at the time weren’t great. They were very transactional, there wasn’t a lot of narrative or explanation,” he observed.
It’s a similar problem faced by utilities and telcos — making complex information understandable for customers. This job is made harder by the fact that State Trustees clients have a range of capabilities, meaning people want to be communicated to in different ways about their holdings, asset movements, cash on hand, ongoing liabilities and other indicators in meaningful ways.
If State Trustees had been in the wrong, argues Dent, it would have been easier to remedy. “Frankly the simplest thing during that exercise would have been to say, we stuffed up, we made a bad decision, here’s $15,000,” he said.
“But I need to have a cause, I need to have a reason to do that. My starting point is we’ve stuffed up or we haven’t. [But] we went through the process, it became apparent we hadn’t, which is actually harder.”
After becoming CEO in 2013, Dent also inherited a 2012 auditor-general’s report that found the company was unable to demonstrate it was acting in the best interests of its clients, stating:
More recently State Trustees has implemented changes to its products and services to ensure they comply with improved powers of attorney legislation to make it easier to protect the vulnerable from financial abuse. The company is currently investigating more than 150 cases where financial abuse is suspected to have occurred.
His advice to executives dealing with bad media coverage is “be as open as you can, and be as accessible to journalists as you can be.
“The only way, if you’re genuine about leadership and you’re genuine about your organisation, particularly as leader of it, is you’ve got to accept from time to time that sometimes bad decisions are made or there’s unintended consequences and you’ve just got to front up to it.
“If you’ve stuffed up, you say you stuffed up. And you’ve got to take it, got to be accountable, but you’ve also got to make sure it can never happen again. That might be a process change, a policy change, a personnel change. Whatever that change needs to be, make the change, make it quick, be open, be honest, make good and continually test,” he said.
‘I like things that are dysfunctional’
Dealing with disasters is not new for Dent. The theme across his varied career, he says, is “dysfunction” — fixing up systems that don’t work.
He left school early, impatient to find his own way, and attended DJ school, but says that as soon as he graduated “I was over it”. From there Dent spent seven years doing investigative work, before moving on to utilities, working for a poles and wires company as contestability was being introduced.
He’s consulted on higher education, was employed by Optus, and worked on trying to smooth out some of the problems with Melbourne’s maligned public transport ticketing system Myki.
“I guess the themes are I like things that are dysfunctional, things that don’t work, because I enjoy and I think I’ve built skill and capability around fixing those things,” he said.
One of his golden rules is to surround himself with smart people — an adage he says many espouse but few practice.
A key focus at State Trustees has been reforming the organisation’s culture through some “pretty dramatic” changes. Dent started out as general manager of client services in March 2012, becoming CEO in December 2013.
The changes mean the company has “put the client at the forefront and at every step through the decision making process. And we had to remove quite a lot of cost. We’ve become more commercial, in essence, and that was really critical,” he says.
This included a “shock and awe” approach to culture change, leading to a number of employees leaving in a relatively short period. “They were, and we did it quite transparently, the poorest performing individuals.
“People who perhaps weren’t engaged with the purpose and the mission, and might not have been engaged with where we wanted to go as an organisation. They were more wedded to what the public trustee was,” he explained.
Knowing when to dial back
Another aspect of this transformation has seen State Trustees shift to become less paternalistic towards its customers. In the old days, the company would make someone who wanted a new 100cm television obtain three quotes from places it prescribed, then would consider the prices and make a determination.
“Then quite often we’d say, ‘you’re going to get a 60cm TV not a 100cm’. That makes no sense, right?”. But now it’s different. “The person’s got the money and their bills are covered and they want a 100cm TV today, it’s done, dusted, no need for quotes, straight through. The experience is better, they’re not running around,” he says.
The reforms have also involved recognising that there had been some “overservicing” of clients.
“On a Friday night a client might ring up and say, ‘I’ve got nowhere to live, I’ve got nowhere to sleep’. My staff, instead of referring them to a service that could actually help them, would sit there and ring around and try and find somewhere for the client,” he relates.
“It’s not what we’re there to do, it’s not what we’re trained to do, and there are other services that are more appropriate.”
The result has been improved staff morale, which, as with other public sector entities, is important for State Trustees, given many employees could go somewhere else and be paid more. If the sense of social purpose is not there, retention becomes more difficult.
It’s “incredibly confronting” to contemplate how disenfranchised and disempowered many State Trustees clients feel, says Dent, remembering they’ve lost capacity, whether it’s through an acquired brain injury, mental illness, or dementia, or a range of other issues.
“It’s a privilege for us to be working with people in that circumstance because they are truly vulnerable, and it’s our core reason, ultimately, for why we exist.”