Governance Lessons from Ports of Auckland: Addressing the Gaps Between Policy and Practice
The tragic death of Pala’amo Kalati in 2020 brought Ports of Auckland (POAL) under intense scrutiny. While the CEO, Tony Gibson, faced prosecution for systemic failures in health and safety, the board was not prosecuted. This case reveals critical lessons for boards and executive teams across all sectors, highlighting the importance of bridging the gap between policy and practice.
The case has been well summarised on many great websites, from law firms to the NZ IoD and beyond. If you want to know more about the facts, just ask us.
A Breakdown in Systems Leadership
One of the most significant findings from the case was the CEO’s failure to fulfil his systems leadership responsibilities. Despite having comprehensive health and safety systems in place, their implementation was inadequate, leading to several critical gaps:
- Inadequate Oversight of Key Operations: POAL’s monitoring efforts were focused predominantly on daytime operations, neglecting night shifts, which accounted for half of the business. This oversight exposed workers to heightened risks.
- Delayed Responses to Internal Audits: Following a KPMG audit in 2018, the executive team repeatedly delayed addressing agreed-upon recommendations, leaving critical risks unresolved for over a year before the fatality occurred.
- Weak Change Management: Emergency changes during COVID-19, including the removal of the “leading lash hand” role, lacked proper planning and risk assessment. These decisions disrupted communication and compromised safety.
The Role of the Board
While the court found clear failures on the CEO’s part, the board’s role in oversight was also touched on (but not part of the prosecution case). The Audit Committee had been tasked with monitoring progress on the KPMG recommendations, but evidence of their follow-through was minimal in the reported judgment. Similarly, the board appeared to have limited engagement with operational safety gaps revealed in monthly reports.
As Judge Wylie noted, “Systems are the means by which a business translates its policies and objectives into reality.” However, systems only work when there is active monitoring, regular reviews, and accountability at every level of governance.
Key Lessons for Boards
- Understand Work as Done vs. Work as Imagined
Boards must move beyond reviewing policies on paper and actively understand how work is carried out in practice. This involves engaging with frontline operations, monitoring shifts beyond the 9-to-5, and identifying blind spots - Embrace Systems Leadership
Leadership isn’t just about creating systems—it’s about ensuring they function effectively. Boards should regularly audit health and safety frameworks to identify and address implementation gaps. - Prioritise Change Management
Organisational changes, especially during crises, require robust risk assessments. Boards should insist on clear change management processes to mitigate unintended consequences. - Monitor Progress Diligently
Delayed responses to audit findings can exacerbate risks. Boards must ensure timely follow-up on action plans and demand accountability from the executive team. - Cultivate a Safety-First Culture
Past incidents at POAL indicated a poor safety culture. Boards must lead by example, fostering an environment where health and safety are integrated into every decision.
- Understand Work as Done vs. Work as Imagined
Proactive Governance: Bridging the Gap
The POAL case serves as a stark reminder that policies alone cannot safeguard organisations. Effective governance requires a proactive, inquisitive approach—one that continuously evaluates whether systems are working as intended and where risks may still exist.
At Grounded Governance, we help boards strengthen their oversight and foster a culture of accountability. From understanding roles and responsibilities to strategic planning, our workshops and evaluations provide boards with the tools to navigate complex challenges confidently.
Don’t wait for a crisis to highlight gaps in your governance. Contact us today to ensure your board is equipped to lead with clarity and resilience.