In addition to being Canada’s CFO of the year, you have been named one of Canada’s Most Powerful Women three years running, as well as one of the 25 Most Powerful Women in Banking by American Banker. What does power mean to you, and how do you go about using it?
It’s tough for me to embrace the notion of power. I prefer to think about the importance of influence, and what that means in terms of having a positive impact and making my organization stronger. I also think about what I can do outside of the bank, and how I can use my influence to help organizations in the not-for-profit sector — and there are some that are very close to my heart. I also believe influence is about being a good role model for other people in the organization – both women and men.
Transparency is a key element of TD’s ‘leadership profile’. As CFO, how do you contribute to that?
I firmly believe that transparency starts with the way you treat people within the organization — the way you deal with your colleagues and your team members on a day-to-day basis. In a large organization such as ours, things don’t work perfectly all the time, so transparency is important in terms of making sure that when issues arise, they are escalated quickly. I believe you need to create an environment where people know they can bring issues forward, and that they will be dealt with in a constructive manner. It’s extremely important to be fair and equitable with people.
External transparency is equally important, and it’s a huge part of our investor relations brand promise. With investors, I think ultimately people will give you the benefit of the doubt. I’m into my seventh year as CFO now, and a big part of my satisfaction from the role comes from my interactions with external investors and analysts, all of which are based on trust and transparency.
Another of TD’s main goals is to foster female leadership. Describe your efforts on this front.
I’ve been proud to chair the Women in Leadership sub-committee at TD as part of our broader diversity agenda. Today, about one third of our executives are women, up from about 22 per cent in 2005 when we formed our Diversity Leadership Council. We believe strongly in the business case for diversity and inclusiveness: the best companies need to hire the best people and help make them their best. That’s our motto.
Reflecting on our progress with Women in Leadership, I think the key is unwavering executive support — starting with the CEO. You also need to ensure a meritocracy, which supports sustainability. We’ve also added a program focus that involves initiatives related to networking, mentoring, communication, career development/planning and flexibility. Our emphasis on flexible work options applies to all employees at TD — men and women —because in this modern age, everybody is thinking about how to manage the multiple demands on their time and what a ‘whole’ life looks like outside of one’s career.
In recent months I’ve been reflecting a lot on how much progress has been made with women in leadership. I graduated from university 30 years ago, and I came out thinking that the ‘world was my oyster’ as a woman in business. I think this is true now more than ever for women starting their careers. I urge women to focus on the positives and the progress we’ve made, and celebrate the joys of a great career.
Based on your 30 years in business, what are some of your observations about women in leadership?
The first is, ‘let’s change our language’. I do lots of university recruiting, and during the networking sessions I always have very qualified female students approach me and ask, “How have you made it as a woman in business?” These are young women in their 20s with credentials far greater than I had 30 years ago. I try to find a way to say to them, “Don’t ask that question; you have a level playing field; you have everything you need to be a smashing success.” That’s why we need to change our language.
Let me tell you a story. In January of 2011, I achieved a great personal milestone when I made it to the top of Mount Kilimanjaro. At more than 19,000 feet, it is the highest mountain in Africa. I was part of a group of eight women, with two female guides from Toronto and a support team from the region, and we lived on that mountain for seven days. I will always remember our summit night: we solemnly left our camp at midnight, with the goal of arriving at sunrise. A couple of nights before, our guides spoke to us about how to get ready, psychologically, for this final trek. They said that at some point we’d feel like we couldn’t go on — that we would need to dig deep and convince ourselves that we could do it. What would we say to ourselves at our darkest moment? That’s when we learned the benefit of having a mantra — a few words that can inspire you to achieve things you thought you couldn’t. I’m happy to report that we all got to the peak in good health and good spirits; it was pure exhilaration!
My point is, it is often what we say to ourselves that determines the outcome of things in life. If we believe in ourselves, each of us can achieve anything within our potential; but too often, what we say to ourselves is negative. We convince ourselves we can’t do things, and it holds us back. We’re all guilty of this to some extent, and we need to get past it. By the way, this trait is not exclusive to women, but I do think we’re particularly guilty of it.
The company we traveled with is called Live Out Loud Adventures, and they have taken numerous all-female groups to the top of Kilimanjaro – with 100 per cent success. You know what made the difference as to whether we got to the top or not? Was it physical fitness? The right gear? Managing altitude? Sure — it was all of the above; but to me, it was even more about managing attitude and acquiring that mental toughness. Women have these qualities in spades, though we can sometimes be quieter and less aggressive than men because we have been socialized differently. Just because you’re quiet doesn’t mean you don’t have some great ideas and insights — or that you aren’t a great leader.
As a finance professional, what is the single biggest lesson you have learned from the market mayhem of the past few years?
I look back at the financial crisis and I ask myself, What was at the root of it? Was it bad business models? Inept management? Greed? Reckless risk-taking? It was definitely some of these things, but I think the single-biggest tragedy was the fact that boards of directors and CEOs did not understand the risks they were taking on behalf of their own institutions and clients. Many banks took on risks that they just didn’t understand. One of the hallmarks of TD’s risk appetite is that we won’t take on a risk unless we can clearly understand and manage it. And that isn’t isolated to a few people in the organization; it’s really a matter of being able to explain our business in plain language to our board of directors and our employees. We actually insist that all of our employees understand the basic tenets of our ‘risk appetite’ – the fact that we don’t bet the bank on any single product or acquisition and we won’t take risks that would harm our reputation as an organization. Last year, we had a contest where we invited all of our employees to submit a video, depicting their interpretation of the bank’s risk appetite. The young man who won was from one of our call centres. He did this absolutely phenomenal video, explaining the fact that banks are in the business of taking risk, but that there are limits. In the video, he was building up a house of cards as he spoke, and the conclusion was that if you go too far, it will all fall down. This came from someone on our front lines! It was pretty gratifying for the senior executive team to realize that there was an understanding of risk, not just at the board or senior executive level, but right across the organization.
In the end, culture is key. A great culture is hugely attractive to the best employees: everyone wants to work for a winning organization that truly values people, treats them well and with respect, with a minimum of politics, and where leaders at all levels are real, authentic people. You must have strong leadership and a culture of transparency where people demonstrate unwavering integrity. Those things are extremely important, because when mistakes are made, people can admit it and move forward in the best way possible. If you don’t get the culture piece right, it’s very tough for a big, complex organization to succeed. That’s why we spend a lot of time thinking about our culture.
Colleen Johnston is Group Head, Finance and Chief Financial Officer at TD Bank Group. In 2006 she was elected a Fellow Chartered Accountant (FCA), the highest designation conferred by the Institute of Chartered Accountants of Ontario, recognizing her outstanding career achievements and dedication to community activities. She is the past Chair of the Heart & Stroke Foundation of Ontario and continues to serve on both the national and Ontario boards. She is a member of the Dean’s Advisory Council at the Schulich School of Business at York University and is also a member of the Canadian Board Diversity Council. Editor’s Note: This interview took place in September, 2012.
This article appeared in the Winter 2013 issue. Published by the University of Toronto’s Rotman School of Management, Rotman Management explores themes of interest to leaders, innovators and entrepreneurs. To subscribe: www.rotmanmagazine.ca.
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