Long-term staff quit over venture fund’s toxic culture, review finds

A report into workplace culture at a government-backed venture capital fund found some staff were so unhappy they quit without new jobs to go to and even lied about why they were leaving to avoid retribution.

On Thursday New Zealand Growth Capital Partners (NZGCP), which invests hundreds of millions of dollars into early-stage companies, released a report by former Employment Court judge Graeme Colgan.

It found instances of “low-level” bullying as well as “widespread perceptions of discrimination based on gender . . . [and] repeated instances of disrespectful and inappropriate workplace culture”, Colgan wrote.

“There have been observations by some staff that the workplace culture is an ‘Alpha male, toughen up or get out’ culture that thrives on individual competitiveness.”

Initially the fund — established in 2002 and previously known as the Venture Investment Fund — refused to release the report, but hours later released it under the Official Information Act.

Although Colgan was not preparing findings about the workplace behaviour — because staff were interviewed anonymously those who were the subject of claims could not contest them — his report detailed perceptions of a male-dominated culture which affected pay and promotion, of “inappropriate workplace conduct” and a board which was seen as too close to senior management.

The report does not name any staff member or board member.

In early August, Shortly before Colgan was appointed, chief executive Richard Dellabarca quit abruptly after more than four years in the role, which the organisation said was to return to the private sector.

Murray Gribben, who had been chairman of NZGCP, briefly became interim chief executive. When he took up the role he said the fund “and its operations are progressing in a way which is exceeding expectations”.

By January the entire board of NZGCP had quit, not long after it emerged that Dellabarca’s announced replacement, Daria Murray, was no longer taking up the role.

NZGCP refused to comment on the report beyond a statement which said it was “making significant progress” towards carrying out the recommendations and expected the process to be completed by the end of June.

Prompted by statements made by three staff, the report found instances of “low-level” bullying and while it did not find evidence of harassment, Colgan said the culture was toxic to the extent it prompted staff to leave.

While some had left for innocuous reasons, multiple corroborated accounts of current and former staff “reveal sometimes intense dissatisfaction at their treatment as the prime and sometimes sole reasons for their resignations over recent years”.

Colgan found it was telling that “loyal, long-term and valuable” staff would quit without jobs to go to and that when they quit they would give bland reasons as to why or “even false ones [which] attests to their stated fears of retribution in the relatively tight venture capital sector”.

After interviewing more than 30 staff, Colgan said he had heard staff were reluctant to question company leadership because they feared an “antagonistic and personal” response. Inappropriate behaviour — described as akin to boarding school initiation — was perceived as bullying. Colgan even documented perceptions of “racist behaviour” in the context of initiation rites in the Auckland office, without providing details.

Multiple staff believe there was “an inappropriately close relationship” between the board and leadership, meaning they did not have confidence complaints would be actioned.

Part-time staff who worked significant overtime reported problems in getting payments approved.

Key performance indicators were deliberately abandoned “in favour of arbitrary informal discussions but without meaningful (or even any) records being kept of these” a move which, while agreed with staff “does not speak to good management in this regard”.

As part of the response, the board of NZGCP said it would develop guidelines about how staff were expected to behave as well as a strategic plan for the business.

It would also establish a short-term incentive plan “establishing clear, consistent and measurable targets for all participating staff ”.

There have been observations by some staff that the workplace culture is an ‘Alpha male, toughen up or get out’ culture.

Graeme Colgan, in report on govt-backed NZGCP