NZ needs Luxon to embrace chairman’s role

Mounting domestic pressures will require PM to extend CEO style

Christopher Luxon’s challenge in 2024 is to prove himself to be the leader New Zealand needs to get through some rocky economic times ahead, yet at the same time lead the long-term transformational change this country obviously needs to compete in the post-Covid world.

The challenges the Prime Minister faces are not for the faint-hearted.

New Zealand is once again skirting economic recession. Redundancies are piling up, cost-of-living pressures are biting as the full weight of mortgage costs are brought to bear on homeowners, and housing supply is again under pressure off the back of increased immigration.

Then there is the political challenge Luxon as Prime Minister will face dealing with the mounting backlash to policies negotiated by National’s coalition partners such as Treaty issues (Act) and the culture wars (New Zealand First).

These mounting domestic pressures will require Luxon to go well beyond his current leadership style as chief executive of Cabinet and also embrace the chairmanship persona required of successful prime ministers; attuned to the concerns of multiple sectors and responding to them carefully while at the same time maintaining the momentum and clarity to deliver on the Government’s own ambitious policy agenda.

It is a political truism to claim that charismatic leaders are best placed to take a country forward in such circumstances.

For instance, former Labour Prime Minister David Lange provided political cover for Sir Roger Douglas’ hard-edged economic reforms.

Charismatic leaders are also charming masters of communication and are extremely confident, as Dame Jacinda Ardern proved to be during the initial stages of Covid-19 where she successfully persuaded New Zealanders that lockdowns were in their best interest.

Unlike Ardern, who had risen to power fuelled by media-driven “Jacindamania” (yet retired from politics early after it became clear her leadership in its latter stages had polarised New Zealand), Luxon must rely on the skilful execution of Government policies to cement his leadership. It is worth recalling that Lange also resigned his prime ministership. Charisma may get a team over the line, but it only takes you so far in politics.

Counter-intuitively, the fact Luxon is not a charismatic leader is a political asset. He can’t rely on passion or glib one-liners. It means he has to concentrate and deliver on the challenges at hand.

Luxon enjoyed a “command and control” style of leadership as CEO of Air New Zealand for eight years.

He has studied the leadership styles that have been voguish in the corporate world, such as “servant leadership” — where, as President Joe Biden through a political lens observes, you always put yourself in the other person’s position and seek to understand where they are coming from, whether it’s a foreign leader or a friend you disagree with.

It’s also being willing to share credit, give recognition and share in the benefits as well as in the losses if you’re in an endeavour together.

Arguably, Luxon had to draw on a similar set of skills when forming the coalition Government.

Successfully negotiating dual coalition agreements with New Zealand First leader Winston Peters and Act Party leader David Seymour showed his skill at working with disparate people hewn over a 30-year career in the corporate world.

He was sufficiently attuned to their political needs to pay both of them obvious respect when the coalition agreements were unveiled and has since left each to front their own policy agendas.

But he does have weaknesses. When Sir John Key decided to run for national politics, he called his wider family together to impress on them that he could be judged by any blemishes that may emerge.

Key put his shareholdings into a blind trust. Although his use of foreign trusts was later criticised by opponents, he was not savaged by news media for being obviously wealthy with a huge house on St Stephen’s Ave in Parnell and holidaying at his residences on Maui and at Omaha beach.

In other words, he swept the decks.

Luxon has attracted opprobrium from opponents for having eight houses, including investment properties, and a wife who claimed an EV rebate. This is unfair but it does highlight he faces more personal criticism than his forerunners.

And yet the sheer continuance of the oppositional style that key

Cabinet ministers employed in Parliament in late December, as the Government repealed Labour’s prime policies, has already proved tiresome.

When Luxon presides over his first Cabinet for 2024 on Monday, January 15, he would be smart to ensure he has some policy programmes to discuss at the resultant press conference.

All prime ministers must rely on trusted confidantes to give them reliable advice.

At this stage he has delegated major responsibilities to those in his inner circle, such as Finance Minister Nicola Willis and third-ranked minister Chris Bishop. These Cabinet ministers, together with Simeon Brown and Paul Goldsmith, are said to form Luxon’s kitchen cabinet.

Here’s hoping in New Zealand’s interest they put their best feet forward in 2024.