THE BISHOP ESTATE TRUSTEES

Are they right
for the job?

Compared to CEOs of
big companies, their qualifications
are questionable

By Jim Witty
Star-Bulletin

Most Bishop Estate trustees have far different business backgrounds than the chief executive officers of Hawaii's top corporations.

Current trustees also lack many of the qualities corporate headhunters say they look for in filling such positions.

The issue was highlighted this week by Chief Justice Ronald Moon of the State Supreme Court, who said justices approach the appointment of a Bishop Estate trustee as though they were hiring a chief executive officer for a major isle business.

"As far as I'm concerned, that's what my criteria would be," he said this week.

Justices said they gave that advice to a "blue ribbon panel" formed in 1994 to screen trustee candidates. The justices ultimately selected Gerard Jervis, an attorney and confidant of Gov. John Waihee, who wasn't on the panel's list. It provoked charges that the selection process has become politicized.

Moon said: "With the information we had at the time, I believe we did our very best."

Top corporate executives in Hawaii either worked their way up through the ranks or came to their posts after working for other major companies. For example, Pacific Century Financial Corp. Chief Executive Officer Lawrence Johnson joined the parent company of Bank of Hawaii in 1958 as a summer trainee, rising to the helm in 1994.

Robert Clarke, chief executive officer of Hawaiian Electric Industries Inc. arrived at the company in 1987 after executive stints at Ford Motor Co., Singer Co., Alexander & Baldwin Inc. and Dillingham Corp.

Of the five Bishop Estate trustees, who oversee a $10 billion charitable trust, one - Oswald Stender - had experience in operating a trust (he was chief executive officer and senior adviser to the board of trustees of the private Estate of James Campbell).

Board-of-trustees Chairman Richard "Dickie" Wong had a 25-year career in state politics and owns a real estate company. Trustee Henry Peters had a 20-year career in Hawaii politics and is chairman of Kamehameha Schools Bishop Estate's property and investment management subsidiary, Royal Hawaiian Shopping Center. Trustee Lokelani Lindsey, the first woman to serve on the board, worked for 20 years as a school administrator and 10 years as Maui district superintendent. Trustee Jervis was a senior partner in a Honolulu law firm, founder of Mutual Mortgage Co. and president of White Hat Development Corp.

What do large corporations seek in a chief executive?

"What they're never looking for is a maintenance person," said corporate headhunter Chris Von Der Ahe, a Los Angeles-based vice president of Korn/Ferry International. "Companies are always looking to move in a different direction, to grow. An important characteristic is strategic vision and the ability to formulate and articulate that vision. They also need to be inspirational and dynamic to get the most out of a staff."

Peter Glick, president of Management Search and Consulting Inc. in Honolulu, said experience is a key.

"If you're recruiting a CEO, you want somebody who has had senior-

level general management experience in an environment of similar size and complexity," he said.

"You don't take somebody from a $10 million company and make them chairman of a $260 million company. They're probably not going to be able to do it. And, often but not always, you'd look for a like industry background."

Von Der Ahe agreed that specific knowledge of an industry is essential. A bank chief executive officer would ideally have worked his way up through all facets of the operation; an ideal chief executive officer candidate for a utility would have experience and a working knowledge of the deregulation process, he said.

"And the candidate would be able to balance both short- and long-term needs," he said.

Oliver Cornell, of Cornell Business Associates in California, said many corporations look for a person with the ability to take over and effect immediate change."Re-engineering is a big watchword now," he said.

Von Der Ahe said a prime candidate would ideally hold a master's in business administration but the intangible qualities outweigh an advanced degree. Cornell said a master's in business administration is almost essential.

Successful applicants are extraordinary people, Von Der Ahe said.

"They have set themselves apart. That's the reason we would consider them as candidates on a search. We look for leaders in the industry."

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Hawaii’s top CEOs
and their credentials

Paul Casey

Chief executive and president of Hawaiian Airlines Inc.

Annual salary: $300,000
Age: 51
Background: Longtime airline and travel-industry executive, including many years with Pan Am and as CEO of Continental Air Micronesia from 1987 to 1991 and as Continental Airlines' vice president for Asia-Pacific from 1985 to 1991. President of the Hawaii Visitors Bureau from 1995 to March 1997. Became president and CEO of Hawaiian Airlines in April.

Robert Clarke

Chief executive and president of Hawaiian Electric Industries Inc.

1996 compensation: $687,311
Age: 55
Background: Early in his career, worked for Ford Motor Co. and Singer Co. Served as senior vice president and chief financial officer of Alexander & Baldwin Inc. and as controller of Dillingham Corp. Joined HEI in 1987 as vice president of strategic planning. Became president and CEO on Jan. 1, 1991.

John Couch

Chairman, chief executive and president of Alexander & Baldwin Inc. Chairman of A&B Hawaii Inc. and Matson Navigation Inc.

1996 compensation: $1.267 million.
Age: 58
Background: Joined A&B subsidiary Matson Navigation Inc. in 1976 as assistant to the senior vice president of engineering and marine operations. Served in a variety of management positions with the company before becoming executive vice president of A&B and president of Matson. In 1985, named A&B's president and chief operating officer. Named CEO in 1992 and chairman in 1995.

Walter Dods

Chairman and chief executive of First Hawaiian Inc. and First Hawaiian Bank

1996 compensation: $1.396 million.
Age: 56
Background: Joined First Hawaiian Bank in 1968 as director of public relations and advertising. Subsequently served a variety of management positions throughout the company. He took the helm of First Hawaiian in 1989. Dods is also the current president of the American Bankers Association.

Lawrence Johnson

Chairman and chief executive of Pacific Century Financial Corp. (formerly Bancorp Hawaii Inc.) and its principal subsidiary Bank of Hawaii.

1996 compensation: $1.281 million
Age: 56
Background: Joined Bank of Hawaii as a summer trainee in 1958 and went through a management trainee program in 1963. He worked in many divisions, including consumer banking, marketing and sales. In 1980, he became an executive vice president. Named vice chairman of Bank of Hawaii in 1984. Before being named chairman and CEO in 1994, Johnson was president of Bancorp Hawaii and Bank of Hawaii since 1989.

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How the trustees
measure up

Gerard Aulama Jervis

1996 commission: $843,109
Age: 48
Background: Appointed in 1994, he was a senior partner and founder of the Jervis, Winer and Meheula law firm, president of White Hat Development Corp. and founder, co-owner and chief executive officer of Mutual Mortgage Co.

Marion Mae Lokelani Lindsey

1996 commission: $843,109
Age: 58
Background: Appointed in 1992, she served on the faculty of Church College of New Zealand and taught at Kahuku High School. She began her administrative career as a high school vice principal and was named principal of Kaimuki High School in 1981. In 1982, she became Maui district superintendent, a position she held for 10 years. She holds a master of science degree in Pacific island studies.

Henry Peters

1996 commission: $843,109
Age: 56
Background: Appointed in 1984, he spent more than 20 years in Hawaii politics, including a stint as Speaker of the House from 1981 to 1986. A U.S. Army veteran, he is on the board of several Hawaii corporations and is chairman of the board of Kamehameha Schools Bishop Estate's property and investment management subsidiary, Royal Hawaiian Shopping Center. He has a degree in business administration.

Oswald K. Stender

1996 commission: $843,109
Age: 65
Background: Appointed in 1989, he spent 30 years with Campbell Estate, the second largest trust in Hawaii, serving as chief executive officer from 1976 to 1988 when he was named senior adviser to the Campbell Estate Board of Trustees. He has a bachelor of arts degree.

Richard S.H. Wong

1996 commission: $843,109
Age: 64
Background: Appointed in 1992, he served in the state House of Representatives for eight years and the state Senate for 18 years, 13 as president. He is a former business agent and assistant division director of the United Public Worker's union and is a proprietor of a real estate company. He has a degree in social work.

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