Shaping courageous leaders: A conversation with Penny Hughes, experienced chair and non-executive director

Welcome to The Heidrick & Struggles Leadership Podcast. Heidrick is the premier global provider of diversified solutions across senior-level executive search, leadership, assessment and development, team and organizational effectiveness, and culture shaping. Every day, we speak with leaders around the world about how they're meeting rising expectations and managing through volatile times, thinking about individual leaders, teams, organizations, and society. Thank you for joining the conversation.

Chantal Clavier: Hello, I'm Chantal Clavier, a partner in Heidrick & Struggles and leader of the Real Estate Practice globally. In today's podcast, I'm delighted to be speaking with Penny Hughes, an experienced chair, non-executive director, and one of the UK's most respected business leaders, known for guiding organizations through periods of transformation, growth, and change across multiple sectors. Penny has built a career leading at the highest levels of complex, consumer-facing, and listed businesses. Today, she brings to our podcast that broad perspective of the real estate sector as a chair. 

Penny, let's start maybe slightly differently to what you're used to with a podcast, shall we? Beyond the board titles and the executive roles, I'd like to know who you are as a person. What experiences outside work have most shaped the way you lead? 

Penny Hughes: Well, Chantal, great to be here. I mean, I think for all of us, obviously, family shapes your first foundation, but I think there's two things that really stand out in my life. One is an absolute world-class education. So, I was lucky enough to go to the same school from 4 to 18, then go to university, [and] receive a first-class honors degree. And my parents separated, and when my father died, there was no inheritance left, but what he gave me was the greatest gift in life, which was the best education. 

Then, the second thing was sports. You know, I've played sports and watched every sport going, and that has enabled me to understand teamwork, understanding I enjoy winning more than losing, but I'm able to go again. And I often ended up as captain. So, you know, how do you perform as a leader? How do you bring the best out of everybody? So, I think my education and my sporting experience are really the foundations that I draw on, then, when I'm in the boardroom. 

Chantal Clavier: I'm intrigued by the way you said, “I often ended up as captain.” It sort of again takes me back to, well how did that happen? 

Penny Hughes: Yes, I was head girl too. 

Chantal Clavier: Yes, right. Here we are. We’re unpacking this, aren't we? 

Penny Hughes: I mean, so I do think leadership starts quite early. I do think obviously you can learn it and you can learn to improve your leadership capabilities, but I think people are kind of born to it, that it is something that you enjoy and don't find daunting. And so the joy of being the captain of the team was something that I, you know, always felt very comfortable with. Do you agree with that?

Chantal Clavier: Well, I do, but I think it has to be brought out of you. 

Penny Hughes: Yes, yes. Your innate comfort with it is there.

Chantal Clavier: But the environments in which you were in, I think, bring them out of you further. So, you obviously went to a school that suited you and suited your personality, so the culture of the environment worked for you. 

Now skipping outside of that a little because you're saying, you know, education and sport shaped you. You've led across multiple sectors throughout your career. Those different experiences, those perspectives, how do you think your leadership style has merged through those particular experiences? Or maybe even yourself, how have you evolved through those leadership experiences, Penny? 

Penny Hughes: So, in those early days, and I suppose my most noticeable early executive role was leading the Coca-Cola Company in Great Britain and Ireland when I was only 30. I guess, I felt I could win every day, and if I was a player on the football team, I'd have been the center forward wanting to put the goals in. And I suppose, then, understanding that no business goes in a straight line upwards all the time, and that you have to deal with different economic cycles and setbacks. 

And then when, you know, you find yourself as a director of [Royal Bank of Scotland (RBS)] post-financial crisis, and you're on the risk committee and there's a hundred board meetings, you then realize actually you've got to be much more rounded and you've got to play as well in defense as you do in attack. And so I guess I was a, you know, naïve, running-fast early leader, who has learned now to have a bit more balance and a bit more poise. 

Chantal Clavier: And again what I hear coming through that, very positive, you know, mental attitude that you had, and again a pretty young age to have such leadership roles, too. 

Penny Hughes: Yes. When I look back on it, you know, I do think the Coca-Cola Company was quite brave to appoint me. I was not only the youngest, but also the only female at that level. But when it's you and you feel you can do it, it doesn't feel like that. You don't feel as though you stick out, you just feel as though you've got a job to be done and that you're confident you can do it, and so you should crack on and do it. 

Chantal Clavier: Where does that come from? Where does that inner belief come from? 

Penny Hughes: Well, it's interesting. A lot of business leaders that I work with do study history as a guide to the future. That's not me, you know, I dropped history. I only ever read sort of autobiographies to learn from peoples’ characters and decisions they've taken. And so I don't lose myself either in history or even in drama. I'm real and I look forward. Even if I make mistakes, they're mistakes I've learned from and we go again. And so it's just that attitude of looking ahead that has helped me to maintain that positive approach. 

Chantal Clavier: Let's touch on the mistakes, and we don't need to have a catalog of them, obviously. I'm sure there aren't that many, actually, Penny. But if you were to think of one or two that have really been helpful, you know, they might have been terrible experiences at the time, but actually they've been really helpful for you, either as a person or as a leader, what might you cite? And bear in mind the listeners, so that you're passing on maybe a nugget of advice for them. 

Penny Hughes: Well, I think if anyone scrolls my career, there will be some raised eyebrows at being the chair of Aston Martin when we listed, and obviously that was unusual. I didn't have any car experience, but I had a lot of brand experience. What none of us understood was how quickly the company would become stressed. And when I say none, obviously, when you're listing a company as an IPO, you have every banker, every lawyer, every accountant crawling all over the company. And so I felt that the incoming board had done all the diligence that was necessary but, of course, within three months it was clear that the future of the company was not sustainable, not as strong as had been anticipated. So, the work I did eventually to have Lawrence Stroll come in as a major investor and, indeed, take over from me as chair, I was right on the frontline with someone who, you know, is immensely powerful and well-known. And this was also through Covid. And so I suppose yes, I now look back and think [about] other things I could or should have done before I did that role, but actually did I deliver and turn it round and put the company back in a position whereby it had the leadership and funds it needed? Well, yes. So, you just have to find solutions. 

Chantal Clavier: Yes, absolutely right. And again I'm hearing that very pragmatic, positive, almost fighter in you coming through as you're talking. As a woman chair, I personally believe you get a higher profile, whatever industry. Does this make you more exposed at tough times, just going back to maybe the example you gave, or another? Do you feel more exposed as an individual? 

Penny Hughes: So, it's taken me quite a long time to accept that I might be a sort of female role model, because again it's just who I am, what I do, and I feel blessed to have had the experience that I've had. And so, yes, I do now accept that, you know, being a female leader during this period of time has brought its own sort of visibility and attractions and so forth. 

But I haven't really felt that that has been a handicap, because for the moments that it's a handicap, there are also moments where it's a benefit. And I, you know, have found the odd person along my career path who has found dealing with women a little bit difficult, but I found my ways around that. And I've also found that that is often accompanied with someone who doesn't deal with change very well, in which case it's not just really about being a woman, it's about embracing change. And so that's really why I try [to] tackle it that way. 

Chantal Clavier: That's very mature, it's also very thoughtful. Again, what I hear or how I interpret that is that you're almost taking a step back from situations and analyzing them. Is that something that you reflect on or you do quite a lot?

Penny Hughes: Yes, it is. I mean look, I sleep well at night. 

Chantal Clavier: That’s why you look so good. 

Penny Hughes: I don't lose sleep, you know, even in stressful moments and stressful days, I sleep well, so things don't churn. But I suppose because I started this plural career 35 years ago now, I've got possibly as much experience as anyone in the boardroom, and so that's really what I use. 

Chantal Clavier: Let's talk about the groundedness. So, where I'm going with this is we've spoken about some of the visibility, the scrutiny, the pressures, and you've said, you know, you sleep well, you're good, you get through these things and you find a way through. And actually you seem very balanced in yourself, even as you're sat in front of me talking about some of these difficult times. 

Penny Hughes: Yes. 

Chantal Clavier: How do you do that, Penny? How do you stay grounded?

Penny Hughes: Again, I think it's probably just part of my character, you know, I've never been driven by financial rewards. I've always been driven by doing the right thing and making a difference. And so, so long as I know that that's what I'm doing, then that's where I get my confidence from. Obviously, I've got a stable home, a lovely husband, two kids, you know, adore them all; and so they've been a part of this journey just like, you know, I have. And I suppose I just always thought be yourself and do the very best you can. And the important part of that, Chantal, of course, is having the right people around you, both your own executive teams, but also your advisors, and obviously you're part of that. You know, when I've been in tight spots, you know, whether you need to replace a CEO or whether you need advice from a lawyer or whether you need market advice from a banker, I've got a network that I really trust. You're in it, and that's what helps me know that I can navigate things. I'm not alone. 

Chantal Clavier: You are not alone. We certainly very much enjoy working with you. And I would add to that, you know, you're a great person to work with, actually, because you are transparent and communicative, and you use your advisors in exactly the right way. So, it's interesting that you say, “I have that network around me and I use it and I lean on it,” but I think in return the advisor feels that you are listening, that the advice matters. And I do think that there's a lot in that, Penny, just as, you know, feedback too from our side. 

Penny Hughes: Oh, that's kind. So, when I did the arrangements with Lawrence Stroll, one of the things Lawrence said is, “I don't employ large teams of people. I have one lawyer and one accountant, so that's all you can have, Penny.” And I said, “That's great, you know, I don't want to waste money on many more.” And so all of those arrangements were done with six people in the room, and that is so energizing, because you can get stuff done. 

Chantal Clavier: There is an energy point here. You do come into a room, you know, you light it up. It's sort of obvious to me, you do bring energy and magnetism, charisma. Are you always on or do you sort of pull away in your personal life and retreat a little bit and charge those batteries? Or is that charisma something that's sort of permanent with you? 

Penny Hughes: You know, I do what I do because I enjoy it, and so that's really, I think, what you're reflecting on. Am I always buzzing at every social event? No, of course I'm not. But my energy in business comes from my real desire to make a difference and reach good conclusions, and I find that exciting. 

Chantal Clavier: And other than sleeping really well, what else are you doing, whether it's physical, whether it's, you know, reflective; it could be hobbies, it could be something that you feel is really important to helping you as an individual stay healthy, well, stabilized emotionally and mentally? Are there secrets to your backdrop? 

Penny Hughes: Well, it's back to my sport. Obviously, I stay healthy. I do spin classes, I do Pilates, you know, I play golf, and that's a really good four hours that you spend, you know, focused on something completely different. I find skiing fantastic, because when you're throwing yourself off the top of a mountain, there's no way you're thinking about anything else, you know, the phone is gone. 

And so yes, I am completely able to take a break when I do my own physical fitness, for me. I guess the other thing is the family. So two boys, they're now 29 and 31, they've played every sport going. You know, I haven't missed many cricket matches, football matches, rugby matches, and so forth, and they are those special moments. So, finding a way of balancing those things, I think, is what's helped me. 

Chantal Clavier: You mentioned going early, if I can put it that way, into a non-executive pathway. I imagine that plenty, particularly women, but plenty of men and women will come and seek your advice around that. What do you often say to them in terms of how to get their first non-exec role or how to get their first chair role? 

Penny Hughes: So, it was interesting, Coca-Cola was very generous. Obviously, I knew that I was pregnant with our first son, and I talked to them and I said I think this is likely to mean that the next role for me inside Coca-Cola would have been going to Atlanta. I didn't want to do that at that stage of life. So, they knew that potentially I was thinking that I would not return after maternity leave. They were very generous. They said, “Well, if you want to go and do a non-exec role so that you know what it's like before you make that decision, please do. But of course, it can't be a customer of the Coca-Cola company.” Well, there aren't many companies in the world that aren't. So, actually that narrowed it down really well. 

So, my first role was with Anita Roddick [at] The Body Shop. Of course, they weren't customers but they were a consumer global brand, a franchise, so there were lots of things that I could bring and I could offer, but obviously this was a very different sector and a very different creative culture. I absolutely adored it. And that's really what gave me the confidence to say, “Yup, I'm not going to do that executive role anymore,” because I can make a difference as a board director. One of the first things that Anita and Gordon Roddick did was to try and buy the business back again. And of course I'm the only non-exec director on the board, and so I'm then representing shareholders, setting a price, which they couldn't achieve. So, I knew this was real work, I knew there were real responsibilities, and that I could combine that with family and with using my experience in a way that would satisfy me. 

Chantal Clavier: That's all outside of real estate, isn't it? 

Penny Hughes: It is. 

Chantal Clavier: You entered the real estate sector fairly recently, as such, then. What advantages does an external perspective bring to a real estate board? 

Penny Hughes: So, you said I entered recently, that's true in a pure play sense, but obviously I've had lots of multisite retail, multisite leisure.

Chantal Clavier: Absolutely. 

Penny Hughes: Even my work at RBS, you know, where all of the property portfolio in the bank, huge.

Chantal Clavier: Yes. 

Penny Hughes: So, when I first became chair of IQSA, yes, it was my first sort of pure play, but I felt ready to manage what I call both a consumer business and a balance sheet business. So, [it is] important that you understand and are capable of making those balance sheet decisions around investment in assets. But equally important is, you know, my consumer experience, particularly for the two that I've now experienced, both student accommodation and now at Riverstone Later Living, these are operating platforms that are really delivering experiences for students, for people in later years, which are absolutely shaping their lives. And so that responsibility and that ability to prioritize service and security, as well as making real estate decisions, I think has enabled me to cross that boundary. 

Chantal Clavier: And they seem to have purpose, both of those businesses, too. 

Penny Hughes: Massive purpose, massive purpose. I mean the responsibility for students, you know—for many, this is their first experience away from home and their mental health problems are things that you have to face into and know that you can't just say, “Here's your room, thank you, good night,” you know, you are looking after the health and security of those students. And again, we did that through Covid. That was quite an experience. Likewise, with Riverstone, you know, people are making perhaps their final large decision in life about where they live and how they live, and we're helping them make that in the most positive manner. But obviously we're there, you know, for the safety net of aging. And so that's a real responsibility and doing that well is what we have to do. 

Chantal Clavier: The real estate industry, whether it's the purest aspects of it or the operational aspects of it; I mean actually, Penny, as you're talking I'm thinking wow, all of that experience, and then look where the real estate industry has shifted to over the last decade, in particular, I mean you're right in the moment, aren't you? Profound period of transition economically, socially, operationally. From your perspective as chair, what are the most important leadership conversations boards should be having right now?

Penny Hughes: So, that change has brought much higher costs, lower prices, much longer timescales—whether it be planning or construction. And so I think you have to be able to deal with the here and now because businesses are stressed, but fundamentally, if this is the new reality, how do you change your business model to ensure that the business can thrive three to five years out? And that's really what I think a board has to deal with, not just get focused on today's decisions, which seem urgent at the time, but ensure that you are rethinking what the future needs to be. 

Chantal Clavier: So, does that mean that you need different people around the table? Does that mean that as you think about that board today versus that board 10 years ago, have you shifted in how you think [about] who needs to be with you on that journey, or does it feel much the same?

Penny Hughes: I think you're right. I think a little grey hair, a little experience, a little been-through-cycles-before at a board is really helpful. On the other hand, youth, AI, tech is also super helpful. So, I think it is about combining those things. It's not necessarily different, but it's ensuring that as a team you reflect the needs of the environment you're working in. 

Chantal Clavier: Shifting into the executive team, what do you think differentiates very successful leadership teams from other leadership teams?

Penny Hughes: Well, my first word here is courage and, you know, if I think I was on the Vodafone board when we went from a million handsets to 150 million handsets, led by Chris Gent, I think the first word I'd think about for him would be courage. And I think the same as Stephen Hester, being the first CEO of RBS post-financial crisis—courage. And so having that courage to lead at difficult moments and do outstanding things, I think puts people apart. 

But courage requires confidence, and so confidence, I think, is a critical barometer. You need to be able to make decisions [that] feel well-centered and be able to do that on a quick timetable, because you've mastered it. Then, I think resilience: go and go again, because not everything turns out the way you hope it might, and so you have to abandon plans and go again. And that ability to put aside things that you thought were important and refocus on other things that are more important, I think, is critical. 

And then, of course, people leadership, because none of us do anything on our own. And so the ability to select and lead a team and create a culture where people really feel energized and empowered to give their best. 

Chantal Clavier: How do you create an environment as the chair, where executives feel supported, held, to use your term, but also constructively challenged? 

Penny Hughes: So, I think this is a critical skill for a chair. The way I go about it is, you know, my deal with my CEOs is I'm here as a team colleague supporting you for as long as I then have to determine that there's a different path. So, until then, I'm not going to try and double-guess you every day of the week, because that's just unproductive. But what I am going to do is, we are going to meet every week, I'm going to get to know you as a person, know what's on your mind, whether it be personal or professional. And that will enable us to have some very honest conversations, which can be challenging but without you feeling threatened, because they're in a kind of safe environment. It's a lonely place being a CEO, so being able to have those honest conversations, I think CEOs really value, but you have to create an environment where [it's] okay to talk about difficult stuff. 

Chantal Clavier: People talk quite a lot today about authentic leadership. Sometimes I'm not really sure what that means, to be truthful, but anyway, it's a term. In your experience, what does authenticity actually look like in practice? 

Penny Hughes: Well, I think I'm with you. I'm not sure either, but if I had to say it, it's really just being able to be yourself, just call it out the way you want to. I have a wonderful non-exec on the Riverstone board, Natalie-Jane MacDonald. She's just brilliant at this, you know, I might not have spoken to her for two or three weeks, and then she'll come up with something that is just genuinely born out of care for the business, but it's a different perspective. And so I just really enjoy when people feel able to not just tow a party line or bring the same perspective, but actually bring different and fresh perspectives, it’s truly valuable. 

Chantal Clavier: You know, what I'm also hearing there and you've actually said it in this time we have together, where you said you love what you do, but you [also] give the care because you're giving quite a lot of time, you know, when you say I meet them every week or it might be quite a long time until I see somebody, i.e. two or three weeks. I was expecting you to say sort of two months, actually. It just landed with me and I thought wow, you really do spend the time, like you give a lot. 

Penny Hughes: Yes, I do. I have to make sure that I don't overstep the line, and perhaps this is one of the differences between a PLC chair and a private equity chair. So, I think as a private equity chair, I mean you're not an executive chair but you are absolutely on the line. I think what the governance sort of community in PLCs has made very clear is the separation between the CEO and the chair is profoundly important, and probably chairs in PLCs do not get as engaged as I have. And so I think there is a difference. And so I think I perhaps didn't plan it this way, but I'm really joyful that my work is now private-equity backed, because I think that's giving me greater rewards in terms of the contribution I can make, but without absolutely crowding out, rather supporting the executive team. 

Chantal Clavier: Makes a lot of sense. If you had to share three life lessons with the next generation of leaders, particularly women aspiring to be senior leadership in board roles, what would be your three life lessons for those people that might be listening? 

Penny Hughes: So, I always say the very first thing is you've got to find something you really enjoy, because if you enjoy it, you'll give your best, you'll look forward to it, you know, you'll be able to smash it out the park. You've got to be able to have, you know, common values. And so I've been in circumstances, only a couple, where I didn't share the same values as my colleagues, and that's just uncomfortable. And so, you know, bring those to an end. So, I think find things you enjoy, where you feel as though you can really give of your best. 

Second is, you have got to have some brilliant moments, you know, there's got to be something about you and moments where you have absolutely been the difference. So, my first sort of brilliant moment was I was the first executive at the Coca-Cola Company that was allowed to do my own local advertising in London, you know, at a time when global advertising was all big global brands did. And that then swept the world because we did advertising, we're in the World Cup now, there was a World Cup then. I did some football advertising, because obviously, as we're seeing, the difference between the way the U.S. takes on football and the way the UK embraces football, you know, is still so different but was even more different 35 years ago. And so to be able to create some advertising which really resonated around youth, about Coca-Cola's participation in football, I mean I had, you know, the South American leaders, the Brazilians, you know, absolutely on their feet, clapping when they saw it. And that was the biggest message to the Coca-Cola Company, that actually it couldn't just do a global brand, it did have to think local, it did have to interpret more locally. 

And I think, you know, I've got several more moments in life, but you do need to have some brilliant moments where you are the difference. And so again, find something you enjoy, but then find a way to be brilliant at it. 

And then I suppose the thing that I've learned in the last 10 to 20 years is, you know, you can't win all the time, and so you do have to go and go again. You don't always make the right decisions, you don't always pick the right people, you don't always pick the right companies, and so learning from those lessons, but going again and having that resilience I think, you know, and turning up with energy and commitment to go again is really important. 

Chantal Clavier: I don't know which of those I love the most, but I do love all three. I'm going to go back to one, actually, you said, “Enjoy, give your best, align yourself with something that feels aligned to your own values,” which clearly is going to resonate with so many of our listeners. But what I want to unpick within that, actually, Penny, was you said, “If it doesn't, you know, end it,” and I thought that's actually really hard to do, though. So, can we just unpack that a little bit? How do you work out in some ways that it doesn't align? And then how long do you give it, and how do you end it? 

Penny Hughes: So, the experience that probably amplifies this the most, I was the director of the Next Company a long time ago. Simon's father was the chair at the time, David Jones was CEO. They were running a good business. They didn't want a board. Board papers were on two sides of a piece of paper. And my other two non-exec directors were City and a different kind of context. They were not plural non-execs. The business was being well run, they were not particularly troubled by not getting much board information. That's not a way I could work. So I did, I brought that to an end. 

Chantal Clavier: So, how long did you give that? 

Penny Hughes: Two years. 

Chantal Clavier: Two years. Okay. 

Penny Hughes: Two years. 

Chantal Clavier: And then, and then you just came forward and spoke your truth, or you had been feeding the idea that it wasn't working? How does it unfold? 

Penny Hughes: Feeding the idea. 

Chantal Clavier: Okay. 

Penny Hughes: You know, asking appropriate questions, you know, putting out what my expectations as a director are. But, you know, I don't get to what I call head-butt situations because, you know, there's so many other things in life to do. And so, you know, be truthful to yourself, and if you can't get what you want, move on, move on. 

Chantal Clavier: So, that courage that you're talking about is there, but there's also a style with that, you're gracefully moving on. 

Penny Hughes: I hope so. 

Chantal Clavier: I love that in particular. And your other pieces of advice, you know, do something where you're the best, the moments, pick them out, and you can't win all the time. But to your own admission, that's been the last 20 years of accepting that piece. It wasn't something that you innately had from the beginning. 

Penny Hughes: Correct. 

Chantal Clavier: You've learnt that. 

Penny Hughes: I've had to learn that, you know, that's my difference between moving from center forward to center back. I've had to learn how to defend, learn how to mold a team and know that, you know, going again is what's important. Celebrate success, don't cry about failure. 

Chantal Clavier: Wonderful, Penny. Thank you so much for making the time to speak with us today. 

Penny Hughes: It’s been a joy. It's always fantastic to see you. 

Chantal Clavier: Fantastic pieces of advice for people, so thank you. 

Thanks for listening to The Heidrick and Struggles Leadership Podcast. To make sure you don't miss the next conversation, please subscribe to our channel on your preferred podcast app. And if you're listening via LinkedIn or YouTube, why not share this with your connections? Until next time.

About the author

Chantal Clavier (cclavier@heidrick.com) is a partner and leads the firm’s real estate sector within the global Financial Services Practice; she is based in the London office.