The outrageous conduct of the Air New Zealand board gets very interesting when you realise that ANB Bank chairman and prominent Liberal Party donor Charles Goode is on the board representing his friends in Singapore. This excellent piece that Eric Ellis wrote for The Australian a few months back puts it all in a very interesting context.

Gilbert Lau’s restaurant has long been the Melbourne power elite’s Asian restaurant of choice, serving that very Melburnian blend of expense, panache, exoticism and occasion that defines the cultivated tastes of Toorak and South Yarra.

Or it might be that it’s just a short walk from the Melbourne Club, a shorter walk still for from the headquarters of the ANZ Banking Group, the bank around which the elite coalesce and where 62-year-old Goode has been the chairman since 1995. Nor is it far from the office of Woodside Petroleum, where Goode has been chairman since 1998 and a director from 1988.

Goode lunched on Wednesday at the Flower Drum — usual table please, Gilbert — with two special friends from the Land of Lee Kuan Yew: Dr Cheong Choong Kong and Michael Tam, chief executive and executive vice-president respectively of Singapore Airlines.

Goode is the only non-Singaporean director of SIA, the national treasure controlled by the Singapore Government. Goode has been on the board for almost two years, there to impress, attract and influence important people, be they in business or politics.

And his Singaporean guests were dining with a man at the peak of his powers. A day earlier, Goode, the Woodside chairman, made statesman-like remarks lauding federal Treasurer Peter Costello’s rejection of energy giant Royal Dutch Shell’s $10 billion bid for Woodside Petroleum on the grounds that it was against Australia’s “national interest”.

A day later, Goode, the ANZ chairman would have “great pleasure” in announcing record profits for the bank.

Singaporeans love this sort of stuff. Tiny Singapore is an urgent country absorbed by the constant need to position itself at the centre of “The Things That Matter”.

To Singapore’s power elite, the world is less a family of nations than a club of powerful individuals. And in the life-long Liberal Party benefactor Charles Goode, occupying since 1999 a unique role at SIA, they’ve got a blue-blooded member of that exclusive club whose phone calls are always returned.

But Goode’s Singaporean guests could be forgiven for pressing Goode for his definition of “national interest”. It’s a term that has disquieted Singapore, often used against its mostly government-owned premier companies when they’ve tried to make deals abroad in Singapore’s national interest.

Goode seems uniquely placed to answer both, apparently contradictory, sides of the national interest issue. That’s because he’s sat comfortably on both sides of the argument. Witness this week’s response to Costello on Woodside:

“While globalisation is part of commercial life today, I believe there is a line to be drawn by the Government at some point with respect to the national interest. In the context of retaining an Australian identity within our community and having decisions in relation to key national assets made by Australian citizens, I can well understand the Government’s decision.

“While the Government’s decision with respect to the national interest may not be popular internationally, I believe it will be understood when viewed in the light of the special circumstances of the particular case.”

And in December 1998, wearing his ANZ hat, Goode implored Treasurer Costello to maintain the so-called “four pillars” ban that would prevent consolidation of the big four banks, Westpac, Commonwealth, NAB and his own ANZ.

“Foreign acquisitions would have the potential to impact on Australia’s national identity and the Government would need to give this careful consideration,” he said.

Treasurer Costello — another man who understands how power courses through the Melbourne corporate elite — seems to agree. The four pillars remain in place. But there he was throughout last year last year, at the side of his two Melbourne lunch guests, SIA CEO Cheong and vice-president Tan, trying to convince a sceptical New Zealand Prime Minister Helen Clark it was in NZ’s national interest to approve the sale of its flag carrier Air New Zealand to SIA.

Clark has objected to the full sale on the grounds that the airline was “effectively controlled by the Singapore Government”.

New Zealand maintains its national interest is served by keeping SIA’s stake at just 25 per cent. It has repeatedly denied SIA’s attempt to go to 40 per cent. So trusted is Goode at SIA, he guided the company through the difficult days that followed the Flight SQ006 crash in Taipei last October.

Board members had gathered for an Air NZ meeting in Christchurch but flew back to Singapore to deal with the crisis. Goode stayed in New Zealand as SIA’s representative at the meeting.

Through Australian eyes, Goode’s comments suggest that if Singapore was after a committed globalisationist, they may have hired the wrong man.

But the way Singapore sees it, he’s embraced their business community’s almost Jekyll-and-Hyde skill of being on both sides of an issue – and seeing no contradiction or conflict with it. Indeed, as Goode told The Australian this week: “I see part of my role at SIA as advising it on strategic issues as Singapore embraces globalisation.

“It has been stated by the authorities that Singapore business has to go out into the world and I suppose they are engaging people like me, who can bring a different and — if I can say it — a Western perspective to that activity.”

As “Corporate Australia” is quickly coming to understand it — as Singapore bids for more of its assets such as Optus, Sydney Airport, Ansett — what would seem a conflict in Australia is regarded as part of the successful “Singapore model” in the island state’s business world.

Consider some of Goode’s colleagues on the SIA board: in recent months, they include the active head of Singapore’s defence forces and the permanent secretary of the Health Ministry. Current director Koh Boon Hwee sits on 47 boards and also chairs the Government’s corporate governance board that recently decided against imposing upper limits on the number of directorships held.

Another director, Tjong Yik Min, sits on the Civil Aviation Authority of Singapore, which regulates SIA. What’s unusual about Goode’s appointment in Singapore is that he is Australian. In a country that takes brand names very seriously, Americans are the power-players of choice.

After that come Japanese and Europeans. Asians and Australians rank well down the preferred list. Goode insists his journey to the SIA board was a fairly simple one. He says he received a letter “out of the blue” from SIA chairman Michael Fam asking for an appointment to see him. Fam flew to Melbourne to offer him the directorship.

“I was flattered. I don’t know how I got on their radar screen — honestly.”

Simple perhaps, but the ties between Singapore and Australia, and especially Melbourne, are long and deep. And Michael Fam, a trusted hand in Singapore, seems the connection. University of Western Australia-educated, Fam probably came onto the Melbourne establishment radar in the 1950s and 1960s as he rose to be executive chairman of engineering group Humes Industries Far East, a profitable associate of Melbourne-based Humes Ltd.

The board was a parking lot for Melbourne Club members until being subsumed by Smorgon Consolidated Industries. A long-time chairman was Colin Harper, who was also on Goode’s ANZ board for 23 years until 1999. Fam is also a director of Singapore’s Oversea Chinese Banking Corporation, recipient of one of the foreign banking licences offered up by then treasurer Paul Keating’s 1985 “big bang”.

OCBC was based in Melbourne at a time when Goode’s long-time employer, stockbroker Potter Partners, dominated Melbourne business.

But perhaps the most celebrated of Fam’s sorties to the Antipodes — apart from hiring Goode — was to New Zealand, a connection which in the circuitous, but always connected, way of business leads Charles Goode to the board of Air New Zealand. In the early 1990s, Fam was CEO (he’s now chairman) of Singapore’s Asia Pacific Breweries — of Tiger beer fame — a joint venture partner with Brierley Investments in the Kiwi pub and brewing group Magnum.

Magnum’s later sale formed part of a succession of related deals through which emerged the Lion Nathan group that controls about half the Australasian beer market. Interestingly, the CEO of Magnum for a time was a bow-tied executive called James Strong, in transit between running the Australian mining industry lobby and the top job of turning around Qantas, SIA’s big competitor in Australia and New Zealand.

Fam was instrumental in securing the investment in BIL of Singapore’s premier state investment companies — the Government Investment Company chaired by Lee Kuan Yew and Temasek, the state holding company and its prized government-linked companies, including SIA.

It’s rare today for Singapore Inc to invest offshore but it was virtually unheard of 10 years ago. It speaks of the pull Fam, a former Temasek director and current member of Singapore’s Council of Presidential Advisers, has on the island.

But it’s been a generally poor investment for the Singaporeans, coinciding with the decade of decline of the once-mighty BIL.

But the BIL connection did shake free a gem for Temasek’s prized offshoot, Singapore Airlines last year — 25 per cent of BIL’s 55 per cent stake in Air New Zealand. BIL is now headquartered in Singapore, under the watchful eye of its government shareholders.

It recently built a stake in the Singaporean beverage group Fraser and Neave, an associate of Asia-Pacific Breweries and also chaired by Fam.

Charles Goode insists there’s no inherent contradiction with his views of what does and does not constitute national interest. He says he judges such matters case-by-case but, more importantly, on “what will advance the cause” of whatever company pays him to be a director.

Ever the diplomat, he finds his SIA colleagues “of the highest calibre” and he says he “enjoys very much the opportunity to serve and contribute”.

“They are very competent people,” he says. “I find it very interesting.”

* Eric Ellis is a columnist for Time and Fortune Magazine from Singapore.

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