Alan Kohler’s extraordinary Cathy Walter column
Sealed section March 23

Alan Kohler had an extraordinary column in today’s Age/SMH which
really turned up the heat on former National Australian Bank audit
committee chair Catherine Walter who is fighting a rearguard campaign
to stay on the board.

We say extraordinary because Kohler talks openly about who was the
source of a controversial column on March 10 which came indirectly from
a director and attempted to undermine the then upcoming
PricewaterhouseCoopers report into NAB’s $360 million forex loss.

Kohler writes:

“In fact the NAB board believes that because of that expectation she
[Cathy Walter] tried to undermine the credibility of the report by
leaking – to this correspondent – that there was dissent within the
board about PwC’s independence.

“There was, indeed, plenty of disagreement but we now learn – thanks
to my colleague Malcolm Maiden’s story over the weekend – that it was
Cathy Walter versus the rest.

“For the record, contact with me was made through a third party; I
did not know who was behind it and still don’t (although Cathy Walter
seems to be a fair bet).

“And as discussed in the context of the Telstra board leak about the
abortive Fairfax deal a few weeks ago, no board can tolerate leaking.”

Read Kohler’s full column here:

Crikey hears that Catherine Walter has a difficult relationship with
Craig Hamer, the PwC partner who handled the forex investigation and
also led the unsuccessful pitch to pick up the NAB audit contract from
KPMG after the Homeside fiasco.

Walter is said to be very close to KPMG and was clearly expecting a
spray from PwC so she launched a rearguard campaign of
self-preservation which included attempting to undermine the very
report which was going to restore confidence in the NAB.

Directors can’t do this sort of thing so we reckon today’s Kohler
column is the final nail in the coffin for Walter. She either has to
point blank deny that she put the third party onto Kohler or admit it
and resign immediately.

Kohler, Walter, Gottie and leak protocols
Sealed section March 24

The Australian’s Robert Gottliebsen has weighed into the debate
on Alan Kohler’s controversial column about whether isolated NAB
director Cathy Walter was his indirect source attacking the
independence of the PwC report into NAB’s forex scandal. Check out what
Gottie had to say here. The key lines from Gottie were as follows:

“Like most journalists, I go to extraordinary lengths to make sure
the source of the leak can never be discovered. But under board rules
of conduct, leaking information on debates is one of the worst things a
director can do because it strikes at the heart of board
confidentiality and causes directors to lose confidence in each other.
The board can become unworkable. Once a person is a proven board
leaker, they really have to leave the boardroom because no one can be
sure they will not do it again. But it is hard to prove.

“What has happened at the NAB has few precedents in Australian board
meeting history. The business commentator for Melbourne’s The Age (and
The Sydney Morning Herald) Alan Kohler last week wrote about a split on
the NAB board over PricewaterhouseCoopers independence. Yesterday he
revealed that the source of the report was a third party. Although he
does not know who was behind it, ‘Cathy Walter seems to be a fair bet’,
Kohler says.

“I can imagine that Walter, who puts enormous effort into all her
directorships (including the NAB), would feel hardly done by, which is
why she missed an easy opportunity to go with grace. But now she is
being accused of probably leaking board information through a third
party by the respected journalist who published the leak. It’s another
chapter in an incredible saga.”

Alan Kohler is not taking this lying down and told Crikey today that he is “definitely not a source-dobber”.

“When I wrote that ‘Cathy Walter would be fair bet’ as the person
who leaked to me, I meant it would be a fair bet for the board because,
apparently, she was the only one complaining in board meetings about
PwC’s independence,” Kohler told Crikey.

“I still don’t know who it was and there has been no further contact
through the third party. I wrote what I did because I felt I was in a
difficult position commenting about the consequences a boardroom leak
when the leak was to me and a reader would reasonably think I knew who
was behind it and therefore had a conflict.”

CRIKEY: Okay, Kohler was not speculating who his source was, he was
only saying it was a fair bet for the board to think that. We reckon
Kohler probably regrets putting that line in. Crikey has been in this
situation on many occasions. We have numerous sources who we don’t know
but generally try to avoid speculating as to who they might be. Readers
presume that you are best placed to name an anonymous source so if you
do it, people believe you are correct. Maybe the lesson from this is
that leakers should be direct and identify themselves, that way a
journalist can’t even get into the speculation game as Kohler did on

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Peter Fray
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