Ducker goes down as institutions come of age

Sealed section May 4


Former Labor Party strongman turned Aristocrat Leisure chairman
John “Bruvva” Ducker has gone down in a screaming heap at the AGM today
with a stunning 108.8 million proxies voted against his re-election and
only 2.7 million in favour.

Given our pathetic record of returning dud directors with 99 per
cent of the vote, this is a major step forward in accountability and
corporate governance in Australia. Institutions are clearly furious
with the bloke who dragged the share price down from $6 to $1.50 over
his three year term as chairman and then had the audacity to hang on
for a $560,000 retirement payout which he then brazenly claims is his,
even though he will now fall short of the requisite 5 years of service.

When you consider that 21.8 million open proxies were also voted
against Ducker’s re-election, his final vote was only 2.1 per cent in
favour which is worse than all but two of Crikey’s 18 failed tilts at
public company boards. Only Westfield Holdings and National Mutual
provided worse results for Crikey and this was because controlling
shareholders in Frank Lowy and Axa voted against our tilt.

The emphatic nature of Ducker’s departure means that the board
really should follow the advice of the ASA and withhold the retirement
payout. Ducker was even dumped by his Labor mates who run the industry
funds. Good on them. Well done comrades.

In terms of incumbents losing office in Australia, this is the
lowest vote that we’ve ever heard of in any public election for
anything. We thought that Australia’s worst mayor, Maroochy Shire’s
Allison Grosse, would be hard to beat with her 3.57 per cent of the
vote a few weeks back but Bruvva Ducker appears to have set a new
benchmark for unpopularity.

There were other contentious resolutions on the agenda today but the
proposal to increase annual fees for directors from $750,000 to $1.75
million was passed with 85.6 million proxies in favour and 40.1 million
against. The increase is to compensate for directors for giving up
these controversial retirement benefits that Ducker is trying to pocket.

Check out the full results here: http://www.asx.com.au/asxpdf/20040504/pdf/3lgx2g6bhf4bs.pdf

The only other Australian incumbent director to be ousted from a major
company board was former Coles Myer chairman Solomon Lew who left the
retailing giant’s board in 2002 with 267.8 million proxies in favour
and a hefty 428.5 million against.

Catherine Walter will make this a three person club on May 21 but
the big question is whether she’ll take another director or two with
her, by negotiation or public execution at the EGM.

The NAB directors will look at this Aristocrat vote with much
concern as it is the most emphatic statement we’ve even seen that the
institutional club is finally prepared to start voting against
incumbent directors. However, as with Solly and Walter, this has only
happened on the recommendation of the board majority.

The revolution won’t really begin until institutions start ignoring the advice of boards and vote against duds. We live in hope.

Aristocrat shares fell 5c to $3.87 today and you must remember that
investors who paid $2.90 in the float before the four-for-one share
split are about 500 per cent in front on their investment.

Call him Bruvva Ducker
Sealed section May 5

We were amused by Mark Colvin’s introduction to PM’s report on the Aristocrat AGM last night. The transcript reads:

“John Ducker, also known as “Bruvver Ducker”, has been a
trade union boss, a senior member of the New South Wales Labor Right,
and more recently a company chairman. But today Mr Ducker is not just
an ex-chairman, but an ex director, after shareholders in the poker
machine company, Aristocrat, took their revenge by voting him right off
the Board.”

And this morning’s Rear Window column included the headline “Brother Ducker takes to the Hills”.

Crikey’s been referring to the ousted ALP strongman as Bruvva Ducker
for years but we’re not sure if we can claim credit for the moniker.
Can anyone inform us of any non-Crikey origins? And how should it be
spelt?

Crikey has toyed with many a nickname over the years but only a couple
have stuck, such as “Crispy” Bacon for former Tasmanian premier Jim
Bacon and The Millionaires Factory for Macquarie Bank.

We can’t claim “The Parrot,” but we’ve certainly done more than anyone else to cement it.

Back in 2002 we put together a list of Crikey’s many nicknames –
it’s a little out of date now but should still prove enlightening for
recent subscribers. Check it out here: http://www.crikey.com.au/media/2002/08/18-nicknames.html

Peter Fray

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