It was a case of
parliament meets a corporate AGM yesterday when four members of the
Corporations and Financial Services joint committee – Liberals Grant
Chapman and George Brandis, Labor’s Penny Wong and Democrat Andrew
Murray – attended the first hour of the AWB AGM at Melbourne Park
yesterday.

Sadly, they didn’t get a lot out of it because
besieged chairman Brendan Stewart used the “can’t comment as that’s
before the Cole Inquiry” stonewalling tactic about 30 times over the three-hour meeting.

Sitting in the middle of the politicians was none
other than Gavin Anderson spin king Ian Smith who, along with the
lawyers, presumably advised the AWB board to neuter much of the value
of the AGM by refusing any debate over the Iraq bribery scandal.

Smiffy’s
group and a phalanx of lawyers have soaked up the $16 million pre-tax
hit that AWB has suffered because of the Cole Inquiry, which exactly
explains the promised 10% profit rise this year being wound back to a
flat forecast.

While his general counsel Jim Cooper was being
put through the ringer at the Cole Inquiry in Sydney, Brendan Stewart
relied on three lawyers sitting behind him to guide yesterday’s meeting.

This
brought back memories of the five lawyers who sat behind Sir Eric Neal
at the 1993 Westpac meeting pulling the strings. Stewart got through
yesterday’s torrid meeting in reasonable shape but he came across as
every bit the farmer when one goose from NSW asked whether this whole
Volcker Inquiry was a US conspiracy to get rid of the single desk.
After taking legal advice for 30 seconds, Stewart pointed out that
Volcker was actually a UN thing.

About 30 different shareholders
spoke – 28 farmers and two reps from the Australian Shareholders’
Association – and it was notable that no-one spoke out against the
single desk. After three hours of argument I found myself almost
convinced about its merits, although there clearly needs to be a
massive cull of the board and senior management if it is to remain.

The majority of speakers were from interstate and the Herald Sun this
morning claimed that AWB flew in several pro-single desk advocates from
around the country and put them up in hotels. This may be so, but
Stewart waited until all the questions had expired and not one speaker
called for the abolition of the single desk. Several farmers attacked
the media for dredging up anti-single desk advocates who were certainly
nowhere to be seen yesterday.

The representative board which
gives farmers a guaranteed majority will surely have to go. Brendan
Stewart is the chairman of a $1.5 billion company but yesterday he was
re-elected with 92% support – that was 300 of the 327 Queensland
resident grain growers who were eligible to votes on this resolution.

These
farmers need to realise that if you want public capital, you can’t
have such a ridiculous board gerrymander. Maybe they should buy back
all the B class public shares at full freight and then just leave the A
class grower shareholders to do as they please.

Public
shareholders are clearly frustrated as the only resolution they could
vote on, the remuneration report, attracted a surprisingly large 28%
against vote. This suggests the $400,000 pay rise for directors would
have been defeated if it hadn’t been withdrawn.

Some shareholders
attempted to not endorse the accounts, pass a resolution of dismissal
and postpone the board elections, but this was all batted away by
Stewart, usually after the legal string-pullers had given their advice.

Peter Fray

Get your first 12 weeks of Crikey for $12.

Without subscribers, Crikey can’t do what it does. Fortunately, our support base is growing.

Every day, Crikey aims to bring new and challenging insights into politics, business, national affairs, media and society. We lift up the rocks that other news media largely ignore. Without your support, more of those rocks – and the secrets beneath them — will remain lodged in the dirt.

Join today and get your first 12 weeks of Crikey for just $12.

 

Peter Fray
Editor-in-chief of Crikey

JOIN NOW