Terry McCrann today described Peter Costello’s comments over Sol Trujillo’s salary package as “childishly petulant”. McCrann is right, especially when you consider that no CEO’s salary has ever been more widely disclosed or scrutinised than Trujillo’s, as this list demonstrates:

  • When his appointment was announced on 9 June 2005
  • When Telstra’s annual result for 2004/05 was announced on 11 August 2005
  • When the 2004/05 annual report was posted to shareholders on 9 September 2005
  • At Telstra’s AGM on 25 October 2005
  • When Telstra’s annual result for 2005/06 was announced on 10 August 2006
  • When the 2005/06 annual report was posted to shareholders on 25 September 2006.

If Costello is serious, he should have spoken out previously and also voted the government’s stake against the remuneration report. Truth be known, every well-managed company, including Telstra, incents its leaders to address major structural reforms that will build shareholder wealth over the long term.

He arrived at Telstra to find a house riddled with termites and cracked walls, so he decided to tackle the problems right away, even though that would cost money.

This includes no longer borrowing to pay dividends that artificially boost Cossie’s budget surplus and spending money up-front to modernise the company and create long-term revenue streams. Profits have been hit by things like one-off redundancy and restructuring costs, but there has been some progress.

If Sol has really done a bad job, then his critics needs to point to specific mistakes he has made. I’m struggling to see anything substantial after just one year.

Peter Fray

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